AGENDA Introduction Introduction AGENDA Agenda SECURITIES - - PowerPoint PPT Presentation

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AGENDA Introduction Introduction AGENDA Agenda SECURITIES - - PowerPoint PPT Presentation

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5/9/2009 INTRODUCTION Introduction EXECUTIVE TEAM Agenda Agenda Executive Team EXECUTIVE TEAM Markin Hall & Markin Hall & Trading Floor Trading Floor TAMs Mission & TAMs Mission &

slide-1
SLIDE 1

5/9/2009 1

  • INTRODUCTION
  • Agenda
  • Executive Team
  • Markin Hall &

Trading Floor

  • TAM’s Mission &

Investment Policy

  • Investment Strategy
  • Investment Analysis
  • Competitive

Advantage

  • Conclusion
  • Taurus Team

Introduction

Srecko Ponjavic, CEO Todd Sutcliffe, CFO Justin Mayerchak, COO

Taur urus Asse us Asset Manag t Management ement

  • Taurus Team

AGENDA

  • Markin Hall
  • Securities Trading Floor
  • Executive Team
  • Introduction
  • AGENDA
  • Executive Team
  • Markin Hall &

Trading Floor

  • TAM’s Mission &
  • Our Mission & Investment Policy
  • Investment Strategy
  • Economic Situation
  • Value Investing
  • Industry Selection
  • Investment Analysis
  • Objectives
  • Back Testing

Investment Policy

  • Investment Strategy
  • Investment Analysis
  • Competitive

Advantage

  • Conclusion
  • Taurus Team

Taur urus Asse us Asset t Manag Management ment

Agenda

  • Portfolio Return
  • Competitive Advantage
  • Taurus Asset Management Team
  • Taurus Team

EXECUTIVE TEAM

  • Introduction
  • Agenda
  • EXECUTIVE TEAM
  • Markin Hall &

Trading Floor

  • TAM’s Mission &

Todd Sutcliffe CFO

VP of Analysis

Justin Mayerchak COO

VP of Strategy

Srecko Ponjavic CEO

President

Investment Policy

  • Investment Strategy
  • Investment Analysis
  • Competitive

Advantage

  • Conclusion
  • Taurus Team

Taur urus Asse us Asset t Manag Management ment

Executive Team

g

  • Value of Hard Work
  • Accountability
  • Relationship Building
  • Candidness
  • Mentoring
  • Reward Success
  • Integrity
  • Positive Attitude
  • Aim For excellence
  • Personal Connection
  • Taurus Team

MARKIN HALL & SECURITIES TRADING FLOOR

  • State of the art

educational building

  • Housing Management

F lt d F lt f

  • Introduction
  • Agenda
  • Executive Team
  • MARKIN HALL &

TRADING FLOOR

  • TAM’s Mission &

Faculty and Faculty of Health & Sciences

  • Will be one of Canada’s

foremost learning environments

  • Future home of Taurus

Asset Management Trading Floor

Investment Policy

  • Investment Strategy
  • Investment Analysis
  • Competitive

Advantage

  • Conclusion
  • Taurus Team

Taur urus Asse us Asset t Manag Management ment

Markin Hall & Trading Floor Floor

  • Real time access to

financial markets around the world

  • Taurus Team
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SLIDE 2

5/9/2009 2

TAURUS ASSET MANAGEMENT’s

Mission & Investment Policy

Mission: To create an endowment fund to be used to cover the costs associated with the Markin Hall Trading Floor and give students a competitive advantage in the work place through

  • Introduction
  • Agenda
  • Executive Team
  • Markin Hall &

Trading Floor

  • TAM’s MISSION &
  • Initial Investment = $500,000.00
  • Primary Objective = Growth of Income
  • Secondary Objective = Capital Appreciation

Investment Constraints

  • No more than 10% in any one security
  • Bond funds can consist of up to 15%

students a competitive advantage in the work place through hands on experience (managing an endowment fund)

