EUROPEAN funds shone brightly last month, fuelled by surging markets on major old world bourses that have escaped the wrath of Asian currency woes.
The average European fund jumped 4.7 per cent in January, lifting the one-year average return to 27.6 per cent.
The $6.8-million Aim Europa Fund was the biggest gainer last month, rising 8.9 per cent. The $51.2-million Scotia Excelsior European Growth Fund leaped 6.9 per cent while the $17-million Scudder Greater Europe Fund rose 6.8 per cent.
Over the past year, some of the top winners among the actively managed European funds included the $51.2-million AGF European Growth Class, which rose 36.2 per cent, and the $1.5-billion Fidelity European Growth Fund, which jumped 35.4 per cent.
Sally Walden, the London-based manager of Fidelity European Growth, says a current theme in Europe is the growth in mergers and acquisitions activity.
In January, two of the pharmaceutical industry's largest companies, Glaxo Wellcome PLC and SmithKline Beecham, both of Britain, proposed a merger that could form one of the largest companies in the world, worth almost $220-billion (U.S.). And the financial services sector is another industry experiencing consolidation, she said in a recent commentary to brokers.
U.S. equity funds, meanwhile, rose an average of 1.8 per cent last month. Over the past year, the average for this group has been a robust 25.9 per cent.
Both the $3.4-million (Canadian) Industrial Alliance U.S. Stock Fund and the $390-million AGF American Growth Class jumped 8 per cent last month.
Over the past year, the big winners were the $7.9-million Co-operators U.S.Equity Fund, which soared 47.5 per cent, and the $26.6-million O'Donnell U.S. Mid-Cap Fund, which jumped 47.1 per cent.
But it was the Latin American/emerging markets funds that took a beating last month, plummetting an average of 6 per cent. Over the past year, they lost an average of 6.5 per cent.
The $52.3-million Canada Trust Emerging Markets Fund took the biggest hit, plunging 11.1 per cent. Other big losers were the $260.3-million 20/20 Latin American Fund, down 10.4 per cent, and the $159.4-million Investors Latin American Growth Fund, down 9.8 per cent.
The bag of results was mixed for Asian and Pacific funds, which have taken a pasting in recent months because of the currency crisis and stock market meltdowns in the Far East. These funds lost an average of 1.1 per cent in January, bringing the average loss over the past year to 22.3 per cent.
The $5.1-million Clarington Asia Pacific Fund plunged 17.3 per cent and the $7.1-million Navigator Asia Pacific Fund skidded 15.3 per cent. But the $19.3-million Aim Korea Fund gained 35.4 per cent and the $12.3-million InvestNat Japanese Equity Fund rose 14.6 per cent.
Investors who held broadly based international equity funds enjoyed good gains. The average international stock fund climbed 2.6 per cent last month while the average climb over the past year was 14.7 per cent.
Some of the biggest climbers last month included the $14-million Royal Life International Equity Fund, which climbed 6.7 per cent, and the $220-million Universal International Stock Fund, which rose 6.6 per cent.
The top-performing international equity fund over the year was the $54.1-million BPI Global Opportunities Fund, which surged 42.2 per cent.
U.S. and international balanced funds enjoyed an average gain of 2.5 per cent in January. The big movers included the $1.3-million Co-operators U.S. Diversified Fund, which jumped 5.5 per cent, and the $63-million AGF European Asset Allocation Fund and the $161.1-million Universal World Asset Allocation Fund, both up 5.1 per cent.
The average international bond fund jumped an average of 2.1 per cent last month and gained 8.9 per cent over the past year. The top gainers included the $15.4-million National Trust International RSP Bond Fund, up 5.5 per cent, and the $40.1-million Universal World Tactical Bond Fund, up 4.9 per cent.
On the domestic front, Canadian bonds gained an average 1.3 per cent last month and 9.1 per cent over the past year. The top gainers were the $1.5-million Hartford Life Canadian Income Fund, up 4.2 per cent, and the $283-million Altamira Bond Fund, up 2.8 per cent.
But Canadian equity funds had a tough month in January. They lost an average of 0.4 per cent though they are still up an average of 8.8 per cent over the past year.
The big winners were the resource-laden $1.1-billion Industrial Growth Fund and the $10.4-million CDA Canadian Equity Fund (Trimark), both up 4.3 per cent.
The biggest losers last month, however, were the $2.7-million Trans-Canada Value Fund, which plunged 5.7 per cent, and the $123.1-million Altamira North American Recovery Fund, which fell 4.4 per cent.
Canadian small-to-mid cap funds fared worse. They lost an average of 2 per cent last month but have gained a lacklustre 4.2 per cent over the past year.
Bucking the trend in this group last month were the $4.7-million Resolute Growth Fund, which jumped 4.5 per cent, and the $39.4-million Dynamic Small Cap Fund, which climbed 3.8 per cent.
Precious metals/resource funds continued their losing streak, dropping an average of 0.2 per cent last month. Over the past year, the group has plunged an average of 27.4 per cent.
Last month, however, some funds made a comeback. The $27.3-million Dynamic Global Precious Metals Fund gained 7.6 per cent while its sister, the $220.8-million Dynamic Precious Metals Fund, climbed 6.8 per cent. And the $93.1-million Universal Precious Metals Fund jumped 6.6 per cent.
ONE-MONTH FUND ASSET CLASS RETURN AIM Korea Asia & Pacific Rim +35.4% Global Manager - Japan Geared ($U.S.) Asia & Pacific Rim +18.3 Friedberg Currency Sector equity +17.5 Growsafe Japanese 225 Index Asia & Pacific Rim +15.2 InvesNat Japanese Equity Asia & Pacific Rim +14.6 AIM Nippon Asia & Pacific Rim +13.1 Global Manager - Japan Index ($U.S.) Asia & Pacific Rim +12.3 Global Strategy Japan Asia & Pacific Rim +11.9 Green Line Japanese Growth Asia & Pacific Rim +11.2 Altamira Japanese Opportunity Asia & Pacific Rim +10.9 Universal Japan Asia & Pacific Rim +10.6 Global Strategy Dividend Japan Plus Asia & Pacific Rim +10.5 First Cdn. Global Science & Technology Sector equity +10.3 McDonald New Japan Asia & Pacific Rim +10.1 Growsafe U.S. 21st Century Index U.S. equity +10.0
Global Manager - HK Geared ($U.S.) Asia & Pacific Rim -30.1% Clarington Asia Pacific Asia & Pacific Rim -17.8 Navigator Asia Pacific Asia & Pacific Rim -15.3 Cambridge Pacific (Sagit) Asia & Pacific Rim -15.2 Allstar AIG Asian Asia & Pacific Rim -14.1 Global Manager - HK Index ($U.S.) Asia & Pacific Rim -12.6 Green Line Asian Growth Asia & Pacific Rim -12.4 AIM Tiger Asia & Pacific Rim -12.1 Cambridge China (Sagit) Asia & Pacific Rim -11.4 Canada Trust Emerging Markets Latin/emerging markets -11.1 Mutual Alpine Asian Asia & Pacific Rim -11.0 GT Global Natural Resources Class Resources -11.0 20/20 Latin America Latin/emerging markets -10.4 Ethical Pacific Rim Asia & Pacific Rim -10.1 Investors Latin American Growth Latin/emerging markets -9.8
Source: Glorb HySales