Canadian small-cap managers don't come any better than Martin Ferguson of Mawer Investment Management Ltd., who will be retiring from the Calgary-based firm effective Dec. 31.
Ferguson, who is in his mid-50s, is best known as manager of the $1.2-billion Mawer New Canada, for which he has been responsible since December 1996. He has also managed the $328-million BMO Enterprise since August 2004. Both funds have a 5-star Morningstar Rating, and they're the only two funds in the Canadian Small/Mid Cap Equity category that currently have a gold rating from Morningstar's manager-research team. With Ferguson's pending departure, the gold ratings are now under review.
Ferguson's industry awards include being a two-time winner of Morningstar's Domestic Equity Fund Manager of the Year. He won individually in 2011, and again in 2014 when he and co-manager Jeff Mo were honoured as a team.
In a June 24 statement, Mawer confirmed a three-month transition period. Effective Oct. 1, Mo will take over from Ferguson as lead manager of Mawer New Canada and the firm's other Canadian small-cap mandates.
Mo has worked closely with Ferguson since joining the firm in 2008 and has been the co-manager of the small-cap strategy since July 2012, Mawer said in its release, adding that Mo will be supported by Mawer's entire research team of more than 20 portfolio managers and analysts. "The consistency of Mawer's investment approach across all asset classes, depth of the research team, and continuity with Jeff Mo will enable a seamless transition," the company said.
Contributing to Mawer's excellence in small-cap investing has been its decision to cap its small-cap funds rather than risk diluting performance. Mawer's small-cap strategy relies on selecting about 50 companies believed to be trading at attractive discounts to their intrinsic value, based on analysis of their ability to generate cash flows. Mawer New Canada has been capped since January 2005, and BMO Enterprise was capped in March 2013.
Before joining Mawer in 1996, Ferguson was with the investment-management division of Alberta Treasury. At the time of his departure in 1996 from this Alberta government department, he was senior manager of equity research.
Ferguson had first joined Alberta Treasury in 1982, as a junior analyst, and then left in 1985 to become an analyst at Principal Securities Management Ltd. He rejoined Alberta Treasury in 1987. Ferguson earned a bachelor of commerce degree, majoring in finance, from the University of Alberta in 1982, and has been a CFA charterholder since 1985.