VERTEX ENHANCED INCOME FUND - The Newton...
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Transcript of VERTEX ENHANCED INCOME FUND - The Newton...
Total Modified Duration
1.77
Since Inception Return
6.19%
Standard Deviation
7.17%
Performance (Net of fees and includes reinvested distributions)
Investment Objectives
Investment Strategy
5-Year Return
5.18%
The fundamental investment objective is to provide preservation of capital while providing high income by investing primarily in Canadian and United States bonds, debentures, and equities. The secondary objective is to provide capital growth.
The Fund will invest largely in high yield and convertible bonds, preferred shares, high-yielding equities (up to a 25% weight) and government debt including federal, provincial, state and municipal issues.
Covered call writing will be used to enhance yield derived from the equity component of the Fund.
Cumulative Return Comparison Growth of $1,000 Since Inception
Firm Assets
Fund Assets
Type of Fund
Administration/Custodian
Trustee
Inception Date
Auditor
Fund Codes
RSP/TFSA Eligible
Performance Fee
Management Fee
Distribution
NAVPU - Class F
Minimum Investment
Pricing Schedule
Offer Document
Lock up
Redemption Fee
Portfolio Manager | Matthew Wood, Tim Logie & Emily Wheeler Fund Fact Sheet
VERTEX ENHANCED INCOME FUND
$1.53 Billion
$101 Million
North American Income
CIBC Mellon
CIBC Mellon
September 21, 2009
PriceWaterhouseCoopers
VRT 700(B), VRT 701(F)VRT 702 (Low Load)
Yes
20% of the amountexceeding daily Benchmark
B: 1.5% F: 0.75%
Monthly
$9.6747
Daily
Simplified Prospectus
No
2% fee within 30 days of purchase
$5,000 (initial)$50.00 (subsequent)
Not Your Average Income Fund
As at January 31, 2017
Fund Benchmark1 month 1.72% 1.09%3 month 7.08% 2.11%YTD 1.72% 1.09%1 year 20.22% 10.53%3 year 1.33% 4.03%5 year 5.18% 3.37%Since Inception 6.19% 4.00%
Issuer Name Country Sector WeightPNC Financial Financial Services 3.10%USB Realty Corp. United States Real Estate 2.73%Taseko Mines 2.63%IAMGOLD Canada Mining 2.60%Cenveo Corporation United States Printing 2.91%
Example Holdings
Benchmark: 20% S&P/TSX Preferred Share Index, 20% S&P/TSX Composite Total Return Index, 60% DEX Mid Term Total Return Bond Index
A s s e t M a n a g e m e n t I n c.VERTEX ONE
NAVPU - Class B $9.6751Mining
United States
Canada
Vertex Enhanced Income Fund *Benchmark
Jan,13 Jan,17May,10 Sep,11 May,14 Sep,15
1000
1200
1400
1600
800
ACTIVE UNCONSTRAINED OPPORTUNISTIC ABSOLUTE
Total Cumulative Return of $100,000
Suite 3200, 1021 West Hastings St, Vancouver, BC, Canada V6E 0C3Phone: 604-681-5787 Toll Free: 866-681-5787 Fax: 604-681-5146Email: [email protected] Website: www.vertexone.com
Dealer Services
Vertex One Head Office
CIBC Mellon Dealer ServicesPhone: 416-643-6509 Toll Free: 866-885-7505
Credit Breakdown Asset Allocation
We are an independent investment firm that seeks to offer investors a different approach to fund management, one based on capital preservation in both good and bad markets. Through six funds we offer investors a full spectrum of risk and return profiles, actively managed by asset class and strategy exposure. Vertex employees are collectively the largest investors across its funds.
This statistical information is intended to provide you with information about the Vertex Enhanced Income Fund. Advertised performance is based on Class F shares. Important information about the Fund is contained in the Simplified Prospectus which should be read carefully before investing. You can obtain a Simplified Prospectus from Vertex One Asset Management Inc. The Simplified Prospectus for Vertex One Asset Management Inc.’s investment funds does not constitute an offer or solicitation to anyone in any jurisdiction in which such an offer or solicitation is not authorized or to any person to whom it is unlawful to make such an offer or solicitation. The indicated rates of return are the historical compounded returns for the period indicated, including changes in security value and the reinvestment of all distributions and do not take into account income taxes payable that would have reduced returns. The funds are not guaranteed; their values change frequently and past performance may not be repeated.
