Beta Portfolio Management

The mandate of the Beta Portfolio Management group is to take a long-term view and collect risk premia in global markets as consistently as possible while minimizing portfolio drawdowns. The Beta Portfolio Management group captures risk premia across multiple asset classes using the cash and derivative markets. The Beta Portfolio Management group is comprised of two teams, with one team responsible for research and the other team responsible for trading and liquidity management.

Global Equities & Hedge Fund Management

Global Equities

The Global Equities group manages a diversified portfolio of developed market global equities with discretion to invest opportunistically in emerging markets. The group’s strategy is to invest in securities of well-managed companies where we believe our research gives us a differing perspective on the economics of the business, where there is significant upside from the current market price to our estimate of the intrinsic value of the business, and where the risk-to-reward trade-off is attractive. A long-term, cash- flow driven valuation approach is used to determine intrinsic value. The aim of the Global Equities group is to invest in companies that meet our return thresholds over a long-term investment horizon in a concentrated, absolute return portfolio.

Equity research provides the fundamental investment insights that drive the Global Equity portfolio. Building a world-class, industry-based investment team is the cornerstone of the Global Equities group’s strategic plan, including plans for global research sector funds, which are currently being launched. The Global Equities team also supports OMERS Capital Markets execution of its strategic plan, which includes an initiative to significantly increase our internal equity management capabilities, reduce external management expenses, and provide industry expertise to OMERS private entities, while enhancing portfolio returns for the OMERS Fund.

Hedge Fund Management

Based in the OMERS Worldwide New York office, the Hedge Fund Management group is committed to generating consistent and strong risk-adjusted returns. Through rigorous investment and operational due diligence, and prudent risk management, the Hedge Fund Management group strives to build a portfolio that generates consistent, positive absolute returns irrespective of market conditions. To accomplish this objective, the group constructs a hedge fund portfolio that is invested in a wide variety of instruments such as equities, bonds, currencies, derivatives and private investments, and that utilizes both traditional and innovative investment strategies.

Fixed Income & Currency

The mandate of the Fixed Income group is to manage a diversified, multi-sector exposure to global fixed income assets within OCM’s broader Alpha platform. The group seeks to maximize absolute returns across all market environments in the context of prudent investment risk management. The group’s investment process is well-defined, combining top-down macroeconomic analysis with bottom-up credit research in the development of portfolio strategy. Credit analysis is undertaken by OCM’s internal credit research team in the identification of profitable investment opportunities and management of credit risk. Customized analytical and quantitative tools complement the portfolio management and risk oversight functions.

The Currency team is responsible for the management of OCM’s Active Currency program, a pure Alpha strategy providing absolute returns and diversification across Beta and Alpha mandates. The team’s investment process combines fundamental research within a discretionary framework – an adaptive strategic approach that delivers positive returns across alternative investment regimes and risk environments.

The Currency team also acts in an advisory capacity with respect to currency management across the OMERS organization in the pursuit of global investment opportunities.

Global Macro & Quantitative Investments

The mandate of the Global Macro group is to manage a diversified exposure to liquid global public market assets. Opportunities are identified through a systematic evaluation of global macroeconomic and financial trends relative to market pricing. The portfolio of exposures is constructed to maximize the diversification benefit and avoids concentrated positions within and between asset classes. The Global Macro group has two objectives: first, to achieve above-market returns over the long-term, regardless of market conditions; and second, along with other active management programs, to diversify the earnings profile of OMERS Capital Markets.

The objective of the Quantitative Investments group is to generate a return in excess of a relevant benchmark while controlling risk against the relevant benchmark. The group believes that fundamental economic and behavioural factors drive short-term security price movements. Through research, we identify the primary factors that drive these price movements and position our portfolio to benefit from them. We construct our portfolios to create exposure to these primary factors to maximize the risk-adjusted return.

OCM Risk Management

The OCM Risk Management group is responsible for bringing an integrated approach to risk management across all of OCM’s portfolios. This starts with understanding the investment philosophy and strategies for each of our portfolio mandates. The group’s approach does not distinguish between internally and externally managed portfolios. We believe that risk is owned at the portfolio level and it is our group’s responsibility to assist with understanding those risks, including understanding how these risks aggregate at the total OMERS Capital Markets level. Full reliance is not placed on quantitative measurements as we believe that qualitative analysis is a critical factor in providing a more comprehensive picture of exposure to investment risk. Accordingly, the group utilizes insights from many sources to understand the macroeconomic and business cycle context in which our portfolios are managed. The group also performs in-depth research to provide general insights into the long-term drivers of asset class returns, and specific insights into particular capital market questions raised within OMERS Capital Markets. The objective of the OCM Risk Management group is to combine a qualitative understanding of market and macroeconomic risks with a quantitative risk analysis to advise OMERS Capital Markets portfolio management teams on ways to construct their portfolios to more efficiently achieve risk-adjusted returns that meet OMERS pension promise.