INVESTMENT POLICY

  • Investment Strategy
  • Investment Analysis
  • Competitive

Advantage

  • Conclusion

Taur urus Asse us Asset t Manag Management ment

Mission

p 5

  • Short selling not permitted
  • No margin purchases
  • Real Estate & Private Equity not permitted TODAY
  • Taurus Team

STRATEGY: ECONOMIC SITUATION

  • Introduction
  • Agenda
  • Executive Team
  • Markin Hall &

Trading Floor

  • TAM’s Mission &
  • 5.1 Million Jobs Lost Since 2007 – Unemployment Rate: 8.5% (April, 09)
  • Consumer Confidence Index = 25.3%  Lowest Since Inception (1967)
  • GDP Q1 08 = 0.9%, Q2 08 = 2.8&, Q3 08 = ‐.05%,

EXPECTED Q4 08 = ‐5.4% ** (Worst since 1982)

  • Bail Out Money :$ 10.5 trillion allocated – $2.6 trillion Spent

Investment Policy

  • INVESTMENT

STRATEGY

  • Investment Analysis
  • Competitive

Advantage

  • Conclusion

Taur urus Asse us Asset t Manag Management ment Investment Strategy

  • $1.8 Trillion & $1.4 Trillion Deficit in 2009, 2010 (13%, 11% of GDP)
  • Obama budget could force USA to borrow 9.3 Trillion over next 10 years*

** Source: BEA. Gov * Source: Congress Budge Office (CBO)

  • Taurus Team
  • Introduction
  • Agenda
  • Executive Team
  • Markin Hall &

Trading Floor

  • TAM’s Mission &

STRATEGY: ECONOMIC SITUATION

Investment Policy

  • INVESTMENT

STRATEGY

  • Investment Analysis
  • Competitive

Advantage

  • Conclusion

ECONOMIC INDICATORS (change from 2007 – 2009) EURO UNION INDIA CHINA

UNEMP Rate

8.5% (‐9.57%) 7.2% (‐8%) 4% ‐ 9%

GDP

18.93 T $US (-1.5%) 2.966 T $US (-21.7% ) 4.22 T $US (-18%)

  • Taurus Team

Taur urus Asse us Asset t Manag Management ment Investment Strategy

GDP

( ) ( ) ( )

Inflation

1.7% (-10%) .031% (-94.6%) .08% (-88%)

SOURCES: International Monetary Fund, World Bank, CIA World Fact book, Asian Development Bank

STRATEGY: ECONOMIC SITUATION

  • Introduction
  • Agenda
  • Executive Team
  • Markin Hall &

Trading Floor

  • TAM’s Mission &
  • Unemployment Rate = 7.7% ‐ approx 300,000 jobs lost in past 4 months
  • Oil Price = $52.10 (‐64% since high of $147 per barrel)
  • Natural Gas = $3.801 (‐65% since high of approx $11.50 per MBtu)
  • Consumer Price Index = 1 4%

Investment Policy

  • INVESTMENT

STRATEGY

  • Investment Analysis
  • Competitive

Advantage

  • Conclusion

Taur urus Asse us Asset t Manag Management ment Investment Strategy

  • Consumer Price Index = 1.4%
  • Gross Domestic Product = ‐1.7%
  • NO FINANCIAL BAIL OUTS – only bridge loans
  • Taurus Team
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SLIDE 3

5/9/2009 3

STRATEGY: INDUSTRY SELECTION

FOSSIL FUELS

  • Oil, Natural Gas, Coal
  • Introduction
  • Agenda
  • Executive Team
  • Markin Hall &

Trading Floor

  • TAM’s Mission &
  • Alberta’s vast resources

AGRICULTURE

  • Long term threat – water availability

TRANSPORTATION

  • Decreased gas prices; highly correlated with economy

ALTERNATIVE ENERGY

Investment Policy

  • INVESTMENT

STRATEGY

  • Investment Analysis
  • Competitive

Advantage

  • Conclusion

Taur urus Asse us Asset t Manag Management ment Investment Strategy

ALTERNATIVE ENERGY

  • Massive potential in alternative energies, long term
  • Solar Power, Bio Fuels, Wind Power, Hydro Electricity
  • Taurus Team

