Through a dynamic approach, and while continuously seeking superior opportunities, higher growth prospect companies with strong earnings momentum are selected and weighted on a relative basis. Particular attention is paid to valuation, thereby resulting in strong outperformance potential with low active risk.
Quarterly Review As at March 31, 2013
The portfolio’s quarterly performance was slightly below that of the market. Our sound stock selection in the information technologies industry and a favourable sector allocation in materials, were offset by weak security selection in energy and the portfolio’s underweight in healthcare.
We benefited from an overweight position in Groupe CGI and from the good performance of the Couche-Tard chain. Our decision to underweight our holdings in Barrick Gold also benefited, with the cost of gold dropping by $80 over the past quarter.
Our underweight position in Valeant Pharmaceuticals hampered the portfolio’s return. Moreover, our stock selection in the energy sector penalized us. In fact, smaller companies like Torc Oil and Gas were ignored by the market. Also, we were penalized by disappointing results from Suncor, which is also in $1.2 billion of tax debt.
Over the quarter, we sold our holdings in Brookfield Asset Management and reinvested the proceeds in CI Financial in order to benefit from the funds movements towards equities, a move that is bound to help the managers of financial assets. Holdings in Power Financial, Investors Group and Great West Lifeco were also added to the portfolio. We sold our position in AuRico Gold in order to reduce our exposure to gold. Finally, we added automotive parts manufacturer Magna International.