Picton Mahoney Asset Management has listed four actively managed ETFs on Toronto Stock Exchange, providing exposure to a range of alternative investment strategies.
David Picton, President & Portfolio Manager at Picton Mahoney.
The listings include a brand new fund as well as ETF share classes for three existing Picton Mahnoey ‘Fortified Alternative’ mutual funds.
Each of the four funds incorporates the firm’s proprietary Fortified Investing approach – a rules-based process focused on managing risk by mitigating downside exposure while seeking to build long-term wealth, regardless of market conditions.
“We recognize the need for Canadian investors to have choice in how they invest in and access differentiated solutions that can fortify their portfolios,” said David Picton, President & Portfolio Manager at Picton Mahoney.
“It’s a perfect time to bolster our family of Fortified Alternative solutions with the benefits of new ETF classes and add a total return income alternative strategy to the line-up.”
The three ETFs born out of existing mutual funds are as follows:
The Picton Mahoney Fortified Active Extension Alternative Fund (PFAE CN) aims to provide long-term capital appreciation with similar volatility to traditional equity markets. The fund employs a long/short strategy within the Canadian equity universe, targeting a net long exposure of 100% by investing 130% of assets long while selling 30% of assets short. Its benchmark is the S&P/TSX Composite Index.
The Picton Mahoney Fortified Market Neutral Alternative Fund (PFMN CN) aims to provide long-term capital appreciation with less volatility and low correlation to traditional equity markets. The fund employs a true market neutral equity strategy, aiming for a zero average equity market beta. According to Picton Mahoney, the strategy offers diversification and serves as a complement to typical long-biased portfolios by reducing the impact of drawdowns.
The Picton Mahoney Fortified Multi-Strategy Alternative Fund (PFMS CN) aims to provide consistent capital appreciation with low correlation to traditional balanced or diversified strategies. The fund utilizes a proprietary multi-layered investment process based on modern portfolio construction techniques to determine its allocation, utilizing traditional and alternative assets classes, factor risk premia strategies, and alpha processes. A discretionary hedge layer is available to tactically enhance the fund’s return.
The new addition is the Picton Mahoney Fortified Income Alternative Fund (PFIA CN) which aims to maximize total return through income and capital appreciation by investing in corporate bonds while mitigating capital loss through shorting and other hedging strategies.
Phil Mesman, Head of Fixed Income at Picton Mahoney, commented, “We’re in an environment where investors need to think differently about income investing – with low yields and increasing volatility, traditional bonds will have a hard time delivering. Investors need alternative income strategies and tools to augment their income portfolios. The Picton Mahoney Fortified Income Alternative Fund aims to address this need.”
Each ETF comes with a management fee of 0.95% and charges a performance fee of 20% of performance above either its benchmark or a 2% hurdle rate with a perpetual high watermark.