adding value while managing risk

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Adding Value While Managing Risk. Profile of Fairlane Asset Management. Manages traditional & non-traditional bond mandates Experienced investment professionals Services high net worth and institutional investors, including foundations & trusts - PowerPoint PPT Presentation

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  • Adding Value While Managing Risk

  • *Profile of Fairlane Asset Management

    Manages traditional & non-traditional bond mandates

    Experienced investment professionals

    Services high net worth and institutional investors, including foundations & trusts

    80% of our investors have been with us for more than fifteen years

  • *Fairlanes History

    Fairlane Asset Management was founded in 2003

    Merged with Strathy Investments Ltd. in 2005 creating over 33 years of experience

    Registration with the Ontario Securities Commission: Portfolio Manager (PM) Investment Fund Manager (IFM) Commodity Trading Manager (CTM)

  • *Fairlane A Plus Bond Hedged Fund Fairlane Asset Management Service Providers:

    Caledon Trust - Trustee Commonwealth - Fund AdministrationGowlings - Legal National Bank Prime BrokerageSB Partners - Accountants

  • *Fairlanes Business

    Our focus is providing superior absolute returns

    We concentrate in Special Situation Investing using the following investment strategies:Fixed Income Long / Short Investing (Fairlane Credit Arbitrage) with leverageFixed Income Long Investing (Fairlane A Plus Bond) traditionalFixed Income Long Investing with Hedge (Fairlane A Plus Bond Hedged) non-traditionalEquity and Fixed Income Investing (Fairlane Balanced)

  • *Fairlanes Product ProfileFairlane Credit Arbitrage Strategy Canadian Fixed Income StrategiesFairlane A Plus Bond Hedged Fund Canadian Short Credit Bonds and Govt BondsFairlane A Plus Bond StrategyCanadian Fixed Income StrategiesExpected ReturnRiskFairlane Balanced StrategyMid Cap Equity with Fixed Income

  • *Fairlane A Plus Bond Hedged FundPhilosophy and Objective:

    The Fund actively invests in undervalued investment grade corporate bonds with an average credit rating of A (as per S&P, Moodys)The bonds in the Fund will have an average duration of less than 5 yearsThe Fund can use Government bonds as a hedge to mitigate interest rate risk and also can be used opportunistically when market conditions warrantThe Fund invests in securities that are highly liquid

    Suitability :The Fund is suitable for fixed income investors seeking a lower risk strategy to invest in an actively managed portfolio of bonds This Fund should be a part of your overall asset mix.

  • Fairlane A Plus Bond Hedged FundInvestment Style:

    Long Credit what we do or look forRich/CheapTop Down LiquidityCredit Rating Underlying stock performance

    Government of CanadasMatch duration Add alpha value Trade around edges when opportunity exists

    *

  • *Fund Facts : GlobeFund Five Star Rating Inception:July 1, 2011Management Fee: 100 basis pointsPerformance Fee is 15% of our return over a High Water MarkExpenses: 30 basis points (capped)Category:Fixed IncomeRisk Profile:Low.XHighMin Investment:$100,000 for Pooled FundsDistribution Frequency:Systematically re-invested, T5 at end of yearAsset Mix/Credit Mix:A credit on averageLiquidity: Monthly redemptions & purchasesTax Efficiency:Fund is very tax efficient as approx 70% of fund return is Capital gain

    Fairlane A Plus Bond Hedged Fund

  • *Fairlane Asset Management Current Investment Strategy :Fund is positioned to take advantage of current spreads between attractive Corporate Bonds and Government Bonds Fund is also positioned well to take advantage of expensive Government Bonds Active Management provides increased returns by trading hedge Manager believes that current economic conditions forecast higher bond yieldsHedge will protect capital in a bear bond environmentFund will invest in a portfolio of Corporate securities and High Yield producing a high internal positive cash flow which will add to net returnFund would suit investors that seek above average fixed income return

    Fairlane A Plus Bond Hedged Fund

  • *Fairlane A Plus Bond Hedged FundCompounded Rate of Return Chart*Globe Canadian Short Term Fixed Income Peer Index

    1 Month3 Month6 Month1 Year5 Year10 YearSinceInceptionFund0.60%-0.24%5.40%8.51%8.51%Benchmark*0.12%0.60%0.69%2.52%2.52%

  • *Fairlane A Plus Bond Hedged FundJuly 2011 to June 2012Monthly Returns

  • *Fairlane A Plus Bond Hedged Fund vs Globe Cdn Short Term Fixed Income Peer Index

  • 5 Yr. RBC Corp Bond ETF vs. 5 Yr. Govt of Can BenchmarkFairlane A Plus Bond Hedged Fund

  • *Fairlane A Plus Bond Hedged Fund Canadian 10-year bond yield too low Probability rates going higher at some point Fund is protected against higher rates

  • Fairlane A Plus Bond Hedged Fund Current Economic Scenarios and Outcomes

    Economic ExpansionEPS growing , stocks higher, credit tightens Canadas decrease in price , down in price as BOC tightens eventuallyEconomic Contraction Flock to Canadas for safetyCredit trades flat or downManager would reduce shorts outright or partially

    Economic LullPick up positive spread between Corps and Canadas Pick up trading gains *

  • Robert Bradeen30 St. Clair Ave West, Suite 1105 Toronto, Ontario M4V 3A1t (416) 975-1900 f (416) 975-1933www.fairlane-am.com | rbradeen@strathy.com

    Contact

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