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Macroeconomics and Diversity in Human Capital at Mount Murray Investment

As part of his extensive experience with various prominent companies, Vincent Dostie served as Vice-President of Investments for a multi-family firm. There, he hired portfolio managers, led business development and oversaw asset allocation for some forty wealthy Québec families. He remained interested in investment analytics and decision-making, so his flagship project was to establish an independent asset management firm. The first few team meetings of this Montreal startup, which was incorporated in 2016, took place on Mount Murray, one of Mount Royal’s three hills.

Vincent founded Mount Murray Investment with two former colleagues from Caisse de dépôt et placement du Québec (CDPQ). “It takes a great deal of courage to start your own business independently, and my previous opportunities working at investment startups were extremely rewarding, helping me in progressively reaching this important decision,” the firm’s CEO and Co-Chief Investment Officer (CIO) mentions. 

Vincent Dostie
CEO and Co-CIO

The intellectual challenge in investment was a key factor for Vincent when choosing his field of expertise. The fast-paced markets, analytical work and limitless research involved, as well as the joy of implementing one’s ideas, are all aspects that prompted him to pursue a career in this industry. “You get hooked once you’ve worked at CDPQ, where you have access to all the resources in the world to stay ahead in the global investor market,” he points out. “You see it when you speak to new graduates, how this line of work actually makes people dream, as you can truly surpass yourself if you’re really well organized and you work efficiently.”

A Higher Viewpoint

While he was working with startups, Vincent thought about investing further in emerging markets, which is still a key strategy for Mount Murray Investment today. “Keith Porter, the company’s Co-CIO, was in charge of a large CDPQ team that was focused on investing in these markets,” Vincent relates. “It’s a rather rare expertise in Montréal and it’s great for investors to be able to seek advice directly from a seasoned local manager, to explain what emerging markets are exactly,” he says. “As well, for an asset manager who invests significant amounts of money for clients, it’s always helpful to get a sense of the character of the people you invest with, and this is easier to do when you’re dealing with a local firm.”

A highly inclusive organizational culture is another one of Mount Murray Investment’s assets. To build a team with a wide range of skills, the firm pays special attention to applicant selection and employees’ engagement in internal discussions. “Everyone has their place, whatever their level of experience, and I would say we have a modern vision when it comes to investment,”  Vincent states.

The firm aims the structured integration of large amounts of data to its macroeconomic analysis, based on a top down approach, in addition to the fundamental research conducted by its team of analysts and managers about portfolio companies. “Emerging markets are seen in many different countries worldwide, and we feel value may be added through a strong macroeconomic structure to help pinpoint certain regions that may be more promising at times,” Mount Murray Investment’s CEO remarks.

Also, as an emerging portfolio management firm, the company naturally has an innovative outlook because it’s currently developing its own methods and processes, as well as its team. “Many studies have shown that emerging portfolio managers generate better returns than those with more established assets,” Vincent reports.

In keeping with a style that is firmly rooted in today’s reality, Mount Murray Investment addresses the new American President’s focus on the climate crisis in the firm’s latest newsletter. “We would like to think 2020 was the year of the ultimate recognition of ESG priorities. This new emphasis will benefit various sectors of our portfolios.”

Peaks in Value for the Client

Along with competitors of the industry, the firm must face the downward pressure on asset management costs. “This is partly caused by passive investments, i.e. Exchange Traded Funds (ETFs),” Vincent observes. Since the company specializes in emerging markets and targets the addition of significant value compared to its core index, assessing risks and adopting a long-term perspective, it can justify its current fees. “In fact, you should ask yourself if during an entire stock market cycle, your clients’ returns minus your expenses are higher than those of the market, because if that’s not the case, they should have of course simply opted for an ETF,” the firm’s CEO concludes.

Acquiring a critical mass of assets under management for cash flow is evidently another one of the challenges faced by new investment firms such as Mount Murray Investment, and this firm places a lot of value on the quest for talent as well. “Because we have a small, specialized team, and each member of this team plays a major role, it is essential we find people with the right, complementary skill sets, and design an excellent onboarding and long-term training program,” Vincent explains. “In terms of raw talent, we are so lucky in Montréal, there are professionals with diverse skills and backgrounds, from good universities, and we’re able to hire people from countries where we invest, which is really interesting.”

One of Mount Murray Investment’s growth objectives is the optimization of its analytical systems in order to track a growing number of data, as efficiently as possible and in real time. The firm also wants to set up international research teams, while maintaining a vibrant central team in Montréal. All this to continue to provide clients with the best returns possible.

Mount Murray Investment’s member’s file.

To know more about the firm.

Webinaire «Montréal peut-elle devenir un centre d’excellence en IA/ML en finance et gestion d’actifs?»

Contexte et Vision
Montréal est reconnue mondialement pour son écosystème d’intelligence artificielle (IA), mais, la plupart des projets de recherche et applications sont orientés vers des secteurs non financiers. Il y a donc une lacune – «a missing link» que le projet FIAM (Forum d’Investissement Alternatifs de Montréal) vise à combler.

Ce premier webinaire d’une série d’événements organisés par FIAM avec ses partenaires, vise à recueillir commentaires et suggestions de gestionnaires de portefeuille, de chercheurs, scientistes de données, d’entrepreneurs, d’étudiants, de fintech, de dirigeants de fonds de pension, et autres parties prenantes, sur l’importance de combler ce vide. Ce qui permettrait de contribuer à la vision de FIAM de faire de Montréal un Centre d’Excellence reconnu au niveau Canadien et à l’international grâce à des affiliations / partenariats avec des organismes, universités, Instituts qui œuvrent dans le même espace.

