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Flexibility helped Trimark equity fund bounce back

What are we looking for?

North American equity funds that have outpaced both major Canadian and U.S. indexes.

These funds can buy Canadian or U.S. stocks, and invest up to 10 per cent outside of North America. Let's look at how these investments have done over three years, which includes the 2008 market crash.

The screen

We ranked the funds by best performance for the three years ended March 31. U.S. dollar, segregated and duplicate versions of the funds were excluded.

What did we find?

Four funds beat the S&P/TSX total return index and S&P 500 composite in Canadian dollars, but only Trimark North American Endeavour Class posted a double-digit return.

That Trimark fund emerged with an annualized gain of 12.5-per-cent gain, trailed by three Mackenzie funds with returns ranging from 7.8 per cent to 5.5 per cent.

Trimark North American Endeavour Class has been managed by Jason Whiting since August, 2007, when he revamped the $12-million AIM American Mid Cap Growth Class to conform to a North American equity mandate.

The fund has been mostly invested in U.S. stocks over three years, but the Canadian equity weighting has risen to 36 per cent from 20 to 25 per cent in 2007, he said.

The fund's outperformance stems partly from not getting hurt as much as some peers, although it did lose 24 per cent in the 2008 market meltdown. "Not going down a lot is a huge help to long-term performance," he said.

Mr. Whiting, who runs a portfolio of about 20 stocks, owned names that snapped back nicely in the market rebound, but he also took profits in stocks that he had picked up during the 2008 downturn, such as American Express Co. and Carnival Corp. Rovi Corp., a provider of interactive TV guides for cable and satellite services, is one stock that has been in the fund for three years, and "is by far the single biggest contributor to the fund," he added.

Because the fund's asset size is only about $25-million, it has the flexibility to own smaller names such as Canadian tech GuestLogix Inc., which has a market cap of $5-billion, as well as giants like U.S.-based Cisco Systems Inc., which is closer to $100-billion (U.S.). "I am trying to find unique ideas [like GuestLogix] where there is a big opportunity, and also a contrarian ideas" such as Cisco, which has been punished for its loss of market share and falling margins, Mr. Whiting said.



ASSETS3 YR Avg Return Year to DateAnnual Returns (From Jan 1 to Dec 31)
FUNDMER (in Millions)(Periods ended March 31, 2011)201020092008200720062005
Trimark N Amer Endvr Class2.8324.712.53%-1.20%24.51%55.71%-24.28%-20.93%10.10%-0.21%
Mackenzie Ivy Enterprise2.44126.87.75%3.18%17.79%14.32%-16.92%-0.83%6.67%0.29%
Mackenzie Saxon Explorer Class2.5037.46.58%3.61%9.95%45.14%-31.83%-12.79%4.76%-0.47%
Mackenzie Univ NA Growth Class2.49254.85.51%4.17%7.74%25.21%-21.80%11.97%n/an/a
Tonus Selectn/an/a4.68%-0.64%13.52%5.00%-6.06%n/an/an/a
ABC North American Deep-Valuen/a119.84.66%8.21%44.14%54.07%-56.62%-11.81%3.92%25.49%
Investors North American Equity-A2.69656.03.69%3.70%11.28%30.97%-30.00%-1.35%10.75%11.99%
Mackenzie Cundill American Cl2.4833.61.89%6.87%12.94%31.87%-38.70%-8.85%13.66%0.43%
Matrix North American Eq-A2.240.7-0.70%1.10%4.05%22.67%-26.34%n/an/an/a
BMO North American Dividend2.4449.3-1.78%5.71%7.90%1.85%-24.73%-8.10%20.79%15.10%
RBC North American Dividend2.04143.1-2.51%1.18%8.51%11.05%-26.99%-3.62%15.06%20.11%
TD North American Dividend-A2.45n/a-2.99%4.09%5.67%5.89%-24.26%n/an/an/a
Renaissance US Equity Growth2.6415.4-3.83%0.92%13.93%10.09%-37.76%-9.50%2.26%1.95%
S&P/TSX Total Return4.97%5.60%17.61%35.06%-33.00%9.83%17.26%24.13%
S&P 500 Composite ($ Cdn)-1.78%3.01%