By Scott Ronalds

Blogger Canadian Capitalist published a complimentary posting on Steadyhand the other day. He highlighted four aspects of our firm that we emphasize on our website and in our conversations with investors:

• Low cost
• Concentration
• Co-investment
• Low turnover
  

On this last attribute (low turnover), he rightly points out that turnover in our Global Equity Fund and Income Fund were remarkably high last year. The Global Fund’s audited turnover rate in 2008 was 179%. A note of clarification is necessary, however. This figure is misleading, as it includes cash management transactions that were made in a money market product held in the fund. Put simply, every time the manager redeems money from this short-term instrument, it impacts the turnover of the fund. When these transactions are excluded from the calculation, turnover was a much lower 35%.

As for the Income Fund, we expect turnover to be much higher than in our equity funds, as the manager pursues a number of strategies within the fund and bond managers constantly ‘fine tune’ their portfolios when implementing interest rate anticipation, duration, and other strategies.

Canadian Capitalist and others like him are doing a good job of educating investors on some of the industry’s flaws and dirty secrets while also providing useful tips and advice. His blog is worth a visit if you haven’t already seen it.