David Sykes, the new chief investment officer with TD Asset Management Inc. (TDAM) knows markets are currently tough to navigate. But, armed with “a lot of coffee” and an awareness of the issues facing portfolio managers and investment advisors, he’s ready to lend an ear and his investment expertise.
Effective Friday, Sykes succeeds industry and firm veteran Robert Vanderhooft in his new role. He’s worked at TD since 1999, most recently serving as managing director and head of public equities.
Coming into the CIO position, Sykes knows how exhausting the past two years have been for investment professionals. “It’s been a really tumultuous two years for everybody,” with the pandemic and global strife causing “wild swings” in the real estate, equities, fixed-income and commodities spaces, he said during an interview with Investment Executive.
On top of that, he added, interest rates are going to rise — though “they won’t go to the moon” — plus there’s “an inflation problem, this horrible war and I don’t think Covid is done with us.”
To get a lay of the land, one of Sykes’s first jobs will be touching base with the entire investment team at TDAM (made up of 220 employees, including both portfolio management and analyst support roles) to ensure they have the resources they need to assist clients and generate consistent but “superior risk-adjusted” returns.
That team will continue to focus on blue-chip, high-quality business models and investments, he said, though all opportunities will be considered. “At the end of the day,” Sykes noted, “it’s really focused on ‘Are these companies positioned in such a way that they can handle what comes at them, whether that’s competitors or the world or a pandemic?'”
Advisors, too, offer an important view. “We talk to [TD’s] investment advisors as much as possible about our environment and positioning, and what changes we’re making and what we’re thinking,” Sykes said.
What will keep changing under his leadership is the breadth of investment options available.
“[My career and this appointment] has coincided with a change at the firm,” Sykes said. “We used to be primarily a fixed-income shop and then we built out our equity capabilities, and now we have a lot more to offer and it’s an exciting time to assume the role.”
He specifically highlighted the bank’s “strong” asset allocation group as well as the 2018 buy of Greystone Managed Investments Inc., which has boosted TDAM’s alternatives offering. Sykes also noted the growth in retail clients versus institutional investors — a point that was recently highlighted in a research report from strategic consulting firm Indefi.
Also very much on the horizon is the expansion of ESG investment strategies. From his perspective, “a lot of people recognize the E, and they’re just starting to recognize and appreciate the S and G as well” in terms of how broad and effective such strategies can be.
All of this considered, Sykes said a main goal is to offer as broad a suite as possible while pulling in new assets.
“We’re here and we want to grow,” Sykes said, suggesting that the firm can do better at letting existing and new clients know about TDAM’s capabilities.
The asset management businesses at TD were managing $453 billion as of Dec. 31, 2021. That includes TDAM and U.S.-based Epoch Investment Partners Inc.