TOBAM launches Canadian equity fund

Quantitative asset manager TOBAM has launched its existing anti-benchmark Canadian equity strategy under the format of a UCITS IV fund.

Seed funding from a major Canadian institutional investor supported the new fund.

The fund seeks to maximize diversification by applying TOBAM’s patented maximum diversification approach, which bypasses the sector, country and style biases that plague more traditional allocation methods, says the company.

Read: When home and hot biases collide The fund aims to deliver full equity risk premiums to investors by maximizing diversification in the Canadian equities universe, which is key since the index is highly concentrated in sectors like energy, materials and financials.

TOBAM says the fund will also outperform the S&P/TSX equity cap-weighted benchmark by 4%-to-6% per annum over a market cycle, while delivering significantly less volatility of typically 30%.

“We launched this fund in response to demand from Canadian clients seeking an alternative to investing in their domestic market cap-weighted index, as well as from international clients [who want] to improve the efficiency of their exposure to Canadian equities, often invested passively,” says Christophe Roehri, head of business development with TOBAM.

Yves Choueifaty, president of TOBAM, adds, “Local and international investors in the Canadian market are [realizing] that buying the cap-weighted index is not a neutral position. On the contrary, the Canadian market-cap weighted index carries heavy biases and concentration risk.”

Read: Canada’s fortune tied to China’s Key Fund Information:

Name: TOBAM Anti-Benchmark Canada Equity Fund Structure: UCITS IV Benchmark: S&P/TSX Composite Total Return Index Risk indicator: 6 out of 7 (the rating reflects the volatility of the stock markets in which the fund is invested) Recommended holding period: 5 years Domicile: France Initial net asset value: $10 000 Minimum initial subscription: 10 units Management Fee: 1% Liquidity: Daily

Staff

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