Partie 1 :  tour de table – chacun panéliste présente comment la science des données (AI / ML) entre dans leur stratégie, processus de gestion et/ou projets – défis, succès et déception
Partie 2 : Échange type “brainstorming” sur le thème central, Est-ce important de combler ce vide? Que faire? Les Fintech ont-ils un rôle à jouer? Avons-nous le bassin de talents nécessaire? Quels devraient être les intervenants clés? Importance du maillage avec les universités etc…
– Claude Perron, Président Émérite, Gestion Cristallin et fondateur de FIAM
– Carl Dussault, PDG et fondateur, Evovest
– Jérémie Desgagné-Bouchard, Associé et Directeur scientifique, Evovest
– Karl Gauvin, Consultant en Gestion d’Actifs
– Christian Felx, Directeur, Recherche et Investissement Responsable, Desjardins
– Jean-Marc Patenaude, Président et VP Technologie, Laplace Insights

– Michael Albo, PDG et fondateur, Data Science Institute

Unearthing Alternative Treasures to Offer Optimal Diversification

Both her strong entrepreneurial drive and her desire to offer investors high-quality alternative products led Geneviève Blouin to launch the portfolio management firm Altervest in 2010.

Indeed, having first worked for major financial institutions in Montreal, including the CDPQ, the president of Altervest explains she realized there was a lack of quality in the asset class that is today at the center of her company. “I noticed there were very few interesting alternative products on the market. I also felt that derivatives were either misused or under-used. “

At that moment, Altervest’s mission and direction became clear to her: be the reference in terms of alternative investments’ integration into portfolios in order to improve their diversification, while applying prudent risk management and succeeding in obtaining maximum returns for investors at the same time.

Geneviève Blouin, CFA,CMT
President and Founder
Private Wealth & High Octane Fund

“As an entrepreneur, I thrive on challenges. What motivates me about being an independent manager is also having the flexibility to find products that are truly adapted to the client’s needs, even if they are complex. ” To illustrate what she considers to be her and her team’s role, Ms. Blouin gives the image of adventurers who explore the jungle inside out in search of unique treasures.

“It’s a long-term project. First, you have to clear the uncleared paths to find numerous managers and then meticulously study their prospectus. This sorting process essentially allows us to find managers who know how to efficiently manage risk. I don’t mind going for funds with lower performance if I see that their managers have preserved capital better than the competition during periods of major market corrections because these funds are the ones that will outperform over the long run.”

She believes that Altervest’s approach to managing its clients’ capital is characterized by innovative, disciplined, and conservative risk management, which is no small feat when it comes to alternative investments.

Winning Strategies During Tumultuous Times

Altervest focuses primarily on private wealth management, but also builds its own strategies through mandates it is entrusted with; these internal strategies helping to balance certain portfolios. Faced with market instability during a global pandemic, Geneviève Blouin considers the rigorous methods employed by her firm to be of the utmost importance. Among other things, she mentions the enviable performance of Altervest’s North American Focused Opportunity strategy. During the third quarter, the portfolio generated a return of 10.8%, well ahead of its benchmark index, composed equally of the S&P/TSX60 and the S&P500, which returned 5.6%.

“The good performance was due in part to an allocation to technology companies that do business online and strong companies that are pandemic-proof, such as Five Below (discount detail), Park Lawn (cemetery), and Check Point (cybersecurity),” says Altervest’s president.

She also indicates that the major market disruptions caused by the international spread of the coronavirus also presented a great opportunity for her team to verify whether external managers to whom they entrusted assets were indeed equipped to confront storms. Ms. Blouin recalls Warren Buffet’s famous quote: “Only when the tide goes out, do you discover who’s been swimming without a bathing suit.” Like the famous American investor, she considers difficult times as useful stress tests and has recently made good use of recent market corrections to separate the wheat from the chaff among her selection of fund managers.

Believe in the Strength of Local Managers

Geneviève Blouin, who is also the founder and Chair of the Board of Directors of the Council of Emerging Managers (EMB), argues that the position of smaller independent managers is enviable compared to that of large institutions when it comes to innovating and designing unique strategies for investors. “We have much more flexibility and fewer restrictions. This allows us to develop our expertise to the full,” says the derivatives specialist. She, herself, does not hesitate to rely on local emerging managers to manage part of her clients’ assets.

Also, Ms. Blouin believes that encouraging the proliferation of local managers in the Canadian and Quebec financial ecosystem is essential to ensure its dynamism and diversification. “This is not to say that small managers are better than large institutions, but rather to recognize their contribution to the evolution of the financial sector, notably through the contribution of new ideas, the creation of new products, and the development of technology. “

Towards a Responsible Future

With a desire to offer innovative products that meet the changing needs of investors, Altervest’s President and her team are currently working on a Canadian ESG Equity strategy that they wish to launch in January 2021. “I am a strong believer in the importance of being socially responsible and in the saying “Buying is Voting”. We are also noticing an increasing concern for the environment among our clients and we want to enable them to integrate their values into their investment strategy,” says Ms. Blouin.

She is convinced that this new product, which she particularly values, would also have a place in the portfolios of institutional investors. In fact, Altervest has already initiated discussions with the Quebec Emerging Managers Program (QEMP) to open up communication channels with them. “Just like the EMB, the QEMP helps us emerging managers carve out a place for ourselves in Quebec’s financial ecosystem because although we offer exceptional and innovative products, the challenge for a growing emerging manager is always to gain visibility,” says Geneviève Blouin.

To know more about Altervest

Altervest member’s file.