Episode 93 – Quarterly Equity Update
April 14, 2022

Episode 93 – Quarterly Equity Update

In this episode Geoff Scott, Senior Vice President Investments, is joined by David Barr, CEO and Portfolio Manager of the Pender Small Cap Opportunities Fund and Felix Narhi, Pender’s Chief Investment Officer and Portfolio Manager of the Pender Global Focused Fund and Pender Strategic Growth and Income Fund.

Subtitle: The trinity of risk and big value paying decisions.

In this episode Geoff Scott, Senior Vice President Investments, is joined by David Barr, CEO and Portfolio Manager of the Pender Small Cap Opportunities Fund and Felix Narhi, Pender’s Chief Investment Officer and Portfolio Manager of the Pender Global Focused Fund and Pender Strategic Growth and Income Fund. They revisit last quarter’s performance and the headwinds faced, especially in small cap and tech sector equity. They discuss the trinity of risk, being balance sheet risk, valuation risk and business risk, and in particular the team’s thoughts about valuation risk, which has decreased in the last year and made for an interesting investment environment.

Key Takeaways

[02:35]David provides his perspective on how the current macro factors, such as rising inflation and interest rates and the war in Europe are impacting the markets, Pender’s equity universe and the team’s investment strategy. Felix expands on why it’s important to keep a long-term perspective during turbulent times such as these.
[05:01]David and Felix elaborate on Pender’s take on the trinity of risk and discussion goes into detail on the shift in valuation risk and where they are seeing opportunities right now.
[09:53]David also talks about balance sheet risk – there’s the traditional balance sheet and then there’s how to assess a technology company’s balance sheet.
[13:38]Geoff asks Felix and David to provide examples of holdings that fit within their risk assessment parameters.
[19:25]The conversation shifts to Pender’s Small/ Mid Cap Dividend Fund and Strategic Growth and Income Fund. The team discusses the performance of these funds which hold more traditional cash flow businesses, and a few of the holdings in these funds.
[25:18]The team provides a book recommendation and continues the discussion on what they are doing to better prepare themselves for future volatility.
[29:33]David and Felix close by referencing Pender’s investing process, the rapidly changing market landscape and their overall thoughts on positioning of their funds and the future.