Stephen Bonnyman is Co-Head, North American Equity Research and Portfolio Manager of AGF Investments Inc.’s Canadian and global resources portfolios.
Working closely with the AGF research teams, Mr. Bonnyman focuses on identifying resource companies with solid balance sheets, advantaged cost structures, attractive valuations or unrecognized growth. Mr. Bonnyman is a member of the AGF Asset Allocation Committee, or AAC, which is comprised of senior portfolio managers who are responsible for various regions and asset classes.
In this 2,856 word interview, exclusively in the Wall Street Transcript, Mr. Bonnyman explains the philosophy underlying his portfolio management:
“This fund had some challenges because we had a couple of industries that were heavily impacted by COVID. An example of that would be the energy space, which has had a bit of a double whammy. One, a large contraction in demand resulting from the COVID-19 pandemic globally.
And secondly, the massive acceleration in the renewables theme, which has started to treat the fossil fuel industry as if it was completely dead in the water, which we don’t think is entirely the case. But that would be one very real example.
Another within our investable space would be real estate, where concerns are obviously in place as to whether the work-from-home and the COVID structures that we’ve put in place to cope are going to be longer-lasting, change the nature of how we interact and how we utilize our real estate space.”
A sector shift has been apparent in 2020:
“Right now, our largest overweights would be in utilities. And that’s a reflection of two parts. One, the interest rate structure that reflects utilities. And secondly, the bulk of that exposure exists within the renewable schemes, so names like NextEra (NYSE:NEE), Boralex (OTCMKTS:BRLXF), NPI (TSE:NPI), where we’re looking at specific themes.
Where are we underweight at the moment? We are underweight real estate. Obviously, the challenges facing the market right now have not played out. And I think we’ve got to look at how many of these survived through this structure.”
Mr. Bonnyman sees an immediate opportunity in silver investing:
“I might add, SilverCrest, we own in a large part because of its valuation. This, in our eyes, was one of the most exciting exploration plays available within our sort of investable framework.
And we’ve been invested in the company for quite a long time since it emerged as a junior exploration company. So while we like silver, our ownership of SilverCrest is based more upon the exploration and development capability of the company than necessarily on its underlying commodities.
To answer your question directly, yes, we do like silver. The silver market is a combination of gold and an industrial metal. It’s sometimes referred to as gold on steroids.
As we get through the election, as we start to emerge from the pandemic, industrial demand for silver will accelerate and increase. And we think it has, in fact, a higher return potential than gold as a raw metal from this point forward.”
To get the complete interview with Mr. Bonnyman, read the entire 2,856 word interview, exclusively in the Wall Street Transcript.
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