Montreal-based Fiera Capital Corp. (TSX: FSZ) Thursday announce the addition of two new funds to its existing product offering: Fiera Capital Defensive U.S. Equity Fund and the Fiera Capital Defensive Global Equity Fund.
The new funds “include an overlay strategy designed to capture the benefits of equity-like returns, while focusing on capital preservation,” said Sylvain Roy, chief investment officer and executive vice president, alternative strategies, in a release.
Available to all types of investors, the funds aim to provide long-term capital appreciation by investing primarily in U.S. and global equity securities through the existing Fiera U.S. and global equity funds. The Defensive Funds then employ risk and portfolio management techniques to reduce equity exposure with the goal of ensuring that downside risks are limited. Such techniques include purchasing put options to limit downside risk, writing call options to enhance long-term returns and reduce hedging costs, risk exposure targeting, and currency hedges, as well as implementing stop loss limits to reduce equity exposure.
“In the context of high price-to-earnings ratios and with volatility at historical lows, the Defensive Funds represent a timely and attractive opportunity for investors seeking downside protection while being fully invested throughout the equity market cycles,” added Roy.