|Highest energy exposure||Effective||As of July 31 '08|
|As of July 2008||date of||% Energy||1-month||3-yr|
|Fund name||Category Assets ($-mil)||portfolio||weighting||% return||Quartile|
|Investors Income Trust Fund-C||Cdn. Income Trust Equity||282.4||5/30/2008||54.8||-6.50||1|
|Acuity Income Trust||Cdn. Income Trust Equity||179.6||8/29/2008||50.3||-6.25||2|
|Norrep Income Growth Class-A||Cdn. Income Trust Equity||29.7||7/31/2008||48.1||-7.24|
|IA Clarington Tactical Income-T8||Cdn. Income Trust Equity||50.4||6/30/2008||47.4||-7.56||3|
|Sprott Growth||Cdn. Focused Small/Mid Cap Eq||288.6||7/31/2008||47.0||-14.09|
|Montrusco Bolton Equity Income||Cdn. Income Trust Equity||153.6||6/30/2008||46.9||-4.81||4|
|Caldwell Canada||Cdn. Small or Mid Cap Equity||6.6||6/30/2008||46.7||-12.19||1|
|Dynamic Power Cdn Growth||Cdn. Focused Equity||1,822.7||5/30/2008||45.8||-11.92||1|
|Altafund Investment Corp.||Cdn. Equity||72.5||7/31/2008||45.3||-10.00||1|
|Lakeview Disp Leadership Hi Inc A||Cdn. Small or Mid Cap Equity||167.4||7/31/2008||44.9||-5.41||3|
|Fidelity Income Trust-A||Cdn. Income Trust Equity||47.4||6/30/2008||42.8||-5.51||1|
|Renaissance Diversified Income||Cdn. Income Trust Equity||229.4||7/31/2008||42.4||-6.58||4|
|Bissett Income-F||Cdn. Income Trust Equity||47.7||6/30/2008||41.8||-5.24||3|
|Dynamic Power Cdn Growth Class||Cdn. Focused Equity||146.0||5/30/2008||41.6||-11.92||1|
|DMP Power Canadian Growth Class||Cdn. Focused Equity||18.6||5/30/2008||41.2||-12.06||1|
|Middlefield Enhanced Yield||Cdn. Income Trust Equity||1.6||7/31/2008||40.7||-4.09||3|
|JOV Canadian Equity Class||Cdn. Equity||8.2||7/31/2008||40.1||-12.92|
|Sprott Small Cap Equity-A||Cdn. Small or Mid Cap Equity||7/31/2008||40.0||-8.67|
|GGOF Monthly High Income Classic||Cdn. Income Trust Equity||96.3||7/31/2008||39.8||-5.86||3|
|Marquis Enhanced Canadian Equ Pl-C||Cdn. Equity||53.9||5/30/2008||39.2||-7.05||2|
|BMO Income Trust||Cdn. Income Trust Equity||29.5||4/30/2008||39.2||-5.81|
|Renaissance Cdn Monthly Income||Cdn. Income Trust Equity||397.1||7/31/2008||39.2||-6.34||3|
|AGF Canadian All Cap Equity||Cdn. Equity||9.0||7/31/2008||39.1||-9.54|
|Bissett Small Cap-F||Cdn. Small or Mid Cap Equity||52.6||6/30/2008||38.8||-8.98||4|
|Dynamic FocusPls Diversifd Income||Cdn. Income Trust Equity||1,350.8||5/30/2008||38.4||-5.45||3|
|Norrep Q Class-A||Cdn. Equity||84.0||7/31/2008||37.9||-10.68||3|
|IA Clarington Cdn Conservative Eqty||Cdn. Equity||270.7||6/30/2008||37.6||-4.89||3|
|Renaissance Millennium High Income||Cdn. Small or Mid Cap Equity||964.2||7/31/2008||37.3||-4.07||3|
|JOV Talisman-A||Cdn. Focused Equity||18.1||7/31/2008||36.7||-9.34||4|
|iShares CDN Value Index||Cdn. Dividend and Income Equity||27.8||7/31/2008||36.4||-3.95|
|IA Clarington Canadian Growth||Cdn. Equity||46.7||6/30/2008||36.3||-6.62||3|
|iShares CDN SmallCap Index||Cdn. Small or Mid Cap Equity||27.5||7/31/2008||35.9||-7.84|
|Saxon High Income Fund||Cdn. Income Trust Equity||154.3||7/31/2008||35.6||-5.72||2|
|TD Cdn Small-Cap Equity||Cdn. Small or Mid Cap Equity||437.1||7/31/2008||35.5||-6.72||4|
|IG AGF Cdn Diversified Growth-C||Cdn. Small or Mid Cap Equity||231.9||5/30/2008||35.5||-10.03||2|
|Acuity Growth and Income||Cdn. Dividend and Income Equity||340.2||8/29/2008||35.4||-7.65||2|
|Mackenzie Sentinel Income Trust-A||Cdn. Income Trust Equity||28.6||7/31/2008||34.9||-5.75|
WHAT WE'RE UP TO
Notice how falling oil prices torpedoed the Canadian stock market this week? It was a slick move for an equity fund manager to have loaded up on oil and gas stocks over the past couple of years, but energy right now is a big drag on performance. Let's see which funds have the most exposure to this sector.
Funds in all the various Canadian equity and balanced categories were ranked according to the percentage of their holdings in the energy sector. To get a sense of how a fund's energy exposure has played out both in the short and long term, check out the one-month returns and the three-year quartile ranking. Quartiles divide funds in a category into four groups based on returns. First quartile is tops, fourth is the basement.
SO WHAT DID WE TURN UP?
A lot of funds with one-third to half of their assets in the energy sector as of their most recent portfolio disclosure to Globefund.com. Suggestion: If you own Canadian equity or balanced funds of any type, take a moment to monitor their energy weightings. For better and for worse, energy stocks have been a major market driver for a long time now and it's important to know your level of exposure.
The funds on our list have sustained varying levels of damage as a result of their energy exposure in the month to July 31, but the common thread is that each one is down significantly. More aggressive funds have taken the worst hits, but income-oriented funds in the Canadian income trust category have been hit as well.
It turns out that energy dominates the income trust sector even more than it does the broader S&P/TSX composite. Energy accounted for almost two-thirds of the benchmark S&P/TSX capped income trust index at mid-year, compared with about one-third for the composite.
While you're looking at the energy weighting in the funds you own, check the returns you've had over the past three to five years to see how they match up against other funds in the same category. If you've done well, say first or second quartile, then any recent losses should be more tolerable. Combine heavy energy exposure, poor medium-term results and sharp losses recently and you have a fund with real problems.
© 2007 The Globe and Mail. All rights reserved.
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