With $60.1 billion of assets under management, our portfolio includes high-quality assets of all classes, each with a specific risk‑return profile, as well as value-add strategies that are designed to meet the important financial objectives of our clients.
IMCO Assets Under Management (Sept. 30, 2017)
Primary Asset Classes
IMCO’s public equities portfolio is composed of Canadian equities and foreign equities (including those listed in foreign developed countries and foreign developing countries).
Our team invests in shares of public companies traded on the world’s largest exchanges and manages exposure through both internal and external managers using a combination of active and index-replication strategies.
Public equities are a source of return growth for our clients. We aim to generate long-term results that are higher than the benchmark while achieving better than benchmark return-to-risk ratios (i.e. higher returns for the same, or lower amount of risk taken relative to the benchmark risk). The returns generated help our clients meet their financial obligations at a reasonable cost.
Fixed Income & Money Market
IMCO’s fixed income investments include nominal and inflation-linked bonds that are issued in Canada, foreign developed countries and foreign developing countries.
Our investments span both private and public debt markets, and across government and corporate debt. Fixed income is a stable and reliable source of income for our clients. It diversifies risk from public equities and helps moderate the impact of interest rate changes on the cost of their future liabilities.
Our team draws on economic fundamentals and market intelligence to deliver reliable performance within a robust risk management framework. We also manage exposure through both internal and external managers using a combination of active and index-replication strategies.
IMCO invests directly, and through funds, in domestic and international real estate holdings across property types and geography on behalf of our clients.
We develop and retain strategic relationships with key partners who share our view on investing prudently with a long-term view, to generate strong returns, relative to the risks taken.
Our real estate portfolio consists of high-quality office complexes, regional shopping centres, Canadian rental properties, as well as modest investments in participating mortgages. Investing in real estate is well-aligned with our objective of meeting the long-term financial obligations of our clients. It provides strong cash-flow generation and stable returns that provide useful sensitivity to changes in inflation.
IMCO’s diversified markets strategy provides a risk-controlled source of broad market returns across multiple asset classes for our clients.
We aim to deliver a well-diversified return stream that is resilient under various economic environments and that does not rely on any single asset class. The strategy is executed through direct and derivative holdings of global equities, nominal and real return bonds, credit and commodities. It is implemented through diversified mandates within a risk allocation framework, with a range of portfolio mix adjustments dependent upon economic conditions or market risk regimes.
Portfolio construction considers both historic and future risk estimates to ensure appropriate diversification of risks. This strategy is consistent with our approach of taking reasonable investment risk to generate revenues that meet the long-term financial obligations of our clients.
IMCO invests in global infrastructure assets through fund relationships and through direct investments.
Investing in infrastructure fits well with our investment philosophy of meeting our clients’ long-term financial obligations due to its predictable cash flow profile, inflation sensitivity and generation of stable returns.
Our infrastructure portfolio is diversified by geography, development stage, and contractual frameworks, and is broadly segmented across multiple sectors. This reduces our exposure to any single market or regulatory regime. Our infrastructure team invests across capital structures and has built longstanding relationships with key partners, which enable us to access world-class assets on behalf of our clients.
IMCO’s absolute return strategy is designed to capitalize on market inefficiencies and other value-creation opportunities.
We implement our strategy through investments directly in hedge funds and customized fund of hedge funds in a cost-effective format. We also allocate to absolute return active currency strategies.
The primary objective is to reduce overall volatility for our clients’ portfolios while achieving established return targets with low, or no directional, exposure to equity markets. Our approach is designed to earn positive returns that are largely uncorrelated to other asset groups. Consequently, returns are primarily driven by manager skill and not by the overall direction of the market.
We also maintain strategic relationships with managers, which enable us to access unique approaches, cutting edge research and intellectual capital. This ultimately enhances performance and diversifies risk on behalf of our clients,
IMCO’s private equity portfolio is focused on building quality partnerships. Private equity investing helps us to enhance returns for our clients by adding diversification to our overall portfolio.
It also offers greater transparency and access to the management teams of the organizations in which we invest, as well as increased governance and influence. This creates the potential for achieving higher returns.
Our team carries out direct and co-investments in organizations with well-defined strategies. We look for well-managed companies with high-potential growth prospects throughout a broad range of sectors, including consumer, biotechnology, industrials and financial services. In addition to showing strong potential, the companies in which we invest, demonstrate long-term vision. We also focus on fund investments globally that deliver strong performance and enable us to create new partnerships. Participating in strategic co-investment opportunities with some of the world's leading private equity firms, enable us to gain insight and to pursue opportunities in markets that we can't easily access directly.
IMCO manages a portfolio of private debt assets on behalf of our clients, which consist mostly of high-quality, investment and non-investment-grade, income-bearing products of various maturities that are unavailable in the public market.
These products enable IMCO to invest in private credit across the risk spectrum and capitalize on market opportunities while maintaining a focus on capital preservation and current cash yield.
IMCO’s access to investment grade private debt is primarily via North American direct fixed rate private placements. We maintain relationships with highly-experienced partners, across North America and Europe, to access non-investment-grade opportunities, which enable us to balance risk and generate reliable returns within defined maturity periods.
Tactical Asset Allocation
IMCO’s tactical asset allocation (TAA) strategy is designed to create value and manage risks on behalf of our clients.
Our TAA approach requires active management of the portfolio to take advantage of market variances, at various points in the market cycle, and to preserve capital in volatile markets.
Through our team of professionals, IMCO can make very timely TAA decisions that improves the clients’ return to risk profiles.
Investment Management Corporation of Ontario
200 King Street West, Suite 2300
Toronto ON M5H 3T4
Toll Free: 844-383-4626