Art of Boring (Mawer Investment Management Ltd.)

A deep dive into three new holdings: Stella-Jones, Ritchie Bros., and Granite REIT, and what we mean when we say “winning by not losing.”

Our systematic assessment framework to narrow the probabilities in analysing fast-growing technology companies in an effort to improve our odds of identifying those elusive “holy compounders.”

In this episode, Peter Lampert, lead portfolio manager of the International Equity Strategy, discusses the recent Chinese stimulus and its effects on emerging markets. He highlights key long-term risks in China, including weak sentiment, regulatory challenges, and geopolitical tensions, while emphasizing the potential of companies like Tencent and Tencent Music. The conversation also covers Turkey's Bim, a discount retailer thriving amid economic uncertainty. Peter explains how the portfolio's success stems from stock selection, especially with stealth performers like Vietnam’s FPT and Taiwan’s IGS, and the importance of balancing macro risks with company-specific growth potential.

Key Takeaways:

•China's recent stimulus signals a shift from restrictive policies to boosting economic growth, leveraging the U.S. Fed's easing cycle to inject liquidity and stabilize the economy.

•The stimulus could mitigate three key challenges: weak consumer sentiment, regulatory uncertainty, and geopolitical risks. While long-term issues persist, the focus on growth reduces the likelihood of worst-case scenarios in the near term.

•Macro factors and bottom-up analysis are deeply intertwined in portfolio decisions. As risks shift, so do portfolio positions.

•Higher macro risks in China lead to applying higher discount rates and requiring better ROI. Growth projections for economically sensitive companies are adjusted lower due to structural challenges, leading to exits when valuations no longer meet the stricter risk criteria.

•Companies with independent growth drivers can perform well despite China's economic challenges, as they are less reliant on the broader economy and can thrive even in a weaker market environment.

•One example is Tencent, whose strong management, dominant WeChat position, and conservative monetization approach offer growth opportunities. Despite China's economic challenges, Tencent can pull monetization levers, making its valuation attractive amid broader pessimism.

•This year’s strong performance of the emerging markets portfolio has been driven by careful stock selection, focusing on lesser-known "stealth performers" like FPT, IGS, and Aegis Logistics, which consistently generate shareholder value.

•Peter highlighted one such performer: Bim, a Turkish discount retailer. Bim has thrived despite economic challenges. With Turkey's economic outlook improving, Bim is positioned for long-term success as it continues to offer value to consumers.

Host: Rob Campbell, CFA, Mawer Institutional Portfolio Manager

Guest: Peter Lampert, CFA, Mawer Portfolio Manager

This episode is available for download anywhere you get your podcasts.

Founded in 1974, Mawer Investment Management Ltd. (pronounced "more") is a privately owned independent investment firm managing assets for institutional and individual investors. Mawer employs over 250 people in Canada, U.S., and Singapore. 

Visit Mawer at https://www.mawer.com 

Follow us on social: 

LinkedIn -

https://www.linkedin.com/company/mawer-investment-management/ 

Instagram - https://www.instagram.com/mawerinvestmentmanagement/

CIO Paul Moroz walks us through his “best practices” portfolio construction checklist.

Director of Research and Canadian equity lead manager Vijay Viswanathan discusses the overall Canadian economy, cozy oligopolies, and the amount of foreign exposure in the portfolio.

Portfolio Manager Crista Caughlin discusses the economy and factors that drove markets in the third quarter of 2024.

Key points from this episode:

• In the third quarter, most central banks either continued cutting rates – like the European Central Bank and the Bank of Canada – or started cutting rates – like the U.S. Federal Reserve. 
• Inflation risks have diminished and downside risks to growth and employment have increased, so central banks are responding with easier policy.
• Crista believes the Bank of Canada will continue to make 25 basis point cuts at future meetings, but a 50-basis point cut is potentially on the table thanks to the Fed’s more aggressive cut.
• Because central banks are easing policy and the market expects them to continue to do so, the yield curve has started to normalize.
• All else equal, a faster, more aggressive central bank reduces the probability of a recession.
• The third quarter was a Goldilocks scenario. Growth was weak enough to allow central banks to ease policy, which is really good for bonds and interest-rate-sensitive equity sectors, but it was not so weak that there were obvious signs of a recession.
• Regardless of whether central bank easing corresponded to a recession or a soft landing, equities have historically gone higher and spreads tighter after the first central bank cut.
• One of the main questions on Crista’s mind going into the fourth quarter: How long will growth and policy be tailwinds driving the markets?

Host: Kevin Minas, CFA, MBA, CAIA, Mawer Institutional Portfolio Manager
Guest: Crista Caughlin, CFA, Mawer Portfolio Manager

For more details and full transcript visit: https://mawer.com/the-art-of-boring/podcast

This episode is available for download anywhere you get your podcasts.

Founded in 1974, Mawer is a privately owned independent investment firm managing assets for institutional and individual investors. Mawer employs over 250 people in Canada, U.S., and Singapore.

Visit Mawer at https://www.mawer.com.

Follow us on social:
LinkedIn - https://www.linkedin.com/company/mawer-investment-management/ 
Instagram - https://www.instagram.com/mawerinvestmentmanagement/

Lead portfolio manager, David Ragan, on how the team strategizes in the wake of a market shake-up (e.g., coronavirus). Also included: updates on HFDC, Seven & i, and Aon.

Portfolio Manager Samir Taghiyev discusses the current landscape of the Canadian small-cap space through the lens of the “Mr. Market” narrative and crowd-driven sentiments. Using Converge Technology Solutions as an example, Taghiyev sheds light on his team’s due diligence process and how they find opportunities by tuning out the noise.
Key points from this episode:

• The mood of the markets can change very quickly, highlighting the importance of due diligence
• Investors should be aware of market narratives but not get caught up in them
• Diligence on business, management, and valuation is key to finding opportunities created by delayed market reactions
• Small caps may see more exaggerated dynamics due to retail investor involvement

Host: Kevin Minas, CFA, Institutional Portfolio Manager
Guest: Samir Taghiyev, CFA, Portfolio Manager

For more details and full transcript visit: https://www.mawer.com/the-art-of-boring/podcast/moody-mr-market-finding-opportunities-in-the-canadian-small-cap-space-amid-changing-market-psychology-ep153

This episode is available for download anywhere you get your podcasts.

--

Founded in 1974, Mawer Investment Management Ltd. (pronounced "more") is a privately owned independent investment firm managing assets for institutional and individual investors. Mawer employs over 250 people in Canada, U.S., and Singapore. Visit Mawer at https://www.mawer.com.

Follow us on social:

Twitter - https://www.twitter.com/Mawer_Invest

LinkedIn - https://www.linkedin.com/company/mawer-investment-management/ 

In this episode of the podcast, credit analyst Curtis Elkington provides a comprehensive overview of the $50 trillion global commercial real estate market. He covers the current headwinds facing various property sectors, such as pandemic-induced challenges in the office sector and touches on the surprising resilience of the retail segment. Elkington sheds light on the complexities of the commercial mortgage-backed securities market and details the credit analysis process his team uses to evaluate potential investments with examples.

