WHAT ARE WE LOOKING FOR?
Top-performing, labour-sponsored investment funds over the long haul. These investments - now called retail venture funds - were marketed on their long-term potential and juicy tax credits.
We looked at their performance over the decade to the end of 2007 - specifically, average annual returns over one, three, five and 10 years.
SO WHAT DID WE TURN UP?
Ugly returns. Dead funds. Funds reinventing themselves. Many took a hit after the technology bubble burst. And high management fees have taken a big bite from returns.
GrowthWorks Canadian, formerly Working Ventures Canadian Fund, posted an average annual loss of 3 per cent over the decade.
Canadian Medical Discoveries (series I), formed from the merger of the first two original series, fared even worse. It suffered an average annual loss of 6.6 per cent. And VenGrowth Investment Fund Class A (series E) declined an average of 1.1 per cent a year.
Some funds managed to stay in the black. At the lower end was BEST Discoveries, up 1 per cent annually. Dynamic Venture Opportunity (series I) posted a 6.8-per-cent average annual return - the best in the group. Still, they underperformed the 9.8-per-cent average for Canadian small-to-mid-capitalization equity funds.
While Crocus Investment Fund is listed as active, it's on life support. The scandal-ridden fund has been mired in legal woes, and its assets are still being liquidated.
Sportfund merged with Retrocom Growth Fund, which filed for bankruptcy protection in 2006 and proceedings are continuing. And Covington Fund I was wound down last year.
Out of 20 funds, 13 are listed as non-active. Some of them are under new managers, or have merged with other funds.
Triax Growth I merged with the Covington Venture Fund Inc. (series I). York Labour Fund, formerly Centerfire Growth, has become Lawrence Enterprise V Fund.
Impax Venture Income Fund, formerly DGC Entertainment Ventures, merged with Impax Venture Fund to become Horizons Advantaged Equity Fund (series I).
Capital Alliance Ventures, Canadian Science &Technology Growth and First Ontario (which took over Trillium Growth Capital and FESA Enterprise Venture Capital) merged with GrowthWorks Canadian to start a new series. Ensis Growth will soon amalgamate with GrowthWorks Canadian too. Workers Investment Fund has merged with GrowthWorks Atlantic Venture Fund.
When funds start a new life, the performance clock often starts all over again. So much for long-term potential.
Labour-sponsored funds existing in 1998
|Net assets||% return as of Dec. 2007|
|Fund name||date||as of Dec. '07||1-year||3-year||5-year||10-year||inception||fund as of today||effective||reported|
|Working Opportunity Balncd Ser 1||4/1/1992||154.9||-2.84%||-2.48%||-1.90%||1.62%||2.66%||Active||9/30/2005||2.63|
|Crocus Investment Fund||3/1/1993||Active||1/30/2004||4.04|
|Dynamic Venture Opport Series I||2/28/1994||61.9||-6.52%||5.78%||5.22%||6.79%||1.78%||Active||6/29/2007||3.99|
|Impax Venture Income Fund Inc.||3/1/1994||Not Active|
|Canadian Medical Discoveries Ser I||10/7/1994||156.4||-19.84%||-13.93%||-9.93%||-6.60%||-4.32%||Active||5/31/2005||3.71|
|Trillium Growth Capital Inc.||10/25/1994||Not Active|
|Canadian Medical Discoveries||12/7/1994||Not Active|
|First Ontario LSIF Ltd.||1/31/1995||Not Active|
|Covington Fund I||2/28/1995||Not Active|
|Capital Alliance Ventures||2/28/1995||Not Active|
|FESA Enterprise Venture Capital||3/1/1995||Not Active|
|VenGrowth Invst Fund Inc. Cl A SrE||3/1/1995||95.7||-9.57%||-2.70%||-4.35%||-1.12%||0.58%||Active||8/31/2007||4.17|
|Retrocom Growth||4/13/1995||Not Active|
|Triax Growth-I||1/10/1996||Not Active|
|Canadian Science & Tech Growth||12/2/1996||Not Active|
|B.E.S.T. Discoveries I||12/31/1996||56.9||20.32%||6.59%||1.38%||0.97%||0.70%||Active||9/28/2007||5.72|
|Workers Investment Fund Inc.||1/10/1997||Not Active|
|York Labour Fund Inc||3/1/1997||Not Active|
|ENSIS Growth Fund Inc.||1/5/1998||96.0||2.15%||-3.13%||-2.13%||-2.10%||Active||10/29/2004||4.95|
|Avg Return - Canadian Small-Mid Cap Equity Fund||7.23%||12.46%||16.95%||9.78%|
|Median Return - Canadian Small -Mid Cap Equity Fund||8.02%||11.61%||16.24%||10.47%|
|BMO Nesbitt Burns Cdn Small Cap Index||2.01%||12.51%||18.33%||9.68%|
Note: The list does not include the Quebec Solidarity Fund because it is valued semi-annually and data is incomplete.
© 2007 The Globe and Mail. All rights reserved.
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