Hamblin Watsa Investment Council Ltd.(HWIC)
Investment Performance
Fairfax's internal money management firm, Hamblin Watsa, earned 19.9% compounded returns annually, on its stock investments (includes Equity Hedging) between 2000 and 2009. The investment team is led by Brian Bradstreet, Roger Lace, Sam Mitchell and Chandran Ratnaswami. The fixed income/CDS portfolio managers team has only two members, Brian Bradstreet and Enza LaSelva.
The following table shows the time-weighted performance of HWIC vs S&P 500 Index and the BofA Merrill Lynch U.S. Corporate Bond Index.
| 5 Years to Dec. 31, 2009 | 10 Years to Dec. 31, 2009 | 15 Years to Dec. 31, 2009 | |
|---|---|---|---|
| Common Stocks (HWIC) with Equity Hedging | 17.1% | 19.9% | 18.3% |
| Common Stocks (HWIC) | 5.9% | 13.9% | 14.3% |
| S&P 500 | 0.4% | (-1.0%) | 8.0% |
| Bonds (HWIC) | 11.8% | 12.1% | 10.6% |
| BofA Merrill Lynch U.S. Corporate Bond Index | 4.5% | 6.4% | 6.8% |
Source:- The 2010 Fairfax Annual Meeting Slide Presentation - PDF page 23 of 41
At December 31, 2008, Fairfax's investment portfolio of $18.4 billion consisted of approximately 46% ($8.4 billion) of bonds, approximately 30% ($5.5 billion) of cash and short term investments and approximately 21% ($3.8 billion) of common stocks. Included in the bond portfolio are $4.0 billion of tax-exempt bonds approximately 87% of which are insured by Berkshire Hathaway Assurance Corp.
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