Top Canada Preferred Fund Seeks Value in Turbo-Charged Market
- FGP Preferred Share Fund returned 22% in 2017 vs 14% for index
- Fund’s manager finds undervalued securities by analyzing risk
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The odds of a rate hike at the next Bank of Canada meeting more than doubled after a blockbuster December jobs report, but Canada’s best-performing preferred share fund isn’t rushing to adjust its strategy.
“We put less of a focus on interest-rate anticipation and more of a focus on selecting undervalued securities,” said Ryan Domsy, manager of the C$167 million ($134 million) preferred share fund at Foyston, Gordon & Payne Inc., a Toronto-based investment manager with C$13.3 billion under management. “It doesn’t matter whether they’re floaters, perpetuals or rate resets -- if we’re constantly buying what’s undervalued, we will outperform.”