What We're Looking At
This is the final instalment of our week-long look at how the mutual funds that were massacred last year have done in 2009. Today, it's global, international and U.S. equity funds.
Funds in the three categories with assets of $20-million or more were ranked according to the size of their losses in 2008. To see how each fund has rebounded, we've displayed the return for the year through Nov. 26. For a longer-term view on the performance of these funds, we have included five-year quartile numbers. Quartiles divide funds in a category into four groups - first quartile is best, fourth is worst.
What We Found
Shockingly bad 2008 numbers here. I'm among the many who have urged investors to invest globally, and I have to say the results have been terrible. Mea culpa. If you've been reading this series all week, you'll know that we have looked at Canadian equity, balanced and dividend funds. None of these categories had more big losers in 2008, and none have been more inconsistent this year.
On one hand, we have dramatic rebounds from the likes of Dynamic Global Value, up by virtually the same amount this year as it lost last year. That's a great turnaround, but it has to be noted that $100 invested in this fund at the start of 2008 was still worth only $81 as of late last month.
And there's Desjardins American Equity Growth, AGF Aggressive Global Stock and Dynamic Power American Growth, which have captured very little of the sweeping stock market gains of 2009.
One explanation for a lame performance by a U.S. or global equity fund this year is the rise in the Canadian dollar against its U.S. counterpart. Are your funds using currency hedging to eliminate the impact of the dollar's moves? If not, you're getting extra grief in today's markets. Here's an example: Dynamic Power American Growth is up 5.6 per cent this year, while a currency-neutral version of this fund is up 16.7 per cent.
By the way, global exposure hasn't worked out at all for investors, but you still need some. The year will come when the returns of global funds crush Canadian equity funds. I hope I live to see it (I'm 47).
|Global, International & US Equity Funds as of Nov. 26, 2009|
|Assets ($-mil)||Latest||% rtn||% rtn||Quartile|
|Fund name (as of Oct. 31)||MER||2008||Nov. 26||Oct. 31||Category|
|Dynamic Power Amer Currency Neutral||22.8||2.86||-57.2||16.7||U.S. Equity|
|Acker Finley Select US Value 50-A||26.9||1.80||-54.5||39.4||4||U.S. Equity|
|Dynamic Power Global Growth Cl||336.0||2.48||-47.2||22.4||1||Global Equity|
|DMP Power Global Growth Class||0.0||2.75||-47.1||21.5||Global Equity|
|CI Value Trust Corporate Class||287.9||2.58||-46.6||16.9||4||U.S. Equity|
|Desjardins American Equity Growth||266.9||2.55||-46.6||7.4||4||U.S. Equity|
|Brandes U.S. Equity||41.8||2.57||-46.0||15.6||4||U.S. Equity|
|Mutual Beacon||112.4||2.56||-44.8||20.3||4||Global Equity|
|Dynamic Power American Growth||284.8||2.41||-44.1||5.6||1||U.S. Equity|
|RBC O'Shaughnessy U.S. Value||771.8||1.47||-44.0||21.2||3||U.S. Equity|
|Dynamic Global Value Fund||680.8||2.45||-43.8||44.4||1||Global Equity|
|Manulife Global Value Class||38.7||2.81||-43.2||12.8||4||Global Equity|
|TD NASDAQ Index-I||66.8||0.96||-43.2||41.4||1||U.S. Equity|
|Manulife Global Opportunities Class||79.8||2.70||-43.1||57.7||Global Equity|
|AGF Aggressive Global Stock||47.9||3.10||-43.1||15.1||1||Global Equity|
|Claymore US Fundamental Index ETF||67.3||0.62||-42.6||29.5||U.S. Equity|
|TD International Index Curr Neut-I||61.3||0.96||-42.5||12.6||2||International Equity|
|TD Global Multi-Cap-I||350.9||2.52||-42.4||17.8||Global Equity|
|PH&N Currency-Hedged Oversea Equ-D||48.7||1.58||-42.3||31.2||International Equity|
|RBC U.S. Equity Currency Neutral||56.6||2.01||-42.1||15.4||U.S. Equity|
|AIC Value||81.8||2.60||-42.0||10.5||4||U.S. Equity|
|Investors Int'l Small Cap Class-A||91.0||2.77||-42.0||39.8||1||International Equity|
|Altamira Intl Currency Neutral Idx||76.8||0.57||-41.9||15.8||2||International Equity|
|GBC International Growth||98.9||2.14||-41.7||33.8||1||International Equity|
|IA Clarington Global Dividend-T6||98.7||2.70||-40.8||10.8||Global Equity|
|CI Harbour Foreign Eq Corp Class||536.2||2.35||-40.8||32.9||3||Global Equity|
|iShares CDN MSCI EAFE Index||939.3||0.15||-40.6||16.3||3||International Equity|
|RBC U.S. Index Currency Neutral||218.1||0.69||-40.5||19.5||2||U.S. Equity|
|iShares CDN S&P 500 Index||1,150.9||0.15||-40.3||22.6||2||U.S. Equity|
|Source: Globe Investor|
© 2007 The Globe and Mail. All rights reserved.
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