What are we looking for?
Let's put the country's most popular mutual funds in our crosshairs today - do they deserve the trust of the investors who have given them billions of dollars?
We'll start with a list of the largest mutual funds as measured by asset levels at July 30. We'll then thin the ranks by eliminating all funds without a 10-year track record. To determine whether a fund is doing the job or not, we listed its 10-year average annual return and the quartile ranking of this return. A fund with a 10-year return in the top 25 per cent for its category would be first quartile, and a fund in the bottom 25 per cent would be fourth quartile. All other funds would be either second or third quartile, which means above or below the midpoint.
So what did we turn up?
A clear pattern of big funds doing right by the investors who own them and the investment advisers who sell them. All but one of the 10 most widely held funds had first-quartile returns over the past decade, and only a single fund on the entire list was in the cellar-dwelling fourth quartile. Mackenzie Ivy Canadian, come on down.
This fund has been a chronic underperformer for about five years now, although it does offer a very low level of volatility. RBC Balanced is another notable underachiever on our list, but if you check its more recent numbers you'll see it regularly delivering above-average returns. And then there's Templeton Growth, at one time the largest mutual fund in Canada by far and now just another face in the crowd. Blame years of below-average returns for the fact that assets in this fund are less than half of what they were seven years ago.
BIGGEST 25 FUNDS
Ordered by largest assets. Returns to July 31. All Segregated, $U.S. and Money Market Funds are excluded.
|Fund name||Asset class||Net assets||MER||10yr. return||10yr. Quartile ranking|
|Investors Dividend||Canadian Equity Balanced||13,617,206.00||2.96||7.74%||1|
|TD Canadian Bond||Canadian Fixed Income||8,950,494.00||1.07||5.90%||1|
|RBC Canadian Dividend||Canadian Dividend and Income Equity||8,897,704.00||1.73||12.00%||1|
|RBC Balanced||Canadian Neutral Balanced||8,726,971.00||2.28||5.90%||3|
|Mackenzie Cundill Value||Global Equity||7,193,736.00||2||9.50%||1|
|CI Canadian Investment||Canadian Focused Equity||6,561,222.00||2.3||11.10%||1|
|BMO Dividend||Canadian Dividend and Income Equity||5,921,452.00||1.73||12.80%||1|
|Trimark Select Growth||Global Equity||5,775,693.00||2.35||6.10%||1|
|CI Harbour Growth & Income||Canadian Neutral Balanced||5,414,184.00||2.35||7.70%||1|
|CI Harbour||Canadian Focused Equity||4,929,105.00||2.35||10.70%||1|
|Templeton Growth Fund Ltd.||Global Equity||4,797,240.00||2.34||3.70%||3|
|RBC Cdn Equity||Canadian Equity||4,795,375.00||1.99||9.50%||2|
|RBC Select Balanced||Global Equity Balanced||4,378,794.00||1.68||5.50%||2|
|CI Signature High Income||Canadian Equity Balanced||4,324,279.00||1.55||11.00%||1|
|MD Growth||Global Equity||4,041,560.00||1.44||4.70%||2|
|RBC Bond||Canadian Fixed Income||3,814,820.00||1.46||4.10%||3|
|Mackenzie Ivy Canadian||Canadian Focused Equity||3,743,316.00||2.4||5.70%||4|
|Trimark Fund||Global Equity||3,741,686.00||1.61||7.60%||1|
|AGF International Value||Global Equity||3,402,615.00||2.8||6.80%||1|
|Trimark Select Canadian Growth||Canadian Focused Equity||3,398,501.00||2.32||7.20%||3|
|AGF Canadian Large Cap Div-Classic||Canadian Focused Equity||3,384,059.00||1.84||8.50%||2|
|RBC Select Conservative||Global Neutral Balanced||3,342,850.00||1.65||5.50%||2|
|PH&N Dividend Income-A||Canadian Focused Equity||3,279,150.00||1.14||13.30%||1|
|TD Canadian Equity||Canadian Equity||3,053,929.00||2.11||10.70%||1|
|Mackenzie Ivy Growth & Income||Canadian Equity Balanced||3,039,460.00||2.14||6.00%||2|
|TD Dividend Income||Canadian Equity Balanced||3,008,313.00||1.96||10.10%||1|
|Mackenzie Ivy Foreign Equity||Global Equity||2,731,373.00||2.46||5.90%||2|
© 2007 The Globe and Mail. All rights reserved.
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