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Daneshvar Rohinton of iA Global Asset Management Inc.The Globe and Mail

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Money manager Daneshvar Rohinton is managing each of his portfolios a bit differently, depending on economic conditions in various parts of the world.

“We’re seeing a soft landing in the U.S. and a more muted economic picture in other parts of the world such as China and Europe,” says Mr. Rohinton, vice-president and portfolio manager at iA Global Asset Management Inc. in Toronto.

“There’s more risk of an economic downturn in Canada due to higher interest rates. Our economy is more interest rate-sensitive because of our higher debt, which is trickling through the economy differently,” adds Mr. Rohinton, who manages $4.5-billion in assets across four funds, including IA Clarington Canadian Dividend Fund and IA Clarington Global Dividend Fund.

As a result, Mr. Rohinton’s team is taking a more defensive position in its Canadian fund, buying more property and casualty insurance companies and reducing its exposure to energy and consumer discretionary stocks.

“We’re taking a more balanced approach in the global fund because the global economic picture, especially in the U.S., is more neutral,” he adds.

His IA Clarington Canadian Dividend Fund returned 5.4 per cent over the past year. Its three-year annualized return was 8.9 per cent, while the five-year annualized was 7.5 per cent. His IA Clarington Global Dividend Fund, which launched in early February, 2023, has returned 14.4 per cent over the past year. The performance for both funds is based on total returns, net of fees, as of Feb. 20.

The Globe and Mail spoke with Mr. Rohinton recently about what he’s been buying and selling and a big pharmaceutical stock he wishes he hadn’t sold:

Describe your investing style.

We’re bottom-up stock pickers focusing on identifying 40 to 50 quality companies with a strong competitive advantage in their industries and an ability to grow their dividends over time. Our portfolios include a balance of growth companies and more defensive businesses that offer more stability when markets are volatile.

What’s your current cash position?

We only have about 2 per cent in the portfolios today, which is typical for us. We manage risk based on the type of companies we invest in, not by holding more cash. The most cash we ever held was 10 per cent, at the start of 2020, when the pandemic lockdowns began. We called companies to ask how the shutdowns were affecting their operations and started selling stocks and holding cash before reinvesting it later that year.

What have you been buying recently?

In our Canadian fund, we added to our position in Intact Financial Corp. IFC-T, Canada’s largest property and casualty insurance company, with a growing global footprint in the U.S., U.K. and Scandinavia. Intact is a well-managed company that allocates its high returns on equity well. It has also been deploying more capital externally, especially in the U.K. The company’s playbook has been the same for more than a decade now: to buy assets, bring them up to their return-on-equity standards, and then continue to redeploy that capital opportunistically over time while maintaining high levels of profitability across different divisions. It’s insurance done right, in our view.

In our global fund, we recently added to our existing position in Meta Platforms Inc. META-Q. The company has grown a lot over the years. It has become leaner and more cost-efficient while still investing in critical ideas and future growth opportunities. The best part about the Meta story is that its management team has matured by introducing share buybacks and recently announcing it would start paying a dividend. We bought more Meta stock on the dividend news because we see the company’s future being much better than its past.

What have you been selling or trimming?

We’ve been trimming Apple Inc. AAPL-Q over the past six months, based on valuation. We still hold the stock and think it’s a fantastic company with a dominant position in its industry. However, the stock is trading near its all-time high again while its innovation cycles are slowing.

Name a stock you wish you hadn’t sold.

A stock I wish we hadn’t sold is Novo Nordisk A/S NVO-N, the pharmaceutical giant behind the well-known diabetic and weight-loss drugs Ozempic and Wegovy. It was in our global portfolio for many years, but we sold it when we moved to iA Global Asset Management in October, 2022. We thought the valuation was high and priced into the stock. We lost track of how big the opportunity could become.

What advice do you have for new investors?

When you start investing, especially in your younger years, you can learn how different businesses work, what it takes to make them successful and how they can fail. History has a lot of lessons to show us – and often repeats itself. There’s a lot of information to digest, so try to stay passionate and interested.

The interview has been edited and condensed.

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Tickers mentioned in this story

Study and track financial data on any traded entity: click to open the full quote page. Data updated as of 17/04/24 4:00pm EDT.

SymbolName% changeLast
IFC-T
Intact Financial Corp
-0.81%219.67
META-Q
Meta Platforms Inc
-1.12%494.17
AAPL-Q
Apple Inc
-0.81%168
NVO-N
Novo Nordisk A/S ADR
+0.87%124.53

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