Key points from this episode:

• Over the past four years, commercial real estate as an asset class has faced potentially the most significant of headwinds, most notably the pandemic and the rise in interest rates. 
• While the pandemic had a different impact on each property sector within commercial real estate, higher rates had a much more uniform impact across the various industries.
• The overall size of the commercial real estate market, which includes multifamily, office, retail, and industrial properties, is massive. In 2023, Savills estimated the total global property value was $50 trillion, of which the U.S. is the largest component.
• Vacancy and capitalization rates are the two primary metrics used to assess the health of the commercial real estate sectors. In office, both vacancy and capitalization rates have increased significantly since 2019.
• According to the St. Louis Federal Reserve, the 25 largest commercial banks have ~$860 billion in commercial real estate loans, which is only 6% of their collective assets. All the other banks outside of the top 25 have $2 trillion in commercial real estate loans, but that accounts for 30% of their total assets.
• Over the past six months, the risk-reward on the credit side for several real estate companies was unattractive in all scenarios.
• Some market participants believe that upwards of $100 billion, or 15%, of U.S. CMBS is currently mis-rated.
• The credit team does two main things in its intensive analysis credit review. They assign a Mawer credit rating that's tied to valuation, and they establish a margin of safety that's tied to downside production.
• With commercial real estate, just like any potential investment, the team reviews each issue and issuer on a case-by-case basis following a thorough and rigorous process before committing investor capital.

Host: Rob Campbell, CFA, Mawer Institutional Portfolio Manager Guests: Curtis Elkington, CFA, Mawer Credit Analyst

For more details and full transcript visit: https://www.mawer.com/the-art-of-boring/podcast/skyscrapers-and-storefronts-insights-on-the-commercial-real-estate-market-in-2024-ep165

This episode is available for download anywhere you get your podcasts.

Founded in 1974, Mawer Investment Management Ltd. (pronounced "more") is a privately owned independent investment firm managing assets for institutional and individual investors. Mawer employs over 250 people in Canada, U.S., and Singapore.

Visit Mawer at https://www.mawer.com.

Follow us on social:

LinkedIn - https://www.linkedin.com/company/mawer-investment-management/

Instagram  - https://www.instagram.com/mawerinvestmentmanagement/

The “Swiss cheese” mental model for risk management, why we initiated in Moderna, and how to test if you have a variant perception from the broader market.

In this episode, Manar Hassan-Agha, co-manager of the Global Equity Strategy, joins host Rob Campbell to discuss applying the 'Moneyball' process in evaluating past investment decisions. They unpack the lessons learned from this approach, emphasizing long-term thinking in investment strategies. The conversation highlights critical insights from the Moneyball statistics, the importance of decision quality over short-term results, and the value of inactivity in investment management.

Key Points From This Episode:

'Moneyball' approach to evaluating investment decisions in global equity

Importance of long-term thinking in investment decisions

Understanding decision quality beyond immediate results

The role of inactivity and patience in successful investing

Insights from specific case studies, including Couche-tard and Wolters Kluwer

Reflections on past investment choices and their long-term impacts

Discussion on asset intensity in portfolio risk management

Links:

Mawer Investment Management

Co-manager of Mawer’s U.S. equity portfolio, Grayson Witcher, discusses the impact of rising corporate debt levels, the importance of relationship building with management teams, and how fighting bias is key to Mawer’s investment process.

Featuring insights from the third quarter from Balanced and Global Balanced Fund co-manager and Asset Mix Chair, Greg Peterson.

In this episode, Crista Caughlin, lead Portfolio Manager of the Canadian Bond Strategy, and Brian Carney, lead Portfolio Manager of the Global Credit Opportunities Strategy, provide their thoughts on recent economic data releases, a shift in central bank language, and recent market volatility. They delve into new issuance activity in the U.S. and Canada, widening spreads in the investment-grade and high-yield markets, and current portfolio positioning. The conversation concludes with an update on the growth and expansion of Mawer’s fixed income team.

Key points from this episode:

• Central banks have shifted their focus from solely targeting inflation to balancing inflation and growth risks, leading to the start of a global easing cycle. 
• Recession fears have increased due to weakening economic data, such as falling PMIs, rising unemployment, and weak growth, causing volatility in markets.
• It remains to be seen if recent volatility is just a pocket or something more material. If growth remains robust, it's likely just a pocket that will right-size itself. If growth continues to weaken and signs of a U.S. recession continue to pick up, it could be a larger downturn.
• The first half of the year has been smooth sailing for credit investors, but recent dislocations and changes resulted in significant widening in credit spreads.
• New issuance activity has been robust in the U.S. and Canada, with the levels of investment grade and high-yield issuance year-to-date already exceeding last year’s volumes.
• Commercial real estate has been a topical sector, but neither the Canadian bond strategy nor the global credit strategy have any direct exposure to real estate.
• In terms of where yield curves are today, parts of the curves are still inverted, particularly recession indicators.
• Both strategies hold Verizon Communications and Ford Credit Canada due to their favorable financial and operating metrics.

Host: Kevin Minas, Mawer Institutional Portfolio Manager
Guests: Brian Carney, Mawer Portfolio Manager, Crista Caughlin, Mawer Portfolio Manager

For more details and full transcript visit: https://www.mawer.com/the-art-of-boring/podcast/navigating-the-canadian-equity-landscape-dispersion-energy-transition-and-opportunities-ep163

This episode is available for download anywhere you get your podcasts.
--
Founded in 1974, Mawer is a privately owned independent investment firm managing assets for institutional and individual investors. Mawer employs over 250 people in Canada, U.S., and Singapore. Visit Mawer at www.mawer.com.

Follow us on social:

LinkedIn - https://www.linkedin.com/company/mawer-investment-management/

Instagram - https://www.instagram.com/mawerinvestmentmanagement/

In this episode, we discuss key trends and positioning in credit markets with Brian Carney, lead portfolio manager of the Mawer global credit opportunities strategy. We touch on the year’s strong performance driven by tighter spreads, higher yields, and emerging risks such as low risk premiums and the U.S. election. Topics include corporate issuance, fallen angels, and public-private credit convergence. Emphasizing capital preservation, Brian highlights portfolio positioning in high-quality, short-duration securities, such as North American bank bonds, while avoiding high-yield exposure.

Key Takeaways:

• Credit markets have performed well this year, driven by tighter spreads and higher benchmark yields, but risk premiums are historically low. Brian suggests investors prioritize capital preservation over chasing yield, avoiding high-yield bonds and long-dated credit. Post-U.S. election, vigilance is key amid potential policy-driven market shifts.
• Trends in the past quarter include fallen angels, commercial real estate risks, and potential high-yield defaults.
• An actively managed, absolute return credit strategy offers diversification, income, and potential capital appreciation while protecting against adverse credit and interest rate moves. It’s ideal for long-term investors seeking alternatives to passive strategies and opportunities in volatile or distorted markets.
• Brian recommends investors view absolute return credit as a long-term allocation, not for market timing. Market dislocations are brief, and panic often prevents opportunistic moves.
• Mawer’s portfolio is managed bottom-up, focusing on individual credit assessments to mitigate risk and seize opportunities. It prioritizes short-duration, high-quality holdings, avoids high yield, and ensures diversification with a maximum issuer cap of 10%, balancing downside risk and concentrated positions.
• Optimism abounds for long-term credit opportunities and future discussions on continued progress.

Host: Kevin Minas, CFA, MBA, CAIA

Mawer Institutional Portfolio Manager

Guest: Brian Carney, CIM
Mawer Portfolio Manager, Fixed Income

For more details and full transcript visit: https://mawer.com/the-art-of-boring/podcast

This episode is available for download anywhere you get your podcasts.

--

Founded in 1974, Mawer is a privately owned independent investment firm managing assets for institutional and individual investors. Mawer employs over 250 people in Canada, U.S., and Singapore. Visit Mawer at https://www.mawer.com.

Follow us on social:
LinkedIn -   / mawer-investment-management 
Instagram - / https://www.instagram.com/mawerinvestmentmanagement/

Lead portfolio manager, Peter Lampert, discusses the current environment for emerging markets and what opportunities and challenges we’re seeing for the portfolio.

