Cambridge Canadian Equity Corporate Class started the year with a barbell approach – lots of cash (nearly 25%), but cyclical beta as well. As we have always promised, first and foremost, we continue to be positioned to protect the downside considering our concerns about earnings, trading volumes and the slowing of China. However, we respect the fact that clients still want to see positive numbers which we have delivered without taking undue risk chasing returns.
Brandon Snow's blog
Many times in the history of the markets we have seen street darlings fall from grace – with the bubble being burst explained by fraud, speculation, mass hysteria or all three. We all know emotionally, it’s easy to get caught in a company’s “story”. When everyone seems to be making money and a stock is only going one direction it’s tough for many to sit on the sidelines.
There has been much debate around market valuation recently, with general agreement that the many markets is “expensive” vs. history and compared to current (uninspiring) fundamentals. I will use the S&P 500 as an example:
Over the last five years or so, people have gotten to know the three dimensions of our investment philosophy at Cambridge: 1) active management 2) a focus on understanding downside risks and 3) an ownership mentality.
The upcoming referendum on whether the U.K. should stay or leave the European Union (or “Brexit”) has become a tremendous news story. Given the uncertainty and excitement the press has been hard at work, in turn creating anxiety in financial markets and concern among individual investors. Ongoing close poll results and high profile individuals on both sides have further added fuel to the fire.
One of the most impressive CEOs I have dealt with in my career is Hunter Harrison – former CEO of CN and current CEO of CP Railway. As an analyst covering CN, I had the privilege of getting insight into his thought process. As shareholders, we were fortunate to participate in the stock’s performance.
Bob, Steve and I just returned home from the annual roadshow which spanned 23 cities from coast to coast and included over 4500 financial advisors. First of all, I want to say thank you once again for the support and hospitality we received. It’s exciting to get out in front of our clients to discuss our current views and revisit our philosophy, and we were humbled by the record turnouts in nearly every city we visited.
Momentum and the markets