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Fundamental Perspective
 

PCJ Small Cap Equity

Product Highlights

  • Bottom-up fundamental security selection
  • Concentrated portfolios maximize alpha opportunity
  • Excels in periods of high volatility
  • Experienced team focused solely on Canadian equities
  • Effective offset to core- and value-style managers

Investment Objective

Our strategy is designed to identify high quality small capitalization companies with superior opportunities for organic growth

Investment Philosophy

  • Market inefficiencies provide opportunities to add value
  • Earnings growth ultimately drives stock prices
  • Concentrated portfolios maximize value from manager insights
  • Catalysts for organic growth are best identified through independent fundamental research
  • Risk management is integral to creating long-term value

Investment Process

  • Goal: Identify high quality companies with opportunities for organic growth with a market capitalization ranging from $100 million to $1.5 billion.
  • Screen using growth variables, e.g.; ROE, earnings momentum
  • Identify catalysts for future growth, e.g.; earnings announcements, restructuring
  • Company meetings: Validate research, confirm confidence in management
  • Proprietary ranking system: Confidence and quality of growth opportunity

Portfolio Construction and Risk Controls

  • Optimize rewards for risk taken
  • Portfolio concentrated (up to 30%) on best ideas
  • Sector weights evaluated relative to macro market themes
  • Absolute and relative stock and sector limits
  • Continuous monitoring of security specific and total portfolio risk
  • Dynamic risk allocation is used to lock in profits and reduce risk
Quick Facts
Inception Date July 31, 2000
All data as at: Oct 18, 2018
Sector Allocation
% of Portfolio
Materials 27.03%
Energy 22.45%
Industrials 19.14%
Real Estate 8.51%
Consumer Discretionary 5.60%
Information Technology 5.42%
Cash 3.37%
Consumer Staples 3.31%
Financials 2.28%
Health Care 1.50%
Utilities 0.84%
Telecommunication Services 0.55%
Top 10 Securities
% of Portfolio
Kinaxis Inc. 3.19%
Kirkland Lake Gold Ltd 3.19%
Cargojet Inc 2.88%
Kelt Exploration Ltd. 2.56%
Hardwoods Distribution 2.53%
Parkland Fuel Corp 2.50%
TORC Oil & Gas Ltd 2.47%
Baytex Energy Corp 2.32%
Canadian Western Bank 2.28%
Chorus Aviation Inc 2.27%
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