A review of the quarter: the ongoing impacts of COVID-19 on economic activity, continuing fiscal and monetary stimulus, and the run-up to the U.S. election.

CIO, Paul Moroz, answers clients’ most frequently asked questions during these extraordinary times.

Deputy CIO, Christian Deckart, takes listeners on a journey through Mawer’s equity investment philosophy by walking through the investment thesis of four of the firm’s global small cap strategy’s top 10 holdings: Softcat PLC, Tsuruha Holdings, XP Power Ltd., VZ Holdings.

Investing legend Martin Ferguson, pioneer of the award-winning Mawer Canadian small-cap strategy shares the lessons he learned over his 33-year career.

CIO and co-manager, Paul Moroz, discusses how to build the most resilient global portfolio possible and reveals Mawer’s four building blocks to risk management.

In this episode, Grayson Witcher, the lead manager of the U.S. Equity Strategy, discusses the key drivers currently impacting the U.S. economy, including inflation, interest rates, artificial intelligence, and the upcoming presidential election. He emphasizes the importance of diversification and avoiding sharp edges—particularly during an election year. Grayson outlines the importance of and reasoning for his team’s practice of monitoring company management changes in real-time and the value of investing in companies with strong leadership.

Key Takeaways:

• The three big themes driving the U.S. market over the past six months are interest rates and inflation, artificial intelligence, and the election.
• While food, energy, and goods inflation has fallen, service inflation is proving to be a bit stickier, as it entails things like car insurance, rent, and medical services. Wage inflation has also remained relatively strong.
• With artificial intelligence, there is no denying the initial hype and surrounding success of the excitement for companies like NVIDIA. However, the question remains as to whether the trend will continue or start to fizzle out, similar to other technology trends from the 90s and 2000s.
• Regarding the upcoming U.S. election, both candidates’ agendas could impact the economy in inflationary ways, though the impacts would differ depending on the prevailing candidate.
• For Grayson, his election strategy for the portfolio is to prepare, not predict. He avoids sharp edges, which are the industries and companies that are highly dependent on one outcome, and leans into diversification.
• Within the U.S. portfolio, there are two main ways the team diversifies the single-country portfolio: diversification by geography and by industry or sub-industry.
• For long-term investors, management and culture drive a significant amount of value because they reinvest the cash flows generated by these businesses, and they are responsible for managing risk.

Host: Andrew Johnson, CFA, Mawer Institutional Portfolio Manager
Guest: Grayson Witcher, CFA, AB, Mawer Portfolio Manager

For more details and full transcript visit: https://www.mawer.com/the-art-of-boring/podcast/the-u-s-equity-landscape-inflation-artificial-intelligence-and-elections-ep166

This episode is available for download anywhere you get your podcasts.
--
Founded in 1974, Mawer is a privately owned independent investment firm managing assets for institutional and individual investors. Mawer employs over 250 people in Canada, U.S., and Singapore. Visit Mawer at www.mawer.com.

Visit Mawer at https://www.mawer.com 

Follow us on social: 

LinkedIn - https://www.linkedin.com/company/mawer-investment-

management/ Instagram - https://www.instagram.com/mawerinvestmentmanagement/

Twitter - https://www.twitter.com/Mawer_Invest 

John Wilson, analyst on Mawer’s global small cap strategy, discusses scuttlebutt’s valued place in Mawer’s investment process and its competitive advantage for long-term investors. Learn how just two phone calls can take you from Bogota to Oslo.

Fractals, raining money, and making decisions under uncertainty. CIO Paul Moroz continues the discussion of the current economic environment.

In this episode, we discuss 2024's economic landscape and what to expect in 2025, with Crista Caughlin, lead portfolio manager of the Mawer Canadian bond strategy. Crista highlights U.S. and Canadian growth trends, central bank rate adjustments, housing market dynamics, equity and fixed-income performance, and political uncertainties. She also discusses Mawer’s asset allocation strategy, balancing risks with opportunities amidst shifting fiscal policies, trade tensions, and global economic developments heading into 2025.

Key Takeaways:

• The year 2024 saw resilient U.S. growth despite headwinds, while Canada faced weaker growth and higher unemployment. Q4 showed modest improvements in Canadian growth and employment, but inflation trends potentially shifted upward in both regions late in the year.
• In 2024, the Bank of Canada aggressively eased rates, cutting 175 basis points, responding to weaker growth and target-level inflation. The Fed eased more gradually, cutting 100 basis points, as robust U.S. growth supported higher rates. Both central banks aimed to shift from restrictive to less restrictive policies.
• Political changes in Canada and the U.S. have created uncertainty for fiscal policies and trade dynamics. Tariffs pose risks to Canadian growth and inflation. Central banks remain cautious, awaiting policy clarity while navigating trade and economic interdependencies.
• The Canadian housing market faces reduced pressure due to Bank of Canada rate cuts and proactive bank measures like extended amortization. However, 2025's higher mortgage renewals at elevated rates pose ongoing risks to household spending and economic growth.
• Equity markets posted strong 2024 returns, driven by a stronger U.S. dollar, AI growth, and financial sector strength. Fixed-income returns were flat in Q4 but solid annually, with tightening spreads and rising Canadian 10-year rates prompting a defensive portfolio stance.
• The asset mix committee maintained a neutral equity stance, underweight bonds, and overweight cash in 2024, balancing hard landing concerns with market momentum. Key 2025 themes include fiscal policy uncertainty, global deficits, higher neutral rates, and opportunistic portfolio adjustments to enhance diversification.

Host: Kevin Minas, CFA, MBA, CAIA, Mawer Institutional Portfolio Manager
Guest: Crista Caughlin, CFA, Mawer Portfolio Manager, Fixed Income

For more details and full transcript visit: https://mawer.com/the-art-of-boring/podcast

This episode is available for download anywhere you get your podcasts.

--

Founded in 1974, Mawer is a privately owned independent investment firm managing assets for institutional and individual investors. Mawer employs over 250 people in Canada, U.S., and Singapore. Visit Mawer at https://www.mawer.com.

Follow us on social:
LinkedIn -   / mawer-investment-management 
Instagram - / https://www.instagram.com/mawerinvestmentmanagement/

Equity analyst, Justin Anderson, walks us through the definition of intrinsic value, how we model it, and some of the ways it might be influenced by technology now and in the future.

In this episode, we discuss credit markets with Brian Carney, lead portfolio manager of the Mawer Global Credit Opportunities strategy. Brian touches on the tightening of credit spreads, risks in the leveraged loan market, and the limited compensation for high-yield bonds relative to their risks. He also reviews concerns about U.S. government credit quality, private credit profitability, and corporate policy shifts. Looking back on Mawer's GCO strategy performance in 2024, Brian highlights future plans for growth, process refinement, and team expansion.

Key Takeaways:

• Credit spreads are tightening across all markets, benefiting investors but reducing risk premiums. U.S.-centric policies support domestic companies, yet lenders may not share in the gains. Brian recommends investors avoid chasing yield in lower-quality or long-duration bonds.
• Collateralized Loan Obligations (CLOs) drive the $1.2 trillion leveraged loan market, with issuance surging in 2024. This leverage-heavy, opaque market raises concerns about risk-taking. If dislocation occurs, leveraged loans could suffer alongside high-yield bonds, making it a key area for monitoring.
• High-yield bonds offer 7% returns, but history shows adding even 25% to a portfolio can significantly increase downside risk. With only a 0.6% incremental yield benefit today, investors aren’t adequately compensated for the risk, making caution more prudent than yield chasing.
• Concerns include the U.S. government's credit quality, private credit’s profitability favoring managers over investors, and ensuring portfolio companies maintain long-term stability despite short-term policy shifts. Monitoring these factors closely remains a priority.
• Future plans for Mawer’s GCO strategy include expanding individual and institutional adoption, refining processes, leveraging technology, and selectively growing the team.

