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BNN MARKET CALL: BILL HARRIS

BNN-Business News Network

Bill Harris is partner & portfolio manager at Avenue Investment Management. Today we look at their equity portfolio composite.

Portfolio Stats

Management Fee: 1.5%

Top Five holdings

Bell CDA 4.64% 2016

First Capital 5.34% 2013

Toronto Dominion

Rogers Communications

Royal Bank

Performance

FundS&P/TSX
1 mo.-1.73 %-2.95%
3 mos.-6.55% -10%
6 mos.-26.5%-31.6%

Past Picks (Jan. 17, 2008)

Sherritt International

(S-T) - still owns

Then: $13.58 Now: $2.87, -78.9%

Total return: -78.4%

Arawak Energy (AAK-T)

major shareholder takeover at $1

Then: $2.29 Now: $0.97, -57.6%

Total return: -57.6%

Red Back Mining (RBI-T)

Sold & bought Agnico last fall

Then: $7.92 Now: $7.28, -8.1%

Total return: -8.1%

Total Return Average: -48.0%

Top Picks

Canadian Natural Resources (CNQ-T)

The company has great management and is a low-cost producer. We feel that the current share price discounts most of the risk associated with its debt level.

Sherritt International

7.75 per cent 2015 Bonds

The bonds currently yield 13 per cent. The ability to service the debt is based on fixed-price term contracts for coal in western Canada.

Pacific Rubiales

8 per cent 2013 Bonds

The bonds yield 20 per cent. The company has an appropriate amount of debt given the size of the asset base. The production break-even cost is around $25 a barrel of oil.

Market Outlook

The current environment offers a risk-adjusted opportunity to invest incorporate bonds. Avenue's equity portfolio is now 33-per-cent weighted in this asset class.

BNN-Business News Network presents Market Call live Monday to Friday at 12:30 p.m. ET/9:30 a.m. PT. To send a question to upcoming guests, e-mail marketcall@bnn.ca.

© 2007 The Globe and Mail. All rights reserved.

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