We're thrilled to announce that we've signed three leading money managers to the Steadyhand team. They will manage 4 of our 5 funds. This day comes after months of research, deep thinking, interviews, unhealthy lunches and airport line-ups (who knew that carrying a tube of Blistex could lead to a lecture on air transportation safety).

The criteria we use for assessing managers are the same ones we think investors should use when picking funds for their portfolio. Are the managers experienced? Do they have an established philosophy and are they passionate about it? Do they have a good long-term record? Are they the appropriate size to pursue all opportunities in the market?

We had other Steadyhand criteria as well, which narrowed the field considerably. We were looking for managers whose investment philosophy was aligned with ours. Specifically:

  • a fund's assets should be concentrated in the portfolio manager's best ideas;
  • making money (absolute returns) is more important than tracking an index (relative returns);
  • the less constraints placed on a portfolio manager, the greater their set of opportunities and ability to outperform; and
  • low portfolio turnover is a key to superior returns - to us, frequent trading signifies a lack of confidence and tax awareness.

The managers we've selected share our philosophy and convictions.

Cranston, Gaskin, O'Reilly & Vernon Investment Counsel will manage our Equity Fund, which is designed to be a core portfolio holding that will invest in Canadian and foreign markets. CGO&V is an investment boutique in Toronto that caters primarily to high-net-worth individuals. Their investment philosophy is based on the premise that a portfolio represents a collection of ideas and that a few well-reasoned ideas will yield superior results over a vast number of mediocre ones. Sound familiar? CGO&V demonstrates their conviction by owning a maximum of 25 stocks. As a boutique firm, they also have the flexibility to pursue opportunities in all areas of the market which fits well with the 'all-cap' mandate we have given them. The firm has produced impressive returns for their long-standing clients and we're pumped to have them on board.

Wutherich & Company Investment Counsel will manage our Small-Cap Equity Fund, which invests in small to mid-cap stocks in Canada and the U.S. We were told about Wil Wutherich by some of our contacts in Montreal. Despite an excellent record, he has managed to fly under the industry's radar screen up until now. Wil started his career at one of Montreal's best training grounds, Standard Life, and further developed his skills as a partner at Van Berkom and Associates. He started his own firm 7 years ago and ever since his sole focus has been on delivering absolute returns for a small stable of clients (which includes a majority of his family's net worth). Wutherich has always managed only one model portfolio, and it fits perfectly with what we want the Small-Cap Equity Fund to be. We really like the fact that finding the best 15-20 stocks to own for that model is the only thing Wil focuses on... all day... everyday.

Connor, Clark & Lunn Investment Management will manage our Savings Fund and Income Fund. The former fund invests in short-term money market instruments, while the latter is a diversified income fund that invests heavily in bonds with some exposure to REITs, income trusts and high-yielding equities. CCLIM is a highly reputable Vancouver-based firm that has close to $6 billion in fixed income assets under management. While size can be an impediment to managing equities, it's an asset in fixed income management, where economies of scale and market position are important. CCLIM has a talented research team, a tried and tested investment process and the necessary toolkit to manage our income funds.

We are not yet ready to announce the manager of our Global Equity Fund.

At this point, Steadyhand's foundation is firmly in place and we can't wait to get started. Although we still have a few grueling months of startup ahead of us and a few more team members to add, we are still targeting the first quarter of '07 to open our doors to the public. In the coming weeks, we will provide further updates on other aspects of Steadyhand as well as the challenges we've faced. And as soon as we can be more precise on our startup date, we will let you know.