Mr. Wood is a founder and a director of Vertex One. He has overall responsibility for the investment and trading decisions affecting the Vertex Managed Value Portfolio, Vertex Value Fund and Vertex Enhanced Income Fund. Mr. Wood has 25 years of experience in dealing with equities, fixed income and deriva-tives. He began his career as an analyst, and subsequently became a financial advisor with Royal Trust. He was a portfolio manager with HSBC Asset Management before forming Vertex One. Mr. Wood holds the Chartered Financial Analyst (CFA) designation and is a member of the CFA Institute and CFA Society of Vancouver.
Portfolio Manager - Matthew Wood
Portfolio Manager - Tim LogieMr. Logie began his career in the Property and Casualty actuarial field before completing an MBA and moving into derivative trading at TD Securities in Toronto. While at TD, Mr. Logie worked with Bond Options and Interest Rate Derivatives before becoming TD's Energy Derivative trader. Mr. Logie holds the Chartered Financial Analyst (CFA) designation and is a member of the CFA Institute and CFA Society of Vancouver.
The above provides a strong backdrop for the high-yield bonds in our portfolio. High-yield bonds are “risk-on” assets. An environment in which companies are raising money is indicative of a market that loves high-yield. As an asset class, high-yield performed well over the last quarter and we expect it to continue moving up as companies use free cash flow to pay down debt.
Fund BenchmarkStatisticsStandard Deviation 7.17% 3.53%
Largest monthly gain 4.43% 3.42%
Largest monthly loss -5.18% -2.58%
% positive months 65.17% 67.42%
United States 63.45%
Canada 29.72%
Geographic Allocation
Corporate ProfileHistorical Monthly Performance
Preferred(3.96%)
Foreign Equities(18.30%)
Canadian Equities (3.48%)
Fixed Income USD(60.60%)
Fixed Income CAD (12.12%)
A s s e t M a n a g e m e n t I n c.VERTEX ONE
Europe 6.83%
Third Quarter Commentary*Small Issues And Private Notes
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Year
2016 -2.83% 14.85%
2015 -1.18% 2.02% -1.22% 1.52% -0.26% -0.77% -2.48% -3.18% -2.97% 1.85% -2.31% -2.93% -11.47%
2014 0.63% 2.28% 0.68% 0.61% 1.39% 1.20% -0.47% 1.35% -2.67% -1.06% -1.05% -1.54% 1.24%
2013 2.78% 1.46% 1.17% 1.24% 0.84% -1.49% 1.27% -0.53% 0.90% 1.61% 0.86% 1.05% 11.71%
2012 2.95% 2.67% 0.74% -0.01% -1.70% 0.35% 2.11% 1.33% 1.49% 1.35% 0.07% 1.27% 13.29%
2011 2.14% 1.82% 0.73% 0.58% -0.19% -1.97% -0.72% -4.63% -5.18% 4.08% -2.17% 0.13% -5.64%
2010 1.74% 1.80% 2.51% 3.08% -4.48% -2.03% 4.18% -1.17% 4.08% 2.73% -0.35% 3.74% 16.57%
-1.04%
Cash(0.31%)
4.43% 2.67%
The Vertex Enhanced Income Fund returned 4.32% for the 3rd quarter, 2016. If you’ve noticed a lot more IPOs in the market these days, you’re not alone. As the market gains an increased sense of security, new issue volume has grown steadily.
1.80% -1.06% 1.48% 0.90% 1.88% 0.71%
After performing poorly in 2015, the equity portion of the portfolio has performed very well in 2016. We retained most of our positions from last year as our assessment was that nothing had changed in the businesses, even though stock prices had declined significantly. We did, however, add positions in both Canadian Western Bank (yielding 3.6%) and CI Financial (yielding 5.5%) subsequent to a fall in their stock prices.
3.00% 2.21%
2017 1.72% 1.72%
$147,580
$133,801
$110,000
$115,000
$120,000
$125,000
$130,000
$135,000
$140,000
$145,000
$150,000
Enhanced Income Fund Benchmark
A 5.08%A- 4.82%
BBB+ 53.2%BBB- 6.59%BB+ 2.36%BB 2.08%BB- 7.8%B+ 0.4%B 1.53%B- 2.71%
CCC+ 2.35%CCC 1.12%CCC- 4.46%NR 5.17%
Average B+