At Rempart, we invest in companies, not markets. To this end, equity investment follows stringent criteria, with research conducted in-house by our senior investment professionals.
The primary focus of our research is the generation and application of free cash flow. This process, which we term “Tracking the Cash”, concentrates on companies that generate significant amounts of free cash flow. These tend to be businesses that are non-cyclical in nature, are market leaders, generate consistent and stable corporate growth, have strong balance sheets and solid management with proven records.
“Tracking the Cash” goes beyond cash flow generation. The manner in which a company applies its cash to the benefit all stakeholders, namely its employees, customers and shareholders, is of critical importance. To this end, we focus on companies that use their free cash flow intelligently, by investing in fixed capital additions, strengthening their financial position by buying back shares or increasing dividends. Experienced management, balance sheet strength and proper allocation of cash flow are crucial to investing for growth and managing risk.
Our investment approach is backed by rigorous fundamental analysis by our investment team. Our senior investment professionals are trained financial analysts and meet with over 100 companies annually, 25 to 30 of which are deemed suitable for client’s portfolios.
In-depth knowledge of individual companies and diversification across industry groups allows us to structure clients’ portfolios for consistent returns without significant volatility. Combining growth and capital preservation is the underlying goal of Rempart’s equity investments.
When searching for the companies with the greatest growth potential, an important component of our analysis is the early identification of macro-trends. These trends influence the performance of the various equity sectors and are driven by a combination of many factors, including geo-political, economic, and emerging industrial developments.
Our fixed income investment strategy combines the objectives of capital preservation and income generation. Risk is minimized in this area with investments being largely focussed on Canadian Federal and Provincial government bonds as well as high quality corporate issues. For taxable portfolios, preferred share investments will also be considered.
We undertake a disciplined approach within the fixed income area, concentrating on investment grade securities and the relative valuations between federal, provincial and corporate issues. Our investment decisions are influenced by our analysis of key macro-economic, financial and political issues.
This approach allows Rempart to maximize client returns, while minimizing exposure to adverse shifts in the fixed income markets.
Balanced portfolio mandates are structured for consistent returns within a low risk framework. This is accomplished through diversification in both the equity and fixed income areas and by the quality of the portfolio holdings.
In determining the appropriate asset mix, longer-term trends, including the business cycle, inflation and interest rate trends, fiscal and monetary policies and other financial indicators are considered. The impact of these factors on the various asset classes, in concert with the goals of high quality growth and capital preservation, drive our asset mix process.
The experience and depth of our investment team enables us to make portfolio decisions quickly and, more importantly, implement them into our client portfolios in a timely manner.
We do not believe in market timing, as such strategies increase volatility and detract from after-tax returns.