We are very wary of the huge rally in credit spreads, and we are selling into the very strong bids that we are seeing for things we acquired cheaply during and after the pandemic. We are in our portfolio phase of not assuming uncompensated risks. We believe the scramble to “get invested” has resulted in too much narrowing of credit spreads and the rewards from lower quality credit do not justify the risk assumed. To learn more, read the January 2024 Canso Market Observer.
Canso Investment Counsel Ltd.- About UsShow sub menu
- The Canso Aircraft
Canso Investment Counsel is named after the PBY-5A “Canso” amphibious aircraft. The Canso is the Canadian manufactured variant of the Consolidated PBY 5 naval patrol bomber. We named our firm for the Canso, admiring its ruggedness, endurance and flexibility which we believe are the hallmarks of our investment strategies.
- Our Guiding Principles
Our methods are not quantitative or fashionable. Our contrary nature is tempered by our risk management discipline. Many years of investing in distressed debt has given us a substantial insight into the value of issuers after default. We spend a lot of time examining issuers and assessing their creditworthiness.
- Our Culture
We believe in giving back to the community. We are fortunate to have a successful business and we believe it is our social responsibility to give back. We rank at the top of the Movember leaderboard and run year-round United Way campaigns. Employee participation has been 100% since inception and we strive to maintain that enthusiasm.
- Our Team
Our team exhibits a tremendous wealth of experience and a great depth of knowledge, bringing to bear our combined expertise on every investment decision we make.
- MethodologyShow sub menu
- Investment Philosophy
Our fixed income approach concentrates on security selection. We believe that fundamental analysis and security selection will add substantial value compared to a more “passive” approach. Fundamental analysis and security selection will add substantial value.
- Research Process
Our investment process is focused on bottom up, fundamental research and security selection. Our prime focus is on our internal credit research. We do not rely on external research and credit rating agencies. With our large staff of credit professionals we believe we have greater research resources than most other investment managers or Canadian investment dealers.
- Decision Making Process
Our investment process begins with a thorough fundamental review of the issuer of a security by the analyst. A team meeting is then held to consider the issue or issuer in question. We encourage active participation by all investment staff and structure the meeting to allow a full and open discussion.
- Portfolio Construction
Our portfolios reflect our “bottom up” research emphasis. Rather than identifying likely sectors for investment, we select individual securities with regard to their intrinsic risk and return trade-off. Our portfolios are constructed with little regard for the industry and geographic breakdowns of market indices but our credit limits for individual holdings and ratings categories are always maintained.
- Risk Management
No matter how good the credit analysis or the underlying situation of the issuer, there is the potential for disruption to cash flows that cannot be foreseen. Such a disruption can be disastrous for a weaker or lower quality credit. We believe that diversification is key to appropriate corporate bond investment.
- Responsible Investment
In our fiduciary role, we believe environmental, social, and governance (ESG) issues can affect the performance of issuers included in the investment portfolios we manage, but that the effect can vary substantially across issuers. We believe we have an overriding duty to act in the best long-term interests of our clients.
- SolutionsShow sub menu
- Corporate Bond Management
We are a specialty manager of Canadian corporate bond portfolios for some of Canada’s most sophisticated investors. Our long collective experience in credit analysis contributes to our ability to avoid overpriced and risky issuers. We do not avoid risk. We ensure that credit risk is priced appropriately and that our client portfolios are compensated for the risks they assume.
- Institutional Investors
Our institutional clients include major corporations, endowments, insurance companies, unions and universities. We are dedicated to delivering superior investment performance to our clients. Successful investing generates returns over long periods through economic and financial cycles. Our mission is to deliver returns to those who have entrusted us with funds to manage.
- Private Investors
In today’s financial markets of low yields and high risk, private investors often risk a substantial portion of their hard-earned capital to try to obtain a reasonable investment income. We can help you obtain your investment goals through a variety of investment strategies. We invest in a wide variety of securities but we look before we leap.
- PublicationsShow sub menu
- Corporate Bond Newsletter
Read our current thoughts on the corporate bond market.
- Market Observer
Our most recent observations about the current market conditions and where things could be headed.
- Position Reports
Our position on the markets.