What We're Looking For
Small, possibly overlooked mutual funds that have excellent long-term records, but haven't done so well lately.
Funds on our list have 10-year compound average annual returns that rank in the first quartile.
Quartiles divide funds in a category into four groups according to their returns, and the first quartile is at the top.
Lately, though, these funds have lagged enough to have landed in the third or fourth quartile for the 12 months to July 31.
We focus on the smallest of funds in today's list, whereas yesterday we looked at big funds that have done well in the long term.
What We Found
We turned up some worthy funds, such as Leith Wheeler Canadian Equity, which has a terrific 15-year compound average annual return of 9.6 per cent, compared with 7 per cent for the average Canadian equity fund, and 8.7 per cent for the S&P/TSX composite total return index (including dividends).
Lately, though, this fund has fallen a little below average. Note: You need a minimum $25,000 to buy into this low-fee fund, and it's not available in Quebec or Atlantic Canada.
Leith Wheeler Canadian Equity can be classified as a core investment for a portfolio.
Front Street Growth, in contrast, is the sort of fund that can be considered a much riskier complement.
Its 10-year numbers are outstanding - almost triple its peer average - but last year it plunged just over 50 per cent. Recent data suggest the slump is over.
Another fund focusing on small- and medium-sized stocks is Northwest Special Equity, which was hit reasonably hard last year but has made 11 per cent annually, on average, for the past 15 years.
The Norrep Fund looks like a similar proposition, but unfortunately it's closed to new investment.
|Fallen Stars - Part 2 (ranked by lowest assets)|
|(As of July 31/09)||Latest||% returns (as of July 31)|
|Fund name||Category Assets ($-mil)||MER||1-yr||10-yr|
|Tradex Global Equity||Global Equity||6.8||2.23||-18.6||0.5|
|BMO GDN Monthly Dividend Fd Classic||Canadian Neutral Balanced||25.9||1.53||-8.0||5.8|
|Fidelity Latin America-A||Miscellaneous||32.4||2.65||-23.2||10.1|
|SEI Balanced 60/40-O||Global Neutral Balanced||36.2||0.27||-9.7||5.3|
|Integra Short Term Investment||Canadian Money Market||56.9||0.95||0.5||3.0|
|Norrep Fund||Canadian Small or Mid Cap Equity||75.9||2.49||-25.9||16.0|
|CIBC International Small Companies||International Equity||80.7||2.76||-25.7||2.6|
|SEI U.S. Large Cap Synthetic-O||U.S. Equity||86.3||0.16||-24.0||-2.5|
|GBC International Growth||International Equity||88.7||2.14||-23.7||0.1|
|Front Street Growth-B||Canadian Small or Mid Cap Equity||89.2||2.73||-28.8||16.3|
|TD U.S. Index Currency Neutral-I||U.S. Equity||89.6||0.84||-24.7||-3.0|
|Altamira US Currency Neutral Index||U.S. Equity||92.3||0.57||-25.0||-3.0|
|Montrusco Bolton Quantitative Cd Eq||Canadian Equity||98.6||1.21||-31.9||11.4|
|Dynamic Strategic Growth Portfolio||Global Neutral Balanced||131.1||2.49||-9.4||4.5|
|Leith Wheeler Canadian Equity B||Canadian Equity||141.5||1.50||-19.2||8.4|
|Altamira Dividend||Canadian Neutral Balanced||154.4||1.76||-8.6||5.6|
|TD Latin American Growth||Miscellaneous||182.1||2.73||-25.2||11.7|
|Northwest Specialty Equity||Canadian Small or Mid Cap Equity||187.1||2.57||-23.2||9.8|
|CI Synergy Tactical AA||Tactical Balanced||198.1||2.20||-7.5||4.7|
|RBC U.S. Index Currency Neutral||U.S. Equity||208.9||0.69||-25.8||-3.2|
|FÉRIQUE Bond||Canadian Fixed Income||212.1||0.64||4.8||5.7|
|Dynamic Power American Growth||U.S. Equity||265.8||5.10||-39.5||-2.1|
|Fidelity Europe-B||European Equity||267.0||2.33||-29.5||-1.1|
|Sceptre Equity Growth-A||Canadian Small or Mid Cap Equity||297.0||1.58||-34.4||10.9|
|Highstreet Balanced||Canadian Fixed Income Balanced||319.2||1.25||-9.5||5.4|
|Fidelity Cdn Disciplined Equity-A||Canadian Equity||485.3||2.40||-19.4||8.7|
|Manulife Growth Opportunities Fund||Canadian Small or Mid Cap Equity||501.0||2.61||-23.3||11.3|
|BMO U.S. Equity||U.S. Equity||507.6||2.39||-19.9||-2.9|
|Renaissance Millennium High Income||Canadian Dividend and Income Equity||524.8||2.36||-22.7||8.9|
|Source: Globe Investor|
© 2007 The Globe and Mail. All rights reserved.
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