Tetrem founder closing up shop

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This article was published 24/05/2017 (2521 days ago), so information in it may no longer be current.

Danny Bubis, the founder, president and chief investment officer of Tetrem Capital Management, is winding down his 13-year-old investment counsel and portfolio management firm.

He’s not selling it and the decision to close up shop is entirely his own and is not being made because of pressure from creditors or clients.

The 12-person Winnipeg firm manages about $4.5 billion in assets, mostly for CI Investments Inc. mutual funds, but also for a number of high net worth individuals.

Bubis, 50, said the decision is his alone and is being made for a “mosaic” of reasons.

“We are at a high water mark for all our clients. This is not a market call,” Bubis said.

“But we have been in a world where it is getting more difficult to find value in the marketplace and we are a value manager.”

But mostly Bubis is walking away to take a break and because he can do it on his terms.

“This is a 365 day per year job,” he said. “I’m looking forward to being able to see what it is like to wake up in the morning and not be responsible for people’s life savings.”

He said he has no plans other than to “be present and not distracted with my family and friends.”

Bubis was the former chief investment officer of Assante, which was acquired by CI Investments in 2003. He started Tetrem in 2004 and the relationship with CI has been a constant feature of the growth of the firm.

“They have been a fantastic business partner,” he said.

“I have nothing but the highest level of respect for everyone in that organization.”

Neal Kerr, executive vice-president investment management for CI Investments, said it’s confident in new management that was announced on Wednesday, but said, “We will miss our relationship with Tetrem. Throughout various market environments, Tetrem has been consistent and disciplined in applying its approach and conducting independent research.”

Staff at Tetrem will be looked after and some have already found other work in town.

Evan Mancer, president and chief investment officer of Cardinal Capital Management, now the largest independent investment counsel and portfolio manager in Winnipeg said, “On the one hand you don’t want more and more competition, but on the other hand we are all small fish in the big Canadian pond and it’s good to have other good firms in the business in the province.”

He said, “The way I feel about Danny, is that way many others do, that he has a great reputation as a great money manager.”

In fact, he may be one of the best.

While Bubis was helping to build Assante into a Winnipeg powerhouse, Charlie Spiring was doing the same with his former brokerage firm, Wellington West. (Spiring has just launched a new firm called Wellington-Altus Private Wealth Inc.)

Spiring said, “Danny is one of the best money managers Winnipeg has ever produced and I’m very comfortable saying that. He’s winding down the firm with elegance and style the way you would hope.”

But as successful as Tetrem has been, according to one industry veteran, the firm’s value on the market was completely tied up in the presence of Bubis at the helm. Therefore, it was not an enterprise that could have been sold and operated by anyone else.

“It’s probably true that I was not very successful at institutionalizing the business,” Bubis said. “I don’t know if I really tried to do it. I think I could have monetized more of it… It was not necessarily the most commercial decision not to do that.”

In its latest quarterly report to Tetrem’s investors, it showed annualized returns to March 31, 2017, of 18.9 per cent.

“Last year, we had a great year,” Bubis said.

“Everyone who has ever invested with me… all my clients… made money with me. I’m proud to be able to say that.”

martin.cash@freepress.mb.ca