Founded in 1974, Mawer Investment Management Ltd. (pronounced "more") is a privately owned independent investment firm managing assets for institutional and individual investors. Mawer employs over 250 people in Canada, U.S., and Singapore.

Visit Mawer at https://www.mawer.com.

Follow us on social: LinkedIn - https://www.linkedin.com/company/mawer-investment-management/

Instagram - https://www.instagram.com/mawerinvestmentmanagement/ 

CIO Paul Moroz discusses some of the Research team’s 2020 learnings—highlights include the challenge of using the market as a feedback system and the “Ben Stiller Theory.”

The impacts of inflation, interest rates, and sharp currency movements on the portfolio, and the importance of leaning in to process and keeping a long-term perspective.

One year since lockdown: CIO Paul Moroz summarizes the major market themes of the past four quarters and how it has (and hasn’t) affected our process and way of looking at the world.

In this episode of the podcast, Mark Rutherford, Co-Manager of the Canadian large-cap equity strategy, discusses the current investment landscape in Canada, highlighting the wide dispersion in sector performance and the impact of central bank policies. He delves into the long-term theme of the global energy transition and its far-reaching effects on various market sectors in Canada. Insights into insurance and banking sector performance are provided, as well as examples of specific portfolio holdings within the Canadian equity strategy.

Key points from this episode:

• On the surface, healthy and attractive returns can be found across equity markets in Canada. However, there is quite a bit of dispersion under the surface.
• Year to date, top-performing sectors include energy and materials – which have been the top performers for a few years now – while telecoms, real estate, and some utility stocks are lagging the market.
• One longer-term theme that is top of mind, both for Canada and numerous countries around the world, is the ongoing energy transition.
• Long-term opportunities that Canada is well positioned for include energy production, natural resources and renewables, critical minerals, and utilities.
• AI has been a big driver of incremental change within the utilities sector. Companies like Fortis, Hydro One, and AltaGas are investing more every year and building up the rate base, which ultimately will grow their earnings over time.
• One simple heuristic Mark’s team uses when evaluating portfolio construction and portfolio holdings is to ask where they see headwinds and where they see tailwinds.
• Life insurance companies have benefited from higher interest rates and improved earnings mix, while banks are facing challenges due to slowing loan demand and higher provisions for loan losses.

Host: Andrew Johnson, CFA, Institutional Portfolio Manager
Guest: Mark Rutherford, CFA, Portfolio Manager

For more details and full transcript visit: https://www.mawer.com/the-art-of-boring/podcast/navigating-the-canadian-equity-landscape-dispersion-energy-transition-and-opportunities-ep163

This episode is available for download anywhere you get your podcasts.
--
Founded in 1974, Mawer is a privately owned independent investment firm managing assets for institutional and individual investors. Mawer employs over 250 people in Canada, U.S., and Singapore. Visit Mawer at www.mawer.com.

Follow us on social:

LinkedIn - https://www.linkedin.com/company/mawer-investment-management/

Instagram - https://www.instagram.com/mawerinvestmentmanagement/

Twitter - https://www.twitter.com/Mawer_Invest 

Deputy CIO Christian Deckart discusses natural contradictions in the portfolio and how the team plays “intellectual best ball.”

This episode, our CIO Paul Moroz considers the potential themes and catalysts that are driving negative interest rates, what that may mean for investors, and whether those signal a new, longer term paradigm shift.

On building a “global investment franchise” and balancing the trade-offs between creativity, efficiency, and process to build a consistent environment for better investment decisions.

A real time risk management discussion addressing the increasing regulatory pressures currently impacting a wide range of businesses in China.

Market drivers that stood out this quarter, where inflation is at, and an asset mix update.

Highlights:

• How markets have been climbing a “wall of worry”
• Recalling Cisco Systems and considering implications around the current concentration of tech stocks in the S&P 500
• Our thoughts on the continuing rate hikes and “soft landing” scenario
• Holding cash: what’s changed?

Lead portfolio manager, David Ragan, discusses some big picture risks (Brexit and U.S.-China trade wars) and then dives deep into the investment thesis behind LVMH and Bunzl.

Vijay Viswanathan, Mawer’s Director of Research, on the key characteristics of high performing investment teams. The discussion includes why cultivating culture can be a great competitive advantage, some performance building frameworks, and what it means to be a “steward of the jersey.”

Philip Fisher’s continuous relevance; determining fair value ranges for blitzscalers; and potentially overlooked opportunities in Russia and Kazakhstan.

Lead portfolio manager, David Ragan, discusses how the portfolio did over the past year, why some companies were more resilient than others, and what makes skepticism a competitive advantage.

Institutional portfolio manager, Rob Campbell, explains the concept of suitcase words: words into which people attribute—or pack—multiple meanings. He discusses how honing our language skills can contribute to better investing outcomes.

Inflation cycles throughout history, Keynes vs. monetarists, and why the enemy is…still us.

Features the investment insights of Mawer’s Deputy Chief Investment Officer, Paul Moroz, from his research trip to India. Paul is also co-manager of Mawer’s Global Equity and Global Small Cap strategies. In our discussion, Paul talks about the importance India’s change in administration has made to the investing landscape; explains India’s growing need for capital; shares the management meetings that left him deterred and excited; and, shines a light on why wearing shoes during company meetings might be a good idea!

David Ragan, portfolio manager of Mawer’s international equity strategies, discusses his—perhaps surprising—views on investing in Japan. While Dave holds some less than optimistic opinions, rest assured there are some positives: two of the portfolio’s Top 10 holdings are, in fact, Japanese. Find out why.

In this episode, we discuss the global equity strategy with Christian Deckart, chief investment officer and portfolio manager at Mawer. Christian stresses managing absolute risk over relative risk for better long-term outcomes and details Mawer’s approach to risk management, focusing on decision-making, portfolio risks, and external factors such as government debt and rising rates. He also discusses adapting to AI trends, preferring companies leveraging AI applications over infrastructure investments. He emphasizes maintaining focus on fundamentals amid evolving global and technological landscapes.

Key Takeaways:

• Effective risk management begins with a sound decision-making culture, clear accountability, and thorough evaluation of securities, portfolios, and systemic exposures to avoid unintended biases.
• Market and portfolio vulnerabilities include rising government debt, interest rate shocks, hidden real estate losses, over-specialized economies, and investor psychology driven by greed and fear. Disciplined risk management and avoiding overreliance or shortsighted behaviors in markets are important keys to success.
• While AI and semiconductor stocks dominate attention, there are overlooked opportunities in the broader U.S. market, diverse, underappreciated companies that meet rigorous criteria at attractive valuations.
• Christian highlights investments with potential to leverage AI applications for competitive advantage and long-term profitability beyond initial AI infrastructure trends.
• While the global equity strategy's absolute performance in 2024 is strong, relative performance lags the benchmark due to its different composition, particularly the focus on stable, "boring" businesses versus high-growth sectors like AI infrastructure.
• Christian attributes the global equity strategy's underperformance to its broader diversification compared to the benchmark, with a larger focus on stable, recurring businesses and less emphasis on high-growth sectors like AI, particularly in the U.S. market.

Host Name and title:
Rob Campbell, CFA
Mawer Institutional Portfolio Manager

Guest names and titles:
Christian Deckart, CFA, PhD
Director, Chief Investment Officer, Portfolio Manager

For more details and full transcript visit: https://mawer.com/the-art-of-boring/podcast

This episode is available for download anywhere you get your podcasts.

