Scotia Managed Companies structures and manages investment products that provide exceptional return opportunities to investors and offers a range of different investment products. Some of these products provide low cost diversification, while others provide leveraged participation in individual companies or portfolios of companies. We have a great deal of experience and dedicated resources in this investment area, and offer excellent products. We currently manage Net Assets of $787 million as at January 31, 2017.
Each Scotia Managed Company and Trust has a board of directors that represents shareholders/unitholders and monitors the performance of the companies/trusts. Scotia Managed Companies Administration Inc. provides all of the ongoing administration for the companies and trusts.
To buy and sell shares/units of these companies/trusts, you need to place orders through an intermediary, such as a broker, who will convey your instructions to the stock exchanges, and keep you informed of the status of your orders. In exchange, brokers charge a fee or commission, usually a percentage of the transaction (the number of shares/units or the total money involved, subject to a minimum fee).
Each Scotia Managed Company is publicly listed and has been designed to provide a specific investment opportunity. The companies are marketed through brokers and are formally launched through an initial public offering (IPO). Funds from the IPO are used to invest in the underlying securities. A fixed number of shares/units are issued and traded on the Toronto Stock Exchange.
One of the structures that Scotia Managed Companies distributes are Split Shares. Split Shares "split" the investment returns on a portfolio of stocks into a lower risk dividend stream and a leveraged play on the price of the portfolio. Capital appreciation on the underlying portfolio is for the benefit of the capital shares, while the dividends received from the underlying portfolio, are paid to the holders of the preferred shares. Split Shares are either based on individual shares, such as R Split III (Royal Bank) and BNS Split II (Bank of Nova Scotia), or on portfolios of common stocks such as Allbanc (Canadian Banks) and Top 20 Dividend Trust (20 highest yielding equity securities included in the S&P/TSX 60 Index). Capital Shares provide a leveraged return based on the performance of the underlying portfolio, are RRSP, RRIF, RESP, TFSA and DPSP eligible and provide leverage without the risk of margin calls, or variable borrowing costs.
Scotia Capital Inc.
The Trusts and Corporations, created and administered by Scotia Managed Companies, are produced by a team consisting of investment banking professionals, capital markets experts and investment executives of Scotiabank's Global Banking and Markets division. Robert Hall, Managing Director, Structured Products for Scotia Capital Inc., has primary responsibility for the area.
All of the Scotia Managed Companies are assembled using cross functional teams that address the capital markets, trading, research and brokerage aspects of the product. The resulting companies are screened through a combination of the practical judgment of our teams and advanced quantitative research techniques. We hope the excellent record of these funds will continue as we introduce new companies every year. We look forward to bringing you further gains from your investments in Scotia Managed Companies.