Transcript Slide 1

SIGNATURE GLOBAL DIVIDEND FUND
SIGNATURE’S INTEGRATED MARKET CONCEPT
“Markets are interconnected. A successful investment approach
should be equally integrated and connected – encompassing rates,
credit, equity, commodities, property and foreign exchange within
a coordinated global view.”
Eric Bushell
Chief Investment Officer
Signature Global Asset Management
SIGNATURE OVERVIEW
Facts
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Global investment team based in Canada
33 person investment team – one of the largest in Canada
Core investment style, with diversified portfolios of large-cap securities
Specialize in broad flexible mandates
$40 billion in AUM – ample scale to compete for talent, research and trading
*Cash & cash equivalents: commercial paper, floating rates,
bonds (in money market) and government (in money market)
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As at June 30, 2013
DEEP, SPECIALIZED INVESTMENT TEAM
CHIEF INVESTMENT OFFICER
ERIC BUSHELL, CFA (18)
GLOBAL INVESTMENT STRATEGISTS
Drummond Brodeur, CFA (22)
Eric Bushell, CFA (18)
Matthew Strauss, CFA (17)
GLOBAL SECTOR/ ASSET CLASS SPECIALISTS
Tech, Media, Telecom
Malcolm White, CFA (16)
Jeremy Yeung, CFA (10)
Financials
John Hadwen, CFA (18)
Goshen Benzaquen (10)
Aero, Auto, Defence, Utilities
Massimo Bonansinga, M.B.A. (21)
Gorlen Zhou (2)
Energy & Materials
Scott Vali, CFA (15)
Hoa Hong, CFA (10)
Sara Shahram, CFA (9)
Industrials, Transport
Joe D'Angelo, CFA (14)
Income Trusts/REITS
Ryan Fitzgerald, CFA (7)
Joshua Varghese (1)
Consumer
Stephane Champagne (16)
Henry Kwok (11)
Healthcare
Jeff Elliott (10)
High Yield
Geof Marshall, CFA (15)
Kevin McSweeney, CFA (13)
Brad Benson, M.A. (13)
Carlton Ling, CFA (8)
Darren Arrowsmith, CFA (12)
Rates and Foreign Exchange
Eric Bushell, CFA (18)
Paul Simon, CFA (10)
Matthew Strauss, CFA (17)
TRADING PROFESSIONALS
Shawna McIntee (7)
Aldo Sunseri (26)
Connie Lee (10)
Investment Grade
John Shaw, CFA (21)
Paul Simon, CFA (10)
Leanne Ongaro, CFA (4)
Jonathan Chew (1)
Derek Tucker, CFA (11)
Shelly Ghai, M.B.A. (7)
Preferreds
John Shaw, CFA (21)
WHY GLOBAL DIVIDEND STRATEGY?
• Earnings yields and dividend yields on global equities extremely
attractive relative to fixed-income yields.
• Poor supply of dividend opportunities in Canada, especially
relative to demand.
• Dividend payers tend to outperform the market over the
long-term.
EARNINGS YIELD HIGH – DIVIDEND YIELD OK
Source: Bloomberg, as at August 30, 2013
EARNINGS YIELDS EXTREMELY
ATTRACTIVE RELATIVE TO BONDS
Source: Bloomberg, as at June 30, 2013
DIVIDENDS YIELDS OR BOND YIELDS?
CONSUMER
Est. Dvd Yield
Bond Yield
NEWELL RUBBERMAID
2.3
3.08
NWL 6.25 04/15/2018 Corp
MCDONALDS CORP
3.3
1.90
MCD 5.8 10/15/2017 Corp
NESTLE SA-REG
3.4
2.12
NESNVX 1.375 07/24/2018 Corp
COCA-COLA CO/THE
3.0
1.78
KO 1.65 03/14/2018 Corp
PROCTER & GAMBLE
3.1
2.37
PG 2 08/16/2022 Corp
PEPSICO INC
2.8
2.28
PEP 5 06/01/2018 Corp
PHILIP MORRIS IN
4.1
2.37
PM 5.65 05/16/2018 Corp
BRIT AMER TOBACC
4.7
2.75
BATSLN 6.375 12/12/2019 Corp
KRAFT FOODS GROU
3.8
1.39
KRFT 7.55 06/15/2015 Corp
DIAGEO PLC
2.7
1.79
DGELN 1.5 05/11/2017 Corp
CARLSBERG-B
1.1
2.98
CARLB 2.625 11/15/2022 Corp
Source: Bloomberg, as at August 30, 2013
DIVIDEND YIELDS OR BOND YIELDS?