STRATEGY: INDUSTRY SELECTION

CHEMICAL

  • Petrochemicals, Fertilizers, Inorganics, Specialty / Fine
  • Introduction
  • Agenda
  • Executive Team
  • Markin Hall &

Trading Floor

  • TAM’s Mission &

g p y

  • Sector has outperformed others since Sept 2007

HEALTHCARE

  • Bio‐tech, Pharmaceuticals, Life Sciences
  • Defensive in nature

INFORMATION TECHNOLOGY

  • Highly correlated with economic conditions

Investment Policy

  • INVESTMENT

STRATEGY

  • Investment Analysis
  • Competitive

Advantage

  • Conclusion

Taur urus Asse us Asset t Manag Management ment Investment Strategy

FINANCIAL

  • World stimulus required
  • Rules and regulations will change going forward
  • Taurus Team

STRATEGY: VALUE / TIME HORIZON

From Economic Analysis, Two Conclusions Made: V l I i S

  • Introduction
  • Agenda
  • Executive Team
  • Markin Hall &

Trading Floor

  • TAM’s Mission &

Value Investing Strategy

  • Investors have lost nearly half their wealth since ’07
  • Many securities are undervalued because of large systematic

risk, not because of firm profitability

  • We have developed a unique qualifying process utilizing VIS

Time Horizon Specific Strategy

Investment Policy

  • INVESTMENT

STRATEGY

  • Investment Analysis
  • Competitive

Advantage

  • Conclusion

Taur urus Asse us Asset t Manag Management ment Investment Strategy

  • Focus locally, regionally & defensively in the Short Term (2 years)
  • Diversify internationally & higher beta equities Long Term (5+ years)
  • Taurus Team

ANALYSIS: EXPECTED RETURN

Primary Objective: Growth of Income

  • Introduction
  • Agenda
  • Executive Team
  • Markin Hall &

Trading Floor

  • TAM’s Mission &

y j

  • Cover costs of trading floor – payout 6.2% annually
  • Dividend & Coupon Payments

Secondary Objective: Capital Appreciation

  • Assumed inflation of 2.56% (10 yr CPI avg +.5%)
  • Capital Appreciation is expected to be 1.75%

Investment Policy

  • Investment Strategy
  • INVESTMENT

ANALYSIS

  • Competitive

Advantage

  • Conclusion

Taur urus Asse us Asset t Manag Management ment

Analysis

Overall Expected Return = 10.5 % Year over Year

  • Taurus Team
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SLIDE 4

5/9/2009 4

ANALYSIS: HISTORIC RETURNS

  • Introduction
  • Agenda
  • Executive Team
  • Markin Hall &

Trading Floor

  • TAM’s Mission &

Investment Policy

  • Investment Strategy
  • INVESTMENT

ANALYSIS

  • Competitive

Advantage

  • Conclusion

Taur urus Asse us Asset t Manag Management ment

Analysis

  • Taurus Team

ANALYSIS: SELECTION CRITERIA

RETURN ON ASSETS DEBT TO EQUITY BETA

  • Introduction
  • Agenda
  • Executive Team
  • Markin Hall &

Trading Floor

  • TAM’s Mission &

RETURN ON EQUITY PRICE/EARNINGS RATIO SHARPE RATIO DIVIDEND YIELD MARKET CAPITALIZATION STANDARD DEVIATION CURRENT RATIO TRADING RELATIVE NEWS

Investment Policy

  • Investment Strategy
  • INVESTMENT

ANALYSIS

  • Competitive

Advantage

  • Conclusion

Taur urus Asse us Asset t Manag Management ment

Analysis

CURRENT RATIO VOLUME RELATIVE NEWS

** Quality of Earnings

  • Taurus Team

ANALYSIS:

