Business Context and Reporting Period
Reporting Manager: The Toronto-Dominion Bank (TD Bank)
Filing Type: Form 13F-HR (Combination Report)
Reporting Period: Quarter Ended September 30, 2009
Submission Date: November 12, 2009
Scope: This report covers a portion of the manager's holdings, with other portions reported by affiliated managers including TD Asset Management USA Inc., TD Asset Management Inc., TD Securities (USA) LLC, TD Options, LLC, TD Securities, Inc., and TD Global Finance.
Key Financial Metrics
Total Portfolio Value: $18,553,234,000 (Reported as $18,553,234 in thousands)
Total Holdings Count: 1,040 entries
Asset Classes: Common Stock, Preferred Stock, Call Options, Put Options, and Exchange-Traded Funds (ETFs).
Geographic Focus: Significant exposure to Canadian equities (Banking, Energy, Mining) and U.S. equities (Technology, Financials, Healthcare).
Top Holdings by Share Count (Selected)
- Royal Bank of Canada: 51,554,237 shares (Sole Discretion)
- Bank of Nova Scotia: 43,757,305 shares (Sole Discretion)
- Bank of Montreal: 21,814,872 shares (Sole Discretion)
- Research In Motion: 12,705,825 shares (Shared Discretion)
- Manulife Financial Corp: 26,244,551 shares (Sole Discretion)
- TransCanada Corp: 15,988,397 shares (Sole Discretion)
- Shaw Communications Inc: 9,164,550 shares (Sole Discretion)
- Encana Corp: 8,446,931 shares (Sole Discretion)
- Goldcorp Inc: 7,431,391 shares (Sole Discretion)
- Yamana Gold Inc: 6,389,672 shares (Sole Discretion)
Material Changes and Portfolio Composition
Derivatives Activity: The portfolio contains significant positions in options (Calls and Puts) on major holdings, particularly in the Canadian energy and mining sectors (e.g., Barrick Gold, Potash Corp, Teck Cominco, TransAlta). This suggests active hedging or leverage strategies rather than passive long-only investing.
Sector Concentration:
- Financials: Heavy concentration in major Canadian banks (TD, RBC, BMO, BNS, CIBC) and U.S. financials (JPMorgan Chase, Bank of America, Citigroup).
- Energy & Materials: Substantial holdings in Canadian energy (Encana, Nexen, Suncor, Talisman) and mining (Goldcorp, Barrick, Kinross, Agnico-Eagle).
- Technology: Notable positions in Research In Motion, Microsoft, Cisco, and Apple.
Guidance, Outlook, and Risks
Management Commentary: Form 13F filings are statutory disclosures of holdings and do not contain management commentary, earnings guidance, or forward-looking outlooks.
Risks and Contingencies:
- Concentration Risk: The portfolio is heavily weighted toward the Canadian financial and resource sectors, exposing it to commodity price volatility and domestic economic conditions.
- Derivative Risk: The presence of significant Put and Call option positions introduces leverage and timing risks.
- Shared Discretion: A portion of the holdings is reported under "Shared" discretion, indicating complex co-management arrangements that may affect voting rights and trade execution.
Investor Verification Checklist
- Verify the total aggregate value of the portfolio across all affiliated managers (TD Asset Management, TD Securities, etc.) to understand the full scale of TD Bank's investment arm.
- Confirm the specific strike prices and expiration dates of the reported Call and Put options to assess the net exposure (hedged vs. speculative) on major positions like Barrick Gold and TransCanada.
- Review the "Shared Discretion" entries to determine the extent of control TD Bank retains over voting rights for these specific holdings.
- Compare the September 30, 2009 holdings against the June 30, 2009 13F filing to identify net buying or selling trends in the financial and energy sectors during the third quarter.