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Portfolio Construction

Setting Strategic Asset Allocation

Bounty uses its analysis of the global economy to determine the relative value of equity to fixed income. This sets the medium to long-term strategic asset allocation. Careful consideration is given to inflation expectations and the real (inflation adjusted) return expectations. This approach helps preserve purchasing power over the long run. After determining the appropriate mix of stocks and bonds, we then choose the best sectors and companies using our “bottom up” approach.

Bounty identifies individual equities at buy points which coincide with intermediate market lows thereby improving the prospects for immediate price improvement or reward potential. Bounty's research uncovers cyclically and historically undervalued equities (in terms of P/Es) in out-of-favor, but improving industries. Dividends are also an important part of our investment strategy. In addition to dividend paying securities, we may include investments such as income trusts and REITs.

Fixed income
Bounty includes fixed income to help preserve capital and may overweight the asset class if inflation adjusted yields are favorable. We generally invest in high quality government securities.

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