SELECTION CRITERIA IN ACTION

  • Introduction
  • Agenda
  • Executive Team
  • Markin Hall &

Trading Floor

  • TAM’s Mission &

SELECTION CRITERIA COMPANY PERFORMANCE INDUSTRY AVERAGE MARKET CAP 24.15 B $US N / A RETURN ON ASSETS 35.01% 13.77% RETURN ON EQUITY 64 01% 29 46%

Investment Policy

  • Investment Strategy
  • INVESTMENT

ANALYSIS

  • Competitive

Advantage

  • Conclusion

Taur urus Asse us Asset t Manag Management ment

Analysis

RETURN ON EQUITY 64.01% 29.46% NET PROFIT MARGIN 37% 13.40%

  • Taurus Team

ANALYSIS:

INDUSTRY BREAKDOWN

  • Introduction
  • Agenda
  • Executive Team
  • Markin Hall &

Trading Floor

  • TAM’s Mission &

Investment Policy

  • Investment Strategy
  • INVESTMENT

ANALYSIS

  • Competitive

Advantage

  • Conclusion

Taur urus Asse us Asset t Manag Management ment

Analysis

  • Taurus Team
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SLIDE 5

5/9/2009 5

ANALYSIS: ASSET ALLOCATION

2% 2%

Asset Allocation

  • Introduction
  • Agenda
  • Executive Team
  • Markin Hall &

Trading Floor

  • TAM’s Mission &

28% 39% 29% 2% % US Equity CAN Equity Investment Policy

  • Investment Strategy
  • INVESTMENT

ANALYSIS

  • Competitive

Advantage

  • Conclusion

Taur urus Asse us Asset t Manag Management ment

Analysis

US Fixed EUR Equity Cash

  • Taurus Team

ANALYSIS: ASSET ALLOCATION

18%

Expected Return by Asset Class

  • Introduction
  • Agenda
  • Executive Team
  • Markin Hall &

Trading Floor

  • TAM’s Mission &

15.63% 8.62% 5.67% 6.23%

4% 6% 8% 10% 12% 14% 16%

Investment Policy

  • Investment Strategy
  • INVESTMENT

ANALYSIS

  • Competitive

Advantage

  • Conclusion

Taur urus Asse us Asset t Manag Management ment

Analysis

0% 2% 4%

Canadian Equity US Equity International Equity US Fixed Income

  • Taurus Team

ANALYSIS:

SYNTHETIC BENCHMARK

SYNTHETIC BENCHMARK

  • Introduction
  • Agenda
  • Executive Team
  • Markin Hall &

Trading Floor

  • TAM’s Mission &

SYNTHETIC BENCHMARK

CATEGORY WEIGHT BENCHMARK US Equities 28% S&P 500 Index Canadian Equities 39% S&P/TSX Composite Index European Equities 2% FTSE EUROTOP 100 Index

Investment Policy

  • Investment Strategy
  • INVESTMENT

ANALYSIS

  • Competitive

Advantage

  • Conclusion

Taur urus Asse us Asset t Manag Management ment

Analysis

American Bonds 29% Vanguard Total Bond Market Index Cash 2% 10 Year Canadian CPI Average

  • Taurus Team

ANALYSIS: BACK TESTING

YEARLY PORTFOLIO RETURNS

  • Introduction
  • Agenda
  • Executive Team
  • Markin Hall &

Trading Floor

  • TAM’s Mission &

YEARLY PORTFOLIO RETURNS 2006 23.66% 2007 22.72% 2008

  • 5.6%

Investment Policy

  • Investment Strategy
  • INVESTMENT

ANALYSIS

  • Competitive

Advantage

  • Conclusion

Taur urus Asse us Asset t Manag Management ment

Analysis

  • Average return during back testing was 13.6% ,

far exceeding our required rate of return

  • Taurus Team
slide-6
SLIDE 6

5/9/2009 6

ANALYSIS:

