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April 2022 Newsletter

Since the beginning of 2021, bond holdings have posted double-digit losses and weighed down portfolio performance.1 However, as is often the case in markets, with pain comes opportunity. Despite the potential for continued short-term volatility, we believe the time to increase bond allocations for intermediate and long-term investors is now.
Q1 2022 Market Commentary

During Q1 2022, bond markets suffered across the board as the ongoing conflict in Ukraine, rising inflation expectations, and rising bond yields impacted prices negatively. We discuss the anticipated rate hikes by the US Federal Reserve, corporate fundamentals, and an example of how we generated gains through a relative value lens.
Codifying Climate Disclosures

The SEC recently unveiled its landmark proposal requiring companies to disclose a variety of climate-related data as part of their annual reports and audited financial statements, covering both quantitative and qualitative information. We see this as an important step in the codifying of climate-related risks in line with what we already see in the Eurozone.
January 2022 Market Commentary

2022 began with plenty of market activity as monetary policy took center stage and Covid-19 continued to evolve. We believe the driver of recent volatility stems from changing expectations about monetary policy, including the pace and number of interest rate hikes and a greater chance of quantitative tightening in 2022/2023. Find out more about our views on recent market events in the market commentary linked below.
Tamarack Valley Energy's example of tying social impact to their financing

Tamarack Valley Energy made a mark in the Canadian SLB market as the first Canadian oil and gas exploration and high yield issuer to enter the SLB market, tying financing costs to their ESG targets.
The Inclusion of “Transition” Technology

The EU Taxonomy is a classification system that defines environmentally sustainable economic activity under EU law. in this article, we take a look at where we stand and our views on the taxonomy, especially for natural gas and nuclear energy.
Q4 2021 Newsletter

2021 was an unpredictable but also transformative year in financial markets. We saw concerns around inflation, the emergence of new variants of the virus, and policies from governments and central banks that changed as often as the wind. Understanding 2021 helps us understand what to expect in 2022.
The best of both worlds - value through diversification

In this uncertain market environment, investors are reconsidering their portfolio mix as they try to identify where to obtain reasonable yield without sacrificing the stability of their capital. Diversifying your portfolio to include a SPAC arbitrage strategy could serve as a unique alternative to both fixed income and equity returns during uncertain times.
Reviewing the Bruce Power LP green bond sale

Sustainable debt investors have been debating the inclusion of nuclear power projects in the use of proceeds of green financing. Recently, Bruce Power, which produces 30% of Ontario’s energy, did just that. Aaron Young and Ryan Vaughn spoke with Bloomberg about the reason for this debate and our views on the topic.
ESG Committee Q&A

Three members of our ESG Committee, Ozioma Nwankwo, Aaron Young, and Lubna Reda, participated in a Q&A to discuss the "S" in ESG, specifically when it comes to women in the workplace.
Q3 2021 Newsletter

Inflation can have a broad impact on an economy, whether it is driving consumer decisions or cutting corporate profit margins. Market participants are interested in how policy decisions can strike the right balance to address elevated inflation and the impact these decisions will have on bonds.
What we believe this means for the Energy Sector based on our involvement in this issuance.

Canada faces a “transition gap” that must be addressed by Energy and Utility companies who face accelerating risks as economies move away from fossil fuels. We are happy to be a part of Enbridge's inaugural transactions, which we believe represent the key first step in addressing this gap.
As ESG-linked bonds rise in popularity, are issuers being ambitious enough with their use of proceeds?

One of the most important developments in global credit markets has been the exponential growth of ESG-linked instruments that have been issued across many sectors and from companies at different stages of their ESG development. However, are companies making effort to make meaningful incremental or future changes in their operations or simply benefiting from a lower cost of debt?
The Future of Investing

Our proprietary software (SANTA) helps identify attractive securities and assist with optimal trade execution. Read more about an example of how this enables us to act quickly and effectively.
Q2 2021 Newsletter

In an environment of low yields and compressed credit spreads, there is considerable value in dynamically allocating capital across different geographical markets. Each of our portfolios has a significant component of corporate bonds issued outside of Canada, which gives us a wider menu of investments. In this article, we discuss some of the opportunities we are taking advantage of in our strategies.
Q1 2021 Newsletter

During the first quarter of this year, the “main event” was an increase in long-term interest rates and a steepening of yield curves. We are cautious with A-rated corporate bonds given the incentives for management to sacrifice this rating. We continue to balance defensive investments with exposure to areas of the market where credit spreads have not fully re-traced to pre-COVID levels.
February 2021 Newsletter

Warren Buffett commented "Bonds are Dead" in his annual Berkshire Hathaway newsletter. We do not believe "Bonds are Dead" but the traditional approach to bonds must adapt to new investor needs.
Opportunity in the travel sector during COVID-19

The travel sector was arguably the hardest hit sector by COVID-19, and as an online travel agency (OTA), Expedia’s business was severely impacted. Here is an update on one of our high conviction positions – Expedia – as the company returns to the debt markets, this time to repurchase debt and issue it.
January 2021 Newsletter

Having a disciplined and selective approach is very important as global credit markets continue to adapt and evolve. One question remains - how will corporations manage all the liquidity they raised last year?
A historical social media driven short squeeze | Commentary by Mike Quinn & Aaron Young

How social media influenced the market and what this means for corporate bonds and the future.