Account Login

Canadian Bonds

Profile

  • Managed in-house since the firm's inception in 1974
  • Provides returns from both capital and income primarily from bonds and debentures of Canadian government and corporate issuers
  • Core positions of Government of Canada bonds based on the shape of the yield curve and level of interest rates
  • Enhanced positions of provincial, municipal and corporate bonds to implement security selection and yield spread strategies
  • Exploit inefficiently-priced areas of the fixed income markets to add value
  • Active constrained duration strategy using a flexible blend of sector allocation, security selection and trading strategies to add value

Objective

Better than market rates of return with lower than market levels of risk over economic cycles. The DEX Universe Bond Index is generally used as a benchmark for both returns and standard deviation.

Investment Process

1. Sector Allocation Strategy

We typically overweight those sectors of the fixed income market that provide attractive yields relative to Government of Canada bonds. That is, we generally emphasize investment grade corporate, provincial, and municipal bonds.

2. Security Selection Strategy

We actively seek attractively priced securities using in-house credit analysis. Credit risk is also researched and monitored using dealer research and credit rating agency reports from Standard & Poor’s and Dominion Bond Rating Service. Credit risk is integral to our style as we seek opportunities to pick-up yield through security selection without sacrifice of credit quality.

3. Trading Strategies

We monitor bond markets in an effort to identify and exploit mispriced securities. These anomaly areas of the market may hold potential investment opportunities. We utilize the internal sources of our research team and strong, focused dealer relationships to generate investment ideas and execute on them.

Portfolio Manager

Michael Crofts, CFA, Director, Portfolio Manager

Need More Information?

If you wish to receive detailed information about our Canadian Bond management, please e-mail us at Mawer Information .