TIME SERIES ANALYSIS

  • Introduction
  • Agenda
  • Executive Team
  • Markin Hall &

Trading Floor

  • TAM’s Mission &

800,000.00

Portfolio historical returns (2006-2008)

Investment Policy

  • Investment Strategy
  • INVESTMENT

ANALYSIS

  • Competitive

Advantage

  • Conclusion

y = 257.55x - 9E+06 R² = 0.8823 550 000 00 600,000.00 650,000.00 700,000.00 750,000.00 Portfolio historical returns (2006-2008) Linear (Portfolio historical returns (2006- 2008))

Taur urus Asse us Asset t Manag Management ment

Analysis

  • Taurus Team

450,000.00 500,000.00 550,000.00 17/02/2005 24/03/2006 28/04/2007 01/06/2008 06/07/2009 ))

ANALYSIS: EFFICIENT FRONTIER

CML

  • Introduction
  • Agenda
  • Executive Team
  • Markin Hall &

Trading Floor

  • TAM’s Mission &

CML

Investment Policy

  • Investment Strategy
  • INVESTMENT

ANALYSIS

  • Competitive

Advantage

  • Conclusion

TAM PORTFOLIO

Taur urus Asse us Asset t Manag Management ment

Analysis

  • Taurus Team

ANALYSIS:

PORTFOLIO CHARACTERISTICS

SHARPE RATIO 10.35

  • Introduction
  • Agenda
  • Executive Team
  • Markin Hall &

Trading Floor

  • TAM’s Mission &

BETA 0.7 DIVIDEND YIELD 4.48% EXPECTED INCOME GENERATION $22,393.42 Per Year

Investment Policy

  • Investment Strategy
  • INVESTMENT

ANALYSIS

  • Competitive

Advantage

  • Conclusion

Taur urus Asse us Asset t Manag Management ment

Analysis

EXPECTED PORTFOLIO RETURN 10.5% or $52,500 PY

  • Taurus Team

COMPETITIVE ADVANTAGE: MARKETING COMPONENT

Marketing Students

  • Add marketing arm to Org. Structure

k ll

  • Introduction
  • Agenda
  • Executive Team
  • Markin Hall &

Trading Floor

  • TAM’s Mission &
  • Marketing team will attract investment

Tax Receipts

  • Will be provided for donations to SEF

Enhance Student Learning

  • Will aid in training finance (marketing) professionals

Unique Trading Floor Experience

Investment Policy

  • Investment Strategy
  • Investment Analysis
  • COMPETITVE

ADVANTAGE

  • Conclusion
  • Taurus Team

Taur urus Asse us Asset t Manag Management ment

Competitive Advantage q g p

  • Attract students to Management Faculty

Alberta Appeal

  • Focus investment in Alberta
  • Taurus Team
slide-7
SLIDE 7

5/9/2009 7

CONCLUSION

Presentation Summary: Markin Hall / Trading Floor

  • Both will provide competitive advantage for students
  • Introduction
  • Agenda
  • Executive Team
  • Markin Hall &

Trading Floor

  • TAM’s Mission &
  • Both will provide competitive advantage for students

and University

Economic / Industry Analysis

  • Value Investing
  • Time Horizon Specific Strategy

Security Analysis / Portfolio Goals

  • 10.5% return annually; more then sufficient

Investment Policy

  • Investment Strategy
  • Investment Analysis
  • Competitive

Advantage

  • CONCLUSION
  • Taurus Team

Taur urus Asse us Asset t Manag Management ment

Conclusion

5 y;

Competitive Advantage

  • Marketing aspects
  • Taurus Team

TAURUS ASSET MANAGEMENT TEAM

  • Introduction
  • Agenda
  • Executive Team
  • Markin Hall &

Trading Floor

  • TAM’s Mission &

Investment Policy

  • Investment Strategy
  • Investment Analysis
  • Competitive

Advantage

  • Conclusion
  • TAURUS TEAM

Taur urus Asse us Asset t Manag Management ment

Taurus Team

  • TAURUS TEAM