The fixed income portion of a portfolio is viewed as a source of stability and income. As such, great care is taken to avoid credit risk that is normally inadequately compensated by higher returns. The equity markets offer more generous compensation for risk.
We stress forecasting major swings in interest rates and adjusting the term of the portfolio accordingly. Our belief is that short-term fluctuations are extremely difficult, if not impossible, to forecast consistently, whereas intermediate-term movements can be easier to predict.
We prepare detailed economic forecasts for Canada and the United States. We also follow this data for Europe and Asia. We analyze all major currencies in-house. From this work we seek to determine the inflation outlook and demand for funds in each economy and sector in order to analyze the medium to longer term direction of interest rates.
The financial characteristics of specific instruments can be quite important. For instance, the choice between a coupon and a bond of equal duration can often be a strategic issue. Attention is thus given to analyzing the special characteristics of many bonds, such as extendible, retractable, callable, redeemable, convertible and currency features.
Independent since 1987, Letko Brosseau has provided clients long-term outperformance with investments in Canada and around the world.
We take a disciplined, long-term view based on fundamental research, economic analysis and the deep industry expertise of our multi-disciplinary team.
annualized return for over 32 years
annualized benchmark outperformance
Value added represents the excess return over the weighted average of all clients’ benchmarks for all assets under management gross of fees from Jan 1, 1988 to December 31, 2019.
Performance numbers referenced above are annualized and presented in Canadian dollars gross of fees for all assets under management from Jan 1, 1988 to December 31, 2019 and do not refer to any composite. The benchmark represents the weighted average of all clients’ benchmarks.
Past performance does not guarantee future results.