FINANCIALS SECTOR
JPMORGAN CHASE
3.0
2.46
JPM 1.8 01/25/2018 Corp
WELLS FARGO & CO
2.9
2.16
WFC 1.5 01/16/2018 Corp
PNC FINANCIAL SE
2.4
1.43
PNC 2.7 09/19/2016 Corp
METLIFE INC
2.3
1.35
MET 6.75 06/01/2016 Corp
PRINCIPAL FINL
2.5
1.91
PFG 1.85 11/15/2017 Corp
SWEDBANK AB-A
6.4
1.31
SWEDA 3.375 02/09/2017 Corp
BBVA
5.7
2.42
BBVASM 3.5 12/05/2017 Corp
ALLIANZ SE-REG
4.1
1.72
alvgr5.352 12/18/18 corp
ROCHE HLDG-GENUS
3.1
0.73
ROSW 5.625 03/04/2016 Corp
BAXTER INTL INC
2.8
2.22
BAX 5.375 06/01/2018 Corp
NOVARTIS AG-REG
3.3
2.36
NOVNVX 5.125 02/10/2019 Corp
BAYER AG-REG
2.2
2.56
BAYNGR 5 07/29/2105 Corp
BAYER AG-REG
2.2
2.09
BAYNGR 5.625 05/23/2018 Corp
HEALTH CARE SECTOR
Source: Bloomberg, as at August 30, 2013
IS THE WORLD UNDERWEIGHT EQUITY?
Global Financial Assets $T
June
1990
1995
2000
2005
2010
2012
Government Bonds
9
14
18
29
43
47
Financial Bonds
8
11
19
30
41
42
Corporate Bonds
3
3
5
7
10
11
Securitized loans
2
3
5
9
13
13
Total Fixed Income
22
31
47
75
107
113
Equity
11
18
37
47
54
50
50.0%
58.1%
78.7%
62.7%
50.5%
44.2%
Equity as % of Fixed Income
Source: Mckinsey Global Institute Financial Assets Database
IS THE WORLD UNDERWEIGHT EQUITY?
CANADA AS % OF THE WORLD MARKET
Source: Bloomberg, as at August 30, 2013
CANADA AS A PERCENT OF THE U.S. MARKET
Source: Bloomberg, as at August 30, 2013
CANADA VERSUS THE WORLD
Canadian Dividend Payers by Sector
Global Dividend Payers by Sector
Opportunity set for market cap >$2B and yield >2.5%
Source: Bloomberg, as at August 30, 2013
LONG-TERM PERFORMANCE OF DIVIDENDS
The top decile stocks as measured by free cash flow/EV have significantly outperformed
500
450
400
350
Equal-Weighted Relativ e Cumulativ e
Performance v s. Equal-Weighted S&P 500
June 1989 = 100
Backtested
Actual
300
250
200
150
100
50
86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13
Source: Bank of America, as at August 30, 2013
SIGNATURE GLOBAL DIVIDEND FUND STRATEGY
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Sector PMs identify, assess value and track superior free cash flow generating businesses in their
sectors globally. The more companies we know the greater the opportunity set!
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Sector PM’s transact on identified opportunities – buy attractive free cash flow generating
businesses when compelling entry points occur. Is valuation sufficiently attractive relative to the
risks? Are we being paid to worry as measured by free cash flow and/or dividend yield?
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With very large opportunity set, we need to ensure we are constantly reallocating capital to best
risk-adjusted opportunities.
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Maintain reasonable sector and geographic diversification.
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Not a yield chase! Generally willing to give up a bit of yield in favour of growth and durability.
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Use macro input/considerations; sector review meetings to actively influence capital allocation by
geography and sector.
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Active currency hedging intended to add value.
SIGNATURE GLOBAL DIVIDEND FUND
AS OF SEPTEMBER 16 2013
Source: Signature Global Asset Management
SIGNATURE DIVIDEND FUND –
NOT A YIELD CHASE
Source: Signature Global Asset Management, as at August 30, 2013
Thank You
FOR ADVISOR USE ONLY
All charts and illustrations in this guide are for illustrative purposes only. They are not intended to predict or
project investment results. Commissions, trailing commissions, management fees and expenses all may be
associated with mutual fund investments. Please read the prospectus before investing. Mutual funds are not
guaranteed, their values change frequently and past performance may not be repeated.
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