Hamilton Global Financials ETF (HFG), which launched on June 26, 2020, is focused on investing in high quality global financial stocks with strong balance sheets, diversified income streams and exposure to favorable, medium- and long-term cyclical and secular trends. This focus aims to provide Canadian investors with diversified exposure to the most attractive themes within the global financial sector while maintaining a volatility profile not materially…
Insights: Insurance
Financials: Does COVID-19 Represent a Growth Scare, Credit Event or Crisis?
Since we launched our first ETF in January 2016, there have been four significant macro corrections in four years. None of those large and painful corrections represented a crisis, insofar as the declines did not represent a threat to the solvency of the financial sector, either from a lack of liquidity or the destruction of capital. Rather, they were related to the market rapidly (and, in…
Notes from the Field: BofAML Insurance Conference 2016
We recently attended Bank of America Merrill Lynch’s 2016 Insurance Conference in New York, where we took in presentations by 27 insurance companies, with representatives from the life, property and casualty (P&C), reinsurance and mortgage insurance sub-sectors. Most of the companies presenting were U.S.-based (and listed), with several Bermuda and Europe-domiciled reinsurers, and a Canadian P&C insurer also in attendance. Notwithstanding the location of their headquarters,…
European Trip to London, Frankfurt, and Madrid: Notes from the Field
A recent trip to Europe – 3 days in London at a European financial services conference, and 1 day field trips to Frankfurt and Madrid – gave us an opportunity to meet with executives from more than 25 financial services companies and agencies (including 19 banks and 3 insurers) representing 9 countries. Notably, the trip reinforced our European investment thesis, although a disparity of country and…
Why the Canadian Financials Will Likely Underperform their Global Peers
We are often asked for our thoughts on the Canadian financials relative to the global financials. Regular readers of our work will know that we favour financial services companies outside of Canada. There are many reasons, but the most compelling is that the Canadian financials have fully recovered (both in terms of valuation and earnings) from the most recent cycle, while the U.S. and global financials…
Three Emerging Themes in Global Financials
A number of important themes are emerging in the financial services sector, which in North America alone includes over 1,000 companies, and over $4.5 trillion of market capitalization. Macro risks remain, but we believe that over the next 24 months, several themes offer excellent investing opportunities. Here is a description of just three…
Will Sun Life Financial (SLF-TO) Cut its Dividend?
There is something very unusual going on in the Canadian financial services sector: a large-cap financial, Sun Life Financial (SLF), is being priced for a substantial dividend cut. Even those with a cursory knowledge of Canadian financial services know that investors in the sector consider dividends virtually sacrosanct.