WHAT ARE WE LOOKING FOR?
Which funds were investors buying and selling in February when RRSP season was in full gear? It's interesting to see if performance was related to funds attracting and losing the most assets.
We screened for the track record of 10 funds with the highest net sales and 10 funds with the highest redemptions in February using figures from the Investment Funds Institute of Canada. We looked at returns from six months to 15 years ending Feb. 28.
WHAT DID WE FIND?
Two of the top sellers were balanced funds without even a one-year track record.
Dynamic Strategic Yield and IA Clarington Tactical Income (T6) obviously appeal to investors looking for yield in a low-rate environment. Both are also run by veteran managers.
Dynamic Strategic Yield, which opened March, 2009, was the third top seller. Managed by Oscar Belaiche and Michael McHugh, the fund now has an "attractive yield of 5.4 per cent," says Jordy Chilcott, executive-vice president with Dynamic Funds.
IA Clarington Tactical Income (renamed from IA Clarington Income Trust Fund in 2008) has had a track record since 2003, but the performance cannot be shown because it merged last June into the IA Clarington Diversified Income Fund. The merged entity kept the IA Clarington Tactical Income name, and has been run by Catapult Financial Management's Ben Cheng, hired to run one of the funds nearly two years ago. With the merger, the performance meter started over. The fund pays an annual targeted distribution of 6 per cent, paid monthly.
Top seller was Fidelity Canadian Asset Allocation. The A-version pulled in $172-million in assets with one-third coming from inclusion in packaged fund portfolios. The balanced fund, which has an impressive 9.4-per-cent average annual return over 15 years, has had two different lead managers. Bob Swanson took over in 2006 from Richard Habermann.
Among the biggest redeemers, PH&N Total Return Bond - D suffered from $91-million in net outflows even though it posted a decent average annual return of 5.3 per cent over five years. Most of the net outflows came from an institutional investor moving money around, said a spokeswoman for RBC Global Asset Management.
AGF Canadian Balanced saw $48.2-million in net redemptions. Long-time manager Christine Hughes resigned from the fund in January, but her successor Michael White is relatively unknown to financial advisers. Because the fund's 2.5-per-cent return over one year underperformed the 24.3-per-cent average for its peers, that may have led some investors to ditch it.
|Funds with the biggest net sales in February, 2010|
|Net||Latest||Returns (%) as of Feb. 28, 2010|
|Name||Asset Class||Sales*||Assets*||MER||6 mos.||1 yr||3 yr||5 yr||10 yr||15 yr|
|Fidelity Cdn Asset Alloc.-A||Cdn Equity Balanced||171.8||11,772.2||2.38||5.2||31.3||1.7||5.6||4.9||9.4|
|RBC Cdn Dividend||Cdn Div./ Inc. Equity||162.2||8,941.1||1.70||5.3||41.5||-1.3||5.4||9.8||11.7|
|Dynamic Strategic Yield||Cdn Ntrl Balanced||117.5||964.6||2.29||10.2|
|TD Mortgage||Cdn S-T Fixed Income||113.5||1,091.7||1.73||1.5||3.3||4.6||3.7||4.5||4.9|
|TD Short-Term Bond||Cdn S-T Fixed Income||100.2||1,683.8||1.05||2.3||6.3||5.1||4.0||4.9||5.1|
|Fidelity Cdn Balanced-A||Cdn Ntrl Balanced||96.8||3,971.4||2.22||5.6||26.6||1.9||5.3||6.1|
|IA Clarington Tactical Income-T6||Tactical Balanced||83.9||920.1||2.34||11.7|
|BMO Asset Allocation||Cdn Ntrl Balanced||78.9||1,200.0||2.01||2.8||23.3||0.9||4.8||4.7||7.1|
|Fidelity Monthly Income-A||Cdn Ntrl Balanced||74.2||1,984.9||2.23||10.4||37.8||2.5||6.7|
|PH&N High Yield Bond-D||High Yield Fixed Inc||73.9||1,600.5||0.93||6.8||22.2||7.1||7.5|
|Funds with biggest net redemptions in February, 2010|
|PH&N Total Return Bond-D||Cdn Fixed Income||(92.0)||2,351.8||0.58||3.4||13.6||5.3||5.3|
|Trimark Select Growth||Global Equity||(69.3)||2,214.4||2.42||3.9||18.7||-15.6||-5.0||0.9||4.0|
|Stone Flagship Grwth/Inc AA||Cdn Ntrl Balanced||(58.5)||167.2||7.5||29.8|
|Trimark Income Growth-SC||Cdn Equity Balanced||(55.6)||4,348.9||1.64||5.7||28.2||-3.9||0.9||6.7||7.3|
|Mackenzie Ivy Cdn||Cdn Focused Equity||(50.5)||1,739.2||2.38||7.1||16.6||-5.6||-1.3||3.5||6.2|
|AGF Cdn Balanced||Cdn Ntrl Balanced||(48.2)||1,395.4||2.55||2.5||2.3||-1.0||4.4|
|Mackenzie Ivy Growth & Income||Cdn Equity Balanced||(47.3)||1,681.7||2.10||5.7||13.9||-3.3||0.2||4.2||6.8|
|Templeton Growth Fund Ltd.||Global Equity||(44.8)||2,065.0||2.23||0.1||24.0||-11.6||-3.3||-0.6||3.3|
|Investors Real Property-C||Miscellaneous||(42.8)||2,382.0||2.73||-0.7||-2.4||1.4||4.2||5.1||5.3|
|Mackenzie Cundill Value C||Global Equity||(42.8)||5,129.9||2.43||3.0||32.0||-6.2||-0.3||5.8|
|DEX Short Term Bond Total Return||2.2||5.3||5.9||4.8||5.8||6.3|
|DEX Universe Bond Total Return Index||2.7||7.8||5.5||5.4||6.7||7.5|
|MSCI World ($ Cdn)||1.2||28.5||-9.4||-1.3||-2.6||4.3|
|S&P/TSX Total Return||8.5||47.6||-0.9||6.5||4.7||9.4|
|*All Figures in $ millions|
|Source: Globe Investor, GMP Securities, Investment Funds Institute of Canada|
© 2007 The Globe and Mail. All rights reserved.
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