David Barr- PenderFund Capital Management Ltd.

Manager keeps cash on hand to seize small cap opportunities.

Michael Ryval 2 May, 2014 | 6:00PM
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Since the pricing of stocks in the small-cap segment is relatively inefficient, David Barr makes no apologies for a 22% cash weighting in the $78-million Pender Small Cap Opportunities A.

"It's a huge advantage to have the capital available to deploy when a stock gets temporarily mispriced," says Barr, chief investment officer at Vancouver-based PenderFund Capital Management Ltd.

Noting that the fund typically has about 20% cash on hand, Barr adds: "A lot of times a company will release a poor quarter, or miss on its revenue. But we think the business case is still intact. When we have a buying opportunity we have the cash on hand to buy companies we like, at prices that we think are great."

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Michael Ryval

Michael Ryval  Michael Ryval, a regular contributor to Morningstar, is a Toronto-based freelance writer who specializes in business and investing.

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