- Risk Targeted
- Asymmetric Risk/Reward
- Fundamental Analysis
Todd David MacSween is a CFA Charterholder. He graduated from the University of Victoria’s Bachelor of Commerce program with distinction. He then began to pursue the rigorous and coveted Chartered Financial Analyst (CFA) designation. Todd is also a holder of the Chartered Investment Manager Designation (CIM). Todd has a diverse range of capital markets experience. He began his career working with the Provincial Treasury, the arm of the Ministry of Finance that is responsible for borrowing and financing activities for the Province. There he priced and issued fixed income securities while working alongside the capital markets group. He built the risk management model that guided the $400M BCIIF fund and advised its board on investment decisions and risk management. He left his role, as Project Manager in Corporate & Project Finance, with the Ministry of Finance to join a global macro currency hedge fund. In his role with the hedge fund he built and coded an automated trading system which managed currency and commodity trading activity. The system was managed by a strict quantitative risk management algorithm that he developed.
Todd has been an active market participant for over 15 years and today relies on his extensive education, namely as a CFA Charterholder, to make prudent investment and associated risk management decisions for clients.
The fund’s objective is to earn positive absolute returns with a lower level of risk compared to traditional equity funds. We seek to minimize drawdown risk whilst retaining the upside of equity-like investments.
Todd believes that it is possible to take less portfolio risk and make superior returns. His philosophy centres on the team’s ability to build a diverse portfolio of less than perfectly correlated positions. In theory, they are able to reduce variance (portfolio risk) without sacrificing returns. A concept known as Markowitz diversification. Ideally, the less than perfectly correlated portfolio positions also possess elements of asymmetric risk/reward. This allows them to benefit disproportionately when right. Simply put, this means that for each dollar at risk they hope to make far more than just a dollar in return.
The Global Macro Core Fund is designed to function as a core portfolio solution. The fund is risk targeted, meaning the focus is on managing downside risk rather than targeting a particular return level. The negative deviation deemed acceptable for the strategy in a given calendar year is (15%). Constraining risk to such a level is believed to be attainable through superior risk management achieved by a mix of long and short positions (the pairing of risk), as well as through asymmetric risk/reward trades where at all possible. The GMCF seeks positive absolute returns regardless of market conditions. As it’s namesake suggests, the GMCF is agnostic to geography and will seek investment opportunities where valuations are attractive.
Similarly, it uses currencies, futures, options and/or rates to achieve its stated risk management and return objectives. When seeking equity investments the preference is for a mix of value and growth. When looking for opportunities on the short side, valuation is an input – but more importantly we seek companies engaged in fraudulent behaviour or that we believe to be mis-guiding investors as to future return prospects. As such, those equities present a better asymmetric risk/return proposition than a security that is simply overvalued.