This strategy is a core Canadian fixed-income strategy that aims to maximize total return through interest income and capital appreciation. The portfolio is primarily invested in short- and medium-term investment-grade fixed-income securities issued by Canadian governments and corporations. The return objective is to outperform the FTSE Canada Short Term Bond Index as well as its peers throughout economic and market cycles.
100% FTSE Canada Short Term Bond Index
Philosophy and process
The portfolio is actively managed using a top-down multi-strategy approach that leverages diversified sources of added value.
The strategy management is primarily based on anticipating interest-rate movements from analysis of macroeconomic trends. Duration management and curve-positioning are therefore the main sources of added value, followed closely by sector allocation and issuer selection.
From time to time, the manager may add securities denominated in foreign currencies, real return bonds or other securities to enhance returns and or reduce volatility.
Risk is managed as per the following guidelines:
Duration positioning: +/-1-year vs index
Sector positioning: +/-25% vs index
Active yield curve positioning
Credit analysis of corporate issuers by leveraging the expertise and prudent approach of the iAGAM corporate credit team
ESG risk and opportunities analysis
Maintaining an average portfolio credit quality of AA
Maximum of 5% of the portfolio may be invested in high-yield bonds and senior loans
Currency risk is partially or totally hedged, at the discretion of the portfolio manager.
Why invest in these strategies?
Predominantly Canadian fixed-income exposure with a proven track record of outperformance through market cycles managed by an experienced management team with high industry expertise.
Investment in short- and medium-term bonds makes this strategy less sensitive to changes in interest rates.
Access to a well-diversified portfolio that offers daily liquidity.