--

Founded in 1974, Mawer is a privately owned independent investment firm managing assets for institutional and individual investors. Mawer employs over 250 people in Canada, U.S., and Singapore. Visit Mawer at https://www.mawer.com.

Follow us on social:
LinkedIn -   / mawer-investment-management 
Instagram - / https://www.instagram.com/mawerinvestmentmanagement/

Why the current market environment “feels like 2030 is happening in 2020,” our perspective on the recent market recovery, and more.

In this episode, Mawer portfolio managers and analysts discuss what they fundamentally look for in a bank as an investment. Specifically, how they view banks and the industry trends, as well as local dynamics, and ultimately what makes each of these businesses both unique and attractive. David Ragan discusses Scandinavian banks, highlighting Handelsbanken's smart lending and DNB's stability. Josh Samuel analyzes DBS in Singapore, emphasizing its low cost of funds and high ROE. Grayson Witcher focuses on J.P. Morgan in the U.S., noting its strong management and unique financial assets, while Alex Romaines examines First Citizens Bank in the U.S., which capitalized on market turmoil. Mark Rutherford covers Canadian banks, noting their conservative strategies and high ROE. Siying Li discusses HDFC Bank in India, and Asim Hussain explores Mitsubishi UFJ in Japan, emphasizing their unique upward-sloping yield curve.

Key Takeaways:

• The ideal bank investment is stable, lends to reliable clients, and operates in a rational, well-regulated market. Diversification in lending, funding, and economic exposure helps prevent insolvency and builds resilience, crucial in a highly leveraged industry.
• The Scandinavian banking environment is stable and well-regulated, with rational competition and prudent lending. Banks like Sweden's Handelsbanken and Norway's DNB provide consistent returns, low loan losses, and steady growth, supported by smaller, consolidated markets and strong economic stability.
• DBS in Singapore sustains strong net interest margins and 15–16% ROE. Strong management boosts investor returns through higher payouts, reducing risks from limited growth in foreign markets.
• U.S. banks face intense competition with little brand differentiation, often competing on interest rates alone. While experienced in managing risk, they are vulnerable in recessions. Banks trade at lower valuations than other sectors due to weaker competitive advantage.
• J.P. Morgan stands out in the U.S. market due to its strong management, high returns, low leverage, and strategic acquisitions during downturns. It diversifies through unique assets, investment banking, and asset management, enhancing resilience.
• The U.S. banking industry is fragmented and competitive, with a history of crises. Fragility creates opportunities for well-managed banks trading below intrinsic value.
• Canadian banks are highly consolidated and operate with a leveraged model, lending and raising equity. They now generate significant revenue from wealth management and insurance, reducing dependence on loan spreads. Strong regulatory relationships foster stability, with banks earning attractive returns while supporting economic growth.
• HDFC Bank, India’s largest private bank, has strong management and benefits from a growing economy. With low non-performing loans and high ROE, it continues gaining market share from public sector banks, despite short-term challenges from its recent acquisition.
• Mitsubishi UFJ, Japan's largest bank, has a rich history and significant market share. With an upward-sloping yield curve and a focus on digitalization, it stands to benefit from rising interest rates, driving potential profit growth despite past challenges in the Japanese banking sector.

Host: Andrew Johnson, CFA, Mawer Institutional Portfolio Manager
Guests: David Ragan, CFA, Mawer Portfolio Manager, Joshua Samuel, CFA, Mawer Equity Analyst, Grayson Witcher, CFA, AB Mawer Portfolio Manager, Alex Romaines, CFA, Mawer Equity Analyst, Mark Rutherford, CFA, Mawer Portfolio Manager, Siying, CFA, Mawer Equity Analyst, Asim Hussain, CFA, Mawer Equity Analyst

For more details and full transcript visit: https://mawer.com/the-art-of-boring/podcast

This episode is available for download anywhere you get your podcasts.

Founded in 1974, Mawer is a privately owned independent investment firm managing assets for institutional and individual investors. Mawer employs over 250 people in Canada, U.S., and Singapore. Visit Mawer at https://www.mawer.com.

Follow us on social:

LinkedIn -   / mawer-investment-management

Instagram - / https://www.instagram.com/mawerinvestmentmanagement/

CIO, Paul Moroz, answers clients’ questions about the current economic environment and how Mawer is positioning its portfolios.

Some of the main challenges facing the continent, what we gleaned from visiting over 45 companies, and ESG considerations that are front of mind for major European investment firms.

Highlights:

• Our thoughts on the prevailing macro concerns—e.g., inflation energy crisis
• “Collective corporate memory” and why the history of Europe is an important and unique context—particularly seen from a bottom-up perspective (e.g., Kuehne+Nagel, Lonza, Givaudan, SGS, Reckitt, Anglo American, Roche)
• Differentiation and operational effectiveness—what makes our European holdings competitive (e.g., Anglo American, Kuehne+Nagel)
• Germany’s longer-term energy outlook and potential implications for energy transition and infrastructure in Europe (e.g., Iberdrola, Shell, Equinor)
• ESG conference takeaways—the importance (and difficulty) of parsing and aggregating unstructured data, particularly for social considerations, and how we incorporate this into our investment process

Lead portfolio manager, Grayson Witcher, discusses how the team is positioning the portfolio amidst the current uncertainty.

Market swings, central bank moves, and rising interest rates. A look at Q3.

Institutional Portfolio Manager, Andrew Johnson, discusses key investment issues foundations and not-for-profits are facing in today's environment.

In this episode, Kevin Minas sits down with Crista Caughlin, Lead Portfolio Manager at Mawer, focusing on the key economic developments of Q4, including growth levels, inflation trends, and the resilience of financial markets. They speak on the nuances of the Canadian bond strategy and the impact of these economic factors on portfolio management.

Key Points From This Episode:

Volatility in Q4 with notable declines in interest rates and inflation

Marginal changes in growth, with a slight downturn in Q4

Economic resilience despite rapid interest rate increases in 2022-2023

Inflation trends: a reversal in Q4, with rates moving lower than in previous quarters

Equity markets showing solid returns, led by large-cap tech companies

Fixed income market volatility and changes in central bank policies

Anticipated re-emergence of traditional correlations between bonds and equities

Adjustments in asset allocation within Mawer's balanced portfolios

Links:

Mawer Investment Management

In this episode, host Rob Campbell and 11 colleagues on the research team engage in a comprehensive post-mortem analysis, sharing candid reflections on their decision-making processes over the past year. This episode underscores the significance of learning from both successes and mistakes, highlighting the value of vulnerability and introspection within the investment team at Mawer.

A Few Highlights:
•  Investing before comfort in competitive markets is necessary for returns
•   Less complexity in investment strategies often results in more alpha
•  Significant market changes can take longer to affect companies than expected
•  Large acquisitions are risky; patience in evaluation is key
•  Leaning harder on inductive evidence and numbers for decision-making
•  Understanding the importance of parent companies in investment decisions
•  Finding a balance in analysis depth to retain key insights without becoming lost in the details

Host: Rob Campbell, CFA, Institutional Portfolio Manager

Guests:
Christian Deckart  CFA, PhD, Mawer Deputy CIO, Portfolio Manager
Mark Rutherford  CFA, Mawer Portfolio Manager
Grayson Witcher  CFA, AB, Mawer Portfolio Manager
John Wilson  CFA, Mawer Portfolio Manager
Samir Taghiyev  CFA, Mawer Portfolio Manager
David Ragan  CFA, Mawer Portfolio Manager
Siying Li  CFA, Mawer Equity Analyst
Jeff Mo  CFA, Mawer Portfolio Manager
Curtis Elkington  CFA, Mawer Credit Analyst
Peter Lieu  CFA, Mawer Portfolio Manager
Asim Hussain  CFA, Mawer Equity Analyst

For more details and full transcript visit: [episode link]
This episode is available for download anywhere you get your podcasts.

