Skin in the game

WP talks to Wealhouse senior portfolio managers Justin Anis and Andrew James Labbad about the recent performance of two of the company's signature funds – and what sets it apart as an asset manager

Skin in the game

If there’s one thing Justin Anis and Andrew James Labbad have in common – other than being senior portfolio managers for investment management firm Wealhouse – it is that their careers have involved a certain amount of baptism by fire.

“I joined Wealhouse on September 1, 2008,” Anis remembers. “And then, two weeks into the job, the entire market crashed. So that taught me some lessons. I think it’s fair to say that those early experiences were quite formative and led me to develop the type of strategy I run today, which is very much about managing risk. I saw a lot of people suffer tremendous financial losses through that period, and I never want to put my clients through that kind of volatility.”

Labbad, meanwhile, kicked off his time at Wealhouse during a far more recent global catastrophe – the COVID-19 pandemic. Yet his passion for the role saw him through.

“I was excited about the opportunity in the depth of the pandemic to join Wealhouse and launch a new credit fund,” Labbad says. “Joining an asset manager with a great repu-tation was the best way for me to pursue my passion for investing. I now have the flexibility as a portfolio manager to take a long-term approach, and the opportunity to make an impact to grow our investors’ wealth, which is fulfilling to me.”

Anis and Labbad are at the helm of two of Wealhouse’s most prestigious funds: the Lions Bay Fund and the Amplus Credit Income Fund. The Lions Bay Fund is an award-winning North American equity fund that combines a core portfolio of long-term investments in high-quality companies with a transactional portfolio that generates returns through tactical trading strategies, plus a hedging portfolio that employs a disciplined risk management strategy to protect investors from market declines.

“It was the three-year anniversary of Lions Bay just a couple of weeks ago,” Anis says. “The fund has delivered about 14.8% annualized returns, net of costs. And it’s done that with 42% less volatility than the S&P 500. Those are the goals I was trying to achieve. I wanted to target equity-like returns with significantly lower volatility – and the fund has outperformed in every major monthly drawdown that the S&P 500 has had since then. So I guess I’d say it has certainly been stress-tested by the market. I’m happy with how the strategy has performed. I think for high-net-worth individuals who are looking for peace of mind, it’s a type of strategy that makes sense.”

The Amplus Credit Income Fund, mean-while, aims to maximize returns in a rising market while also protecting investors from market risk in a downturn. It subscribes to a flexible investment style, primarily investing in debt securities such as bonds, preferred shares and convertible notes, seeking to capitalize on market inefficiencies and mispricing while minimizing interest rate exposure.

“Since its inception in July 2020, Amplus has produced +29% growth for investors after cost,” Labbad says. “Most fixed income indices are negative during that timeframe due to rising interest rates. As a result, we have been successful in outperforming our peer group.”

Amplus focuses mainly on investment-grade credit, Labbad adds. “We hedge out most interest rate risk, and we look mainly at the credit profile of companies and invest in their debt. We have a flexible mandate that enables us to invest in different parts of the capital structure, including preferred shares and equity. We actively hedge the overall exposure of the portfolio in times of volatility. Our investors are impressed that returns have been positive every month since inception.”

While Anis and Labbad are the driving forces behind each fund, they are quick to point out that the Wealhouse ethos informs their investment style.

“Wealhouse has four main advantages,” Labbad says. “First, we are nimble and lean, able to quickly react to opportunities. Second, we have great relationships with banks and dealers who provide access to deal flow, liquidity, ideas, execution and great time-sensitive opportunities. Third, as a boutique, we provide a personalized approach to our investors, who have direct access to the investment managers influencing their money. Finally, we have skin in the game. Wealhouse partners are all personally invested in our funds. At the end of the day, any investment that clients make, they know that we are invested alongside them. Our interests are aligned.”