Préfontaine Capital’s investment style is based on tried and tested conservative principles seeking capital preservation and long-term growth of clients’ portfolios. We avoid any investment we consider speculative or pretending to generate a quick profit. Each client’s risk profile and particular needs are analyzed and a tailor made investment policy is established, containing amongst other things an asset allocation program which frames investment decisions.

Fixed income securities

We view the two basic functions of fixed income securities as first to provide clients with their ongoing income needs, and secondly as a way to reduce the volatility of portfolios, since fixed income securities are generally negatively correlated with the stock market. We restrict our investments to quality bonds and preferred shares, rated A (P-2) or better. We offer a simple and prudent management, giving our clients the double advantage of minimized tax consequences and the best rates and inventory of the institutional market.

Publicly traded shares

Our management style for common shares has its roots in the “value” approach to fundamental investing. We invest in first class quality companies on a contrarian basis, in situations where we believe the stock price is temporarily below its intrinsic value, while leaving ourselves a margin of safety in the establishment of this value. We seek to minimize risk by diversifying in different sectors and limiting our purchases to companies meeting our investment criteria. A solid understanding of a company and its competitive environment is required in order to distinguish a temporary setback in its results from a more permanent downward trend in its prospects. When we are convinced of our analysis, we invest for the long-term, and capitalize the dividends, thus minimizing portfolio turnover for a superior after-tax return.

To learn more about our investment philosophy, please contact us