Palos Equity Income Fund

For daily performance, please visit globefund.com or morningstar.com

Please note that commissions, trailing commissions, management fees and expenses all may be associated with mutual fund investments. Please read the prospectus before investing. The indicated rates of return are the historical annual compounded total returns including changes in unit value and reinvestment of all distributions and do not take into account sales, redemption, distribution or optional charges or income taxes payable by any securityholder that would have reduced returns. The Fund is not guaranteed, its value changes frequently, and past performance may not be repeated.

Efficient Portfolio Strategy

The Palos Equity Income Fund is a mutual fund sold by prospectus, available to all Canadian residents. This Fund attempts to mirror the investment strategies of our flagship fund, the Palos Income Fund L.P.

This fund is eligible to be held in both non-registered accounts and registered accounts such as an RRSP or TFSA.

Long-biased
Dividend equity focused
Canadian (Some US)
Theme driven
Fundamental analysis
Company management meetings and onsite visits
Medium to long term holding period
Dynamic asset allocation
Large & mid capitalization

Fixed Income Strategy

Provides investors with a steady stream of income generated from a portfolio’s balance
Bonds, preferred stocks, and CD’s all pay a steady dividend and interest payments
Consistent cash inflows

Service Providers

PALOS MANAGEMENT INC.
Order Management System	SGGG Fund Services Inc.
Administrator, Transfer Agent and Record Keeper	SGGG Fund Services Inc.
Auditor (firm and funds)	PricewaterhouseCoopers LLP
Legal Counsel	Faskens
Prime Broker and Custodian	NBIN

More Information

The Management Process

The Investment Committee

Involves daily meetings to remain up to date with current news. Additionally, it includes the discussion of economic factors, company specific factors, investment themes, and investment rationale.

Our Approach

Involves conducting Bloomberg research & analysis, external research, fundamental analysis. Includes meetings with management, such as on-site visits and analyst meetings with experts.

Review and Reassessment

Involves monitoring portfolio weightings, analyzing market movements, stock screening, additional fundamental analysis, and risk management. Further revision and adjustments are made if needed.

Step 1

Step 2

Step 3

The Monitoring Process

Value At Risk (VAR)

VAR is used to analyze equity market risk during all market hours. VAR is targeted to be equal to or lower than the TSX.
Monte Carlo Simulation estimates expected equity shortfall by sector against the TSX benchmark

Stress Tests

Scenario Analysis/Stress Test used during periods of market volatility to better understand the portfolio under various adverse market conditions

Exposure

Gross, net exposure, leverage and cash are monitored (metrics provided by SGGG, front office system).

Liquidity

90% of the portfolio can be liquidated within 1 day

Operational Risk

Front office system SGGG provides transparency on all trades since January 1, 2013
Third party fund administration, recordkeeping and NAV valuation by one of the world’s largest independent administrators
Independent annual audit of firm and funds done by a major international firm. Business Continuity Plan and Internal Control and Compliance Manual are in place