Natcan Investment Management Now Specializing in Absolute Return Products
Natcan Investment Management has unveiled an innovative strategy focusing on absolute return product management.
"Natcan is one of the first traditional portfolio management firms in Canada to develop such expertise, proof of its ability to offer products in response to new market realities. This type of investment vehicle is being introduced gradually throughout our industry and is increasingly attracting interest from institutional investors," said Sam Reda, President and Chief Operating Officer at Natcan.
Absolute return strategies are alternative investments that use unconventional investment vehicles. Their main advantage is that their gains are not correlated to those of traditional asset classes. As its name implies, this type of investment targets an absolute positive return, without factoring in market ups and downs. Therefore, it cannot be compared to any benchmark index. With this type of investment, managers can choose from a wide range of investment strategies that benefit from market inefficiencies or emphasize their particular strengths.
The investment structure selected by Natcan combines bottom-up and top-down market analyses. Investments are selected through a mix of quantitative and fundamental analyses. More specifically, this structure focuses on three types of investments. An initial portion of the portfolio is earmarked for the selection of large- and mid-cap securities, while a second portion uses sector rotations and themes. In both cases, the market risk of the portfolio is neutralized through the use of short positions. Finally, the third and last portion of the portfolio is composed of a selection of small-cap securities, but in limited quantities. This last strategy consists in drawing on managers' best ideas, without any restrictions to a benchmark index. For this portion of the portfolio, safeguarding assets against market risk is left to the managers' discretion. Robert Beauregard, Senior Vice-President, Small Capitalization at Natcan, is responsible for this portion of the portfolio.
In order to excel in this new niche, Natcan Investment Management has hired two new experts to assist Mr. Beauregard. Martin Roberge has been appointed portfolio manager and Benoit Mayer Godin, analyst. Over the past few years, Messrs. Roberge and Godin worked as a high-performance complementary team at National Bank Financial. Furthermore, Mr. Roberge has ranked among the top three quantitative analysts in the past four years, according to Brendan Wood*, which surveys institutional portfolio companies.
*Brendan Wood International (BWI) is an independent global organization providing predictive business intelligence, strategic advisory, transactional and investment related services to both financial houses and corporate participants in the capital markets of the world. The firm is particularly well known for the intensity and depth of its detective work which it integrates with absolutely thorough coverage of global market terrain.
About Natcan Investment Management Inc.
Founded in 1990, Natcan Investment Management Inc. is a National Bank subsidiary that is 25% held by its management team. Recognized as one of the largest institutional fund managers in Canada, Natcan Investment Management Inc. specializes in portfolio management for pension funds, endowment funds, pooled funds and wealth management. It favours a versatile management style focused on value creation, capital preservation and a disciplined approach. Natcan Investment Management Inc., whose activities extend to markets around the world, has $25 billion in assets under management and 120 employees.
About the National Bank
National Bank of Canada is an integrated group which provides comprehensive financial services to consumers, small and medium-sized enterprises and large corporations in its core market, while offering specialized services to its clients elsewhere in the world. The National Bank offers a full array of banking services, including retail, corporate and investment banking. It is an active player on international capital markets and, through its subsidiaries, is involved in securities brokerage, insurance and wealth management as well as mutual fund and retirement plan management. The National Bank has assets of over $82 billion and, together with its subsidiaries, employs close to 17,000 people. The Bank's securities are listed on the Toronto Stock Exchange (NA:TSX). For more information, visit the Bank's website at www.nbc.ca .
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National Bank of Canada
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