--
Founded in 1974, Mawer is a privately owned independent investment firm managing assets for institutional and individual investors. Mawer employs over 250 people in Canada, U.S., and Singapore. Visit Mawer at https://www.mawer.com.
Follow us on social:
Twitter - https://www.twitter.com/Mawer_Invest
LinkedIn - https://www.linkedin.com/company/mawer-investment-management/

CIO Paul Moroz weighs in on recent movements in the market and how we may have “crossed the Rubicon” with respect to direct fiscal stimulus and are perhaps seeing the “collapse of the bond standard.”

David Ragan, co-manager of Mawer’s international equity strategies, discusses the current economic environment, what changes have been made to the portfolio as a result, and highlights holdings in the exciting worlds of nanotechnology, door locks, and pharmacies.

The major themes of Q4 and a look ahead to 2022.

How thinking like a deer in the forest (situational awareness) and other risk management process tinkering has helped the team. In addition, thoughts on the potential CP Rail and Kansas City Southern deal and Telus International IPO.

The deglobalization shift, long-term opportunities we’re seeing in utilities, and what’s interesting about gravel.

Highlights:

• Impacts of currency swings and a strong U.S. dollar at the portfolio and company level
• Why we’re shifting to more domestic companies: E.g., Texas Instruments, Martin Marietta, Paychex
  
• The long-term runway potential for utilities—and renewables: E.g., Southern Company, AEP, Amphenol, and Linde
• How we’re adding resiliency to prepare for any scenario: E.g., AmerisourceBergen, Hershey, Intuit, Verisk

This episode features insights from the past quarter by Greg Peterson, Portfolio Manager of Mawer’s balanced and global balanced strategies. Greg provides perspective on global trade wars, rising corporate debt levels, and the influence of central banks on markets.

A review of last quarter, the major themes and takeaways from 2022, and what’s on the horizon for the new year.

Highlights:

• How we did—and what factors impacted relative performance
• Why 2022 was difficult for Balanced investors
• Discount rates have gone up…where are valuations at?
• Inflation expectations, interest rates, labour markets, earnings, and economic growth—what’s being monitored in 2023
• Asset mix update

Mawer President and portfolio manager, Jim Hall, discusses the current market environment and the team's approach to risk management. The conversation covers what triggered the vast volatility and uncertainty seen in markets, potential scenarios to come, and what the team at Mawer is doing about it. He emphasizes the importance of staying calm, being prepared, and diversifying portfolios to manage risks.

Host: Andrew Johnson, CFA, Institutional Portfolio Manager 

Guest: Jim Hall, CFA, MBA, President, Portfolio Manager

This episode is available for download anywhere you get your podcasts.

Founded in 1974, Mawer Investment Management Ltd. (pronounced "more") is a privately owned independent investment firm managing assets for institutional and individual investors. Mawer employs over 250 people in Canada, U.S., and Singapore.

Visit Mawer at https://www.mawer.com.

Follow us on social: 

LinkedIn - https://www.linkedin.com/company/mawer-investment-management/ 

Instagram - https://www.instagram.com/mawerinvestmentmanagement/ 

A review of the quarter: how we’re positioning our portfolios and what investors should keep in mind during these volatile times.

Top highlights from the team’s recent research trips and a few business models we’re excited about.

Highlights:

• Insights from visiting Norway, the Netherlands, Kazakhstan, India and some holdings—Equinor, AutoStore™, Ahold Delhaize, Adyen, Genmab, Kaspi, Weir, HDFC Bank
• Why we’ve been reducing our weight in China and our current thinking around regional exposures
• The unique competitive advantages of Compass Group and Chugai
• Current and future implications of AI for the portfolio and different business models—NVIDIA, TSMC, ASML, Samsung, RELX, Wolters Kluwer, Teleperformance

A deep dive—right to the atomic level—of how semiconductors work and the potential implications for the industry when Moore’s Law comes to an end.

Highlights

• The transistor—a brief history
• What is a semiconductor? Why are they special? (Hint: atomic-level, laser precision manufacturing)
• HSMC, ASML, Amazon, KLA, Samsung—what the end of Moore’s Law might mean for various businesses in the semiconductor value chain
• Potential impacts to global productivity
• Will Rob continue to be underwhelmed by iPhone upgrades?

Equity analyst, John Wilson, shares how the team approaches separating signal from noise, why defensive business models make for a resilient portfolio, and the advantages of a “cookie-cutter” growth runway in a slowing market environment.

As markets continue on a dynamic trend, fixed income portfolio manager Crista Caughlin discusses the economy and factors that drove markets in the first quarter of 2024. In addition, the reemergence of a more typical correlation pattern between stocks and bonds, getting central banks off the sidelines, and the concern that markets may be being too complacent.

Key points from this episode:

• Global growth improving, inflation moderating, and earnings relatively strong
• In Canada, growth has improved although consumption remains weak when compared to the U.S.
• Moving with caution: strong data has begun to cause central banks to be cautious around timing of interest rate cuts—they want to be confident higher inflation is in the rear view mirror
• Strong equity markets—a continuation of the 2023 technology-focused businesses doing particularly well, especially if they have a tie in to AI or semiconductors
• Too much complacency? We may not have seen the full impact of higher interest rates, and you can see that in some areas we are seeing continued pressure (e.g., real estate, mortgage arrears, loan delinquencies)

Host: Kevin Minas, CFA, Institutional Portfolio Manager
Guests: Crista Caughlin, CFA, Mawer Portfolio Manager
For more details and full transcript visit: https://www.mawer.com/the-art-of-boring/podcast/quarterly-update-q1-2024-ep152
This episode is available for download anywhere you get your podcasts.
--
Founded in 1974, Mawer is a privately owned independent investment firm managing assets for institutional and individual investors. Mawer employs over 250 people in Canada, U.S., and Singapore. Visit Mawer at https://www.mawer.com.
Follow us on social:
Twitter -  / mawer_invest
LinkedIn -   / mawer-investment-management

In this episode, we discuss market insights with two representatives from the trading desk: Rita Tien, who trades the Americas from Toronto, and Peter Dmytruk, who trades Asia from Singapore. Rita and Peter highlight the complexities of trading, emphasizing the importance of regional differences and the role of the trading desk in executing investment decisions. They discuss the impact of the Japanese carry trade, the shift to T+1 settlement cycles in the U.S. and Canada, and the influence of ETFs and retail investors on market volatility. They also touch on the role of multi-strategy hedge funds and the challenges of managing market risks. The conversation underscores the need for long-term investment strategies and the importance of understanding market structures and dynamics.

Key Takeaways:

• The trading desk plays a critical role in executing investment decisions effectively, navigating market nuances and regional differences.
• Market events like U.S. elections and Fed rate decisions significantly impact markets, requiring traders to discern meaningful signals from noise. While short-term volatility is challenging, the focus remains on executing trades aligned with long-term strategies.
• The Japanese carry trade impacts markets, influencing businesses and structured products. Sudden market moves, like Japan's interest rate hike, highlight the importance of communication to assess potential impacts on investment theses.
• In the U.S. and Canada, the shift to T+1 settlement reduces settlement risk and margin requirements by accelerating fund transfers but adds complexity for global trades due to mismatched settlement cycles.
• Market volatility is influenced by zero-day options, high-frequency trading, retail investor activity, and leveraged ETFs. Retail-driven markets such as India, Korea, and Taiwan showcase momentum-driven dynamics, while recent SEC rules aim to protect retail investors and improve liquidity access for institutional players.
• ETFs significantly influence market dynamics, concentrating liquidity and volume, especially during closing auctions, where up to 20% of daily trading occurs. This impacts trade timing, crowding in top-weighted stocks, and creates potential price distortions affecting subsequent trading days.
• Multi-strategy hedge funds, or "pod shops," drive market overcrowding by leveraging similar strategies, such as M&A arbitrage or index rebalancing. This amplifies market risks, creates volatility during downturns, and provides opportunities for disciplined long-term investors amid rapid shifts.
• Crowded, momentum-driven trades fueled by leverage and quantitative models can create challenges for disciplined investors, though opportunities arise in volatility. Balancing exposure to popular names with underappreciated companies can mitigate risks while benefiting from structural market inefficiencies.

Host Name and title:
Rob Campbell, CFA
Mawer Institutional Portfolio Manager

Guest names and titles:
Peter Dmytruk, CFA, P. Eng.
Trader

Rita Tien
Equity Trader 


For more details and full transcript visit: https://mawer.com/the-art-of-boring/podcast

This episode is available for download anywhere you get your podcasts.

--

Founded in 1974, Mawer is a privately owned independent investment firm managing assets for institutional and individual investors. Mawer employs over 250 people in Canada, U.S., and Singapore. Visit Mawer at https://www.mawer.com.

Follow us on social:
LinkedIn -   / mawer-investment-management 
Instagram - / https://www.instagram.com/mawerinvestmentmanagement/

In this episode, we discuss the early months of the new U.S. administration with Grayson Witcher, lead portfolio manager for the U.S. equity strategy at Mawer. Grayson touches on the impact of tariffs, including the practical and unpredictable aspects of tariffs and how they influence decision-making. Grayson also shares insights on the potential long-term effects of the AI boom and highlights recent portfolio adjustments in response to evolving market dynamics.

Key Takeaways:

• The market initially surged post-election but has since reversed, with the S&P 500 dropping below election day levels. Policy shifts have hit sectors like pharma, defense, and life sciences. Volatility is rising, inflation concerns persist, and consumer caution is growing. [00:01:34]
• The current investment approach focuses on avoiding industries most exposed to tariffs, such as autos, agriculture, and luxury exports. Short-term risks include inflation and declining consumer confidence, while long-term consequences are harder to predict. Tariffs may push foreign competitors to innovate and expand globally. [00:07:01]
• When thinking about the impact of AI on the market, the U.S. equity team focuses on identifying at-risk industries and long-term beneficiaries. Instead of betting on specific AI technologies, they invest in broader themes. [00:15:45]
• While the portfolio remains largely stable, they have made minor changes due to advances in AI and current market volatility, exiting companies due to the anticipated impact AI will have on them. [00:17:33]

As global tensions rise and deglobalization trends continue, demand for enhanced border security and cargo inspection is increasing. A recent portfolio addition is OSI Systems, a security screening company specializing in cargo, airport, and venue security. [00:21:25]

Founded in 1974, Mawer Investment Management Ltd. (pronounced "more") is a privately owned independent investment firm managing assets for institutional and individual investors. Mawer employs over 250 people in Canada, U.S., and Singapore.

Visit Mawer at https://www.mawer.com.

Follow us on social: LinkedIn - https://www.linkedin.com/company/mawer-investment-management/

Instagram - https://www.instagram.com/mawerinvestmentmanagement/ 

Deputy CIO, Christian Deckart, discusses everything from big picture risks to company specifics on this global equity portfolio episode.

In this episode, we discuss the U.S. mid-cap landscape with Jeff Mo, manager of the U.S. mid cap equity strategy at Mawer. Jeff touches on risk management, emphasizing disciplined adherence to investment philosophy and the benefits of balancing risk and return through natural contradictions, like pairing discretionary consumer-focused SharkNinja with countercyclical firms such as FTI Consulting. Additional topics include preemptive risk management, maintaining an all-weather portfolio, and leveraging a robust inventory process to adapt.

Key Takeaways:

• In a hot market, risk management means resisting the temptation to chase speculative trends or high-growth fads without competitive advantages. Instead, it requires disciplined adherence to an investment philosophy—prioritizing quality businesses with strong fundamentals and sustainable value.
• Purposeful diversification includes inherent contradictions, ensuring steady wealth creation across interest rate cycles by balancing companies benefiting from both low- and high-rate environments.
• Despite recent market volatility and election-related uncertainties, the focus remains on maintaining an all-weather strategy. The team continues to evaluate companies based on fundamentals and earnings, with no drastic portfolio adjustments needed during this time.
• Inventory is crucial for risk management, providing a range of high-quality, pre-analyzed options. Mawer’s extensive, multi-stage inventory process ensures quick access to companies with competitive advantages, allowing for strategic, timely decisions based on evolving market conditions.
• To illustrate natural contradiction, Jeff shares details on specific holdings. SharkNinja's competitive edge lies in its rapid product development, allowing market share growth despite its consumer discretionary risks. To balance, the portfolio includes companies like FTI Consulting and CACI, which thrive in different market conditions, providing stability through natural contradictions.

Host: Rob Campbell, CFA
Mawer Institutional Portfolio Manager

Guest: Jeff Mo, CFA
Mawer Portfolio Manager

For more details and full transcript visit: https://mawer.com/the-art-of-boring/podcast

This episode is available for download anywhere you get your podcasts.

Founded in 1974, Mawer Investment Management Ltd. (pronounced "more") is a privately owned independent investment firm managing assets for institutional and individual investors. Mawer employs over 250 people in Canada, U.S., and Singapore.

Visit Mawer at https://www.mawer.com.

Follow us on social:

LinkedIn - https://www.linkedin.com/company/mawer-investment-management/

Instagram - https://www.instagram.com/mawerinvestmentmanagement/

Digging into last year’s performance drivers, the current opportunity set, and benefits of resuming boots-on-the-ground research.

Highlights:

• A review of the market and our strategy’s performance in 2022 and three key learnings
• Why we exited Kakao, and some of the new additions to the portfolio: Salik, Vesta
• Risks we’re monitoring—and managing: China-U.S. tensions over Taiwan and geographic exposure in the portfolio
• The power of pricing power (see: TSMC) and types of ESG considerations that we look for in our investments (Petro Rio)
• How a shared investment philosophy and process makes for better decision making—e.g., Lonza, Hikma

Featuring third quarter insights from Greg Peterson, portfolio manager of Mawer’s balanced and global balanced strategies. Greg provides perspective on emerging markets, the implications of rising interest rates, and USMCA (NAFTA 2.0).

A deep dive into key themes we’ve been focusing on, recent additions to the portfolio, and a few changes.

Highlights:

• Quick recap: What has changed with the portfolio since 2022?
• What we mean by “engaged owners” (and the difference they can make)
• Why we are looking for companies with lower duration
• How we try to find a variant perception from the market—and some examples
• Recent additions to the portfolio: Dermapharm, Donnelley Financial, Hikma, Ipsos, SoftwareONE, and Technogym
• Our new approach to the reverse roadshow process

Director of Research and Canadian equity lead manager, Vijay Viswanathan, discusses risks and opportunities in Canada, the cannabis industry’s value chain, and potential transformations to the food retailer business model.

CIO, Paul Moroz, walks listeners through the reasons why going global is optimal in today’s environment. He discusses the paradigm shift from a closed world to globalization, how home bias is often a pure investing error, and how assessing stocks on a “brick by brick” basis may be better than pulling on a country “lever” in balanced portfolios.

Featuring insights from the first quarter from Balanced and Global Balanced Fund co-manager and Asset Mix Chair, Greg Peterson.

A review of the quarter: a significant rebound in markets, the potential impacts of continuous monetary and fiscal stimulus, and deglobalization.

Portfolio Manager Peter Lampert breaks down the decision to re-open the strategy to new institutional investors and the key inputs that determine the strategy’s capacity. In addition, “a tale of two acquisitions”: one head scratching, the other improving the investment thesis of the holding.

Key Points From This Episode:

• Breaking down the decision to re-open the strategy to new institutional investors
• How the team determines the strategy’s capacity
• A puzzling acquisition by KDDI and a potential value creating acquisition by Novo Nordisk
• Evaluating the implications of rising interest rates on real estate investments
• The balance needed to sift through the hype around AI while still being open to opportunities

Host: Rob Campbell, CFA, Institutional Portfolio Manager
Guest: Peter Lampert, CFA, Mawer Portfolio Manager

For more details and full transcript visit: [episode link]
This episode is available for download anywhere you get your podcasts.

--
Founded in 1974, Mawer is a privately owned independent investment firm managing assets for institutional and individual investors. Mawer employs over 250 people in Canada, U.S., and Singapore. Visit Mawer at https://www.mawer.com.
Follow us on social:
Twitter - https://www.twitter.com/mawer_invest
LinkedIn - https://www.linkedin.com/company/mawer-investment-management/

CIO Paul Moroz discusses how we’ve approach building resilient global portfolios over the years, the new “Cold War” between China and the U.S. and its wider reaching impact, and how “the real money’s in the holding.”

Chief Investment Officer, Paul Moroz, reflects on notable learnings from 2021 and how time and experience still clarify the most in investing—and life.

Equity analyst John Wilson discusses how decentralized organizations can maintain agility and operational excellence as a defense to the negative aspects of change.

Lead Portfolio Manager, Crista Caughlin, on what’s happening in bond markets, a look at inflation and interest rates, and the key scenarios we’re monitoring.

Vice President of the Community Foundations of Canada, JP Bervoets, explains the UN’s sustainable development goals—and how individuals and corporations can get on board to make a difference.

Chief Investment Officer Paul Moroz shares takeaways from the Research team's annual post-mortem discussions.

Highlights:

• The cyclical—and long-term—aspect to investment learnings
• Why interest rake hikes were a big factor and topic of conversation
• “Fishtailing” and the difficulties of trying to right-size information
• How emotional intelligence makes for better decision making
• “Simplify, clarify, focus” and offsetting the toll of complexity in processes

Exploring the why behind the FAANG’s outsized stock returns and the overall challenges of valuating tech companies.

Why our team locks themselves in a room for a week to speak with over 30 management teams: to drive focus and attention on the companies that are going to have the best chance of meeting our investment criteria.

iTunes description:

A close look at our research methods to understand trends, opportunities, and challenges in the pharmaceutical industry.

Crista Caughlin, lead portfolio manager of Mawer’s fixed income strategies, discusses potential impacts of increasing global debt in a low interest rate environment and the three economic scenarios top of mind for the bond team.

Portfolio Manager Wen Cheong debunks the perceived challenges of investing in the emerging market space, highlighting his team’s concentrated approach and candour. He details how his focus on best-in-class management and passion for identifying attractive valuations has powered returns.

Key points from this episode:

• Small-cap companies are a pond with fewer rocks; opportunities can be found in steady, established businesses with competitive advantages.

• The slump in semiconductor demand in 2023 was primarily driven by a normalization in post-pandemic demand and macro challenges leading to an inventory de-stocking cycle.

• The EM team makes decisions for the portfolio entirely on a bottom-up basis with a slight macro overlay.

• Even in areas with geopolitical uncertainty, opportunities can be found in well-run, high-quality companies with attractive valuations.

• The emerging markets space remains full of diverse opportunities for those willing to do the deep dive.

Host: Rob Campbell, CFA, Institutional Portfolio Manager

Guest: Wen Cheong, CFA, Portfolio Manager

For more details and full transcript visit: https://www.mawer.com/the-art-of-boring/podcast/fishing-in-less-crowded-ponds-identifying-opportunities-in-emerging-markets-ep155

This episode is available for download anywhere you get your podcasts.

--

Founded in 1974, Mawer Investment Management Ltd. (pronounced "more") is a privately owned independent investment firm managing assets for institutional and individual investors. Mawer employs over 250 people in Canada, U.S., and Singapore. 

Visit Mawer at https://www.mawer.com. 

Follow us on social: 

Twitter - https://www.twitter.com/Mawer_Invest 

LinkedIn - https://www.linkedin.com/company/mawer-investment-management/

This episode, we interview our Head of Information Security and Infrastructure, Dwight Pratt, and Equity Analyst, Karan Phadke, on the ramifications of technical debt to businesses and investors.

Impacts of higher inflation and interest rates and the benefits of an integrated research team.

Inflation risk, slowing global growth, and the un-globalization trend—a review of Q3.

In this episode, we explore the growing electricity demands of data centers stemming from artificial intelligence (AI) with Chris Silvestre, Analyst on the U.S. Equity Team. He shares insights from a recent research trip visiting data centers in Northern Virginia—the data center capital of the world—and discusses challenges around meeting demands given constraints of land availability, energy generation and transmission, and the significantly increased power demands required to develop large language models.

Key points from this episode:

• Electricity demand in the U.S. has been relatively flat for a decade but is expected to increase 25% by 2050 due to electrification, ESG goals, and data center expansion to meet AI demand.

• For the same footprint and the same data center, you need 10 times more power for AI workloads than you did for the old-style data centers.

• Data centers cluster organically in hubs, such as Northern Virginia, to minimize data transfer costs, but this clustering strains power infrastructure.

• Meeting increased data center capacity demands faces land and energy constraints. While the U.S. has the ability to generate power, it may not have it in the right spots at the right time to support this new incremental demand.

• Businesses are proactively responding to increased demand by signing deals to secure data center capacity despite constraints, while governments are implementing policies and reforms to support AI development.

• With respect to AI or high-performance computing, there is a sense that this is a priority and will be a matter of national interest if not national security.

Host: Andrew Johnson, CFA, Institutional Portfolio Manager

Guest: Chris Silvestre, CPA, CFA, Equity Analyst

For more details and full transcript visit: https://www.mawer.com/the-art-of-boring/podcast/watts-up-the-challenges-and-opportunities-of-powering-ai-ep158

This episode is available for download anywhere you get your podcasts.

Founded in 1974, Mawer Investment Management Ltd. (pronounced "more") is a privately owned independent investment firm managing assets for institutional and individual investors. Mawer employs over 250 people in Canada, U.S., and Singapore.

Visit Mawer at https://www.mawer.com.

Follow us on social:

Twitter - https://www.twitter.com/Mawer_Invest

LinkedIn -

https://www.linkedin.com/company/mawer-investment-management/

Instagram - https://www.instagram.com/mawerinvestmentmanagement/

Why small caps may zig while large caps zag, the advantage of businesses that sell scarce skills (CBIZ, Insperity, RS Group), and why eyewear retail is harder than it…looks.

The tremendous IPO activity led by tech companies; our evaluation process for a company prior to it becoming public; and recent matrix meeting outcomes for the portfolio.

U.S. portfolio manager, Grayson Witcher, discusses the sustainability of U.S. earnings, some of the major position changes over the past two years, and overall team learnings.

Equity trader, Jeff Wilson, delves into the in-house “B-E-E-P” framework the trading team has built: Best Execution, Education, and Process. “To achieve the most consistent amount of positive outcomes, you can't actually impact the outcome, but you can impact the process that develops outcomes.”

Director of Research and Canadian equity co-manager, Vijay Viswanathan, discusses potential trade war impacts to the portfolio, Canada’s opportunity set, and dives deeper into holdings in the energy, e-commerce and insurance industries.