Executive interview – Canadian General Investments

Published on 22 May 2019

Canadian General Investments (LSE:CGI and TSE:CGI) was launched in 1930 and is North America’s second-oldest closed-end fund. Since 1956, it has been managed by Morgan Meighen & Associates. Portfolio manager Greg Eckel invests with a medium- to long-term outlook in a broad selection of primarily Canadian equities, aiming to outperform the total return of the benchmark S&P/TSX Composite Index. CGI has a favourable tax status, but to maintain this, the company is unable to repurchase its shares to help manage the share price discount to net asset value. CGI has followed a levered strategy since 1998 and more than 50% of its shares are held by related parties.

In this webcast, Morgan Meighen’s executive vice president and chief operating officer Jonathan Morgan highlights CGI’s investment approach and the drivers of its recent and long-term outperformance versus the benchmark. He then focuses on the company’s dividend policy. Morgan follows up by giving a brief summary of the current economic backdrop in Canada. He then focuses on two sectors, disagreeing with the suggestion that Canadian bank shares should be sold and highlighting recent developments in the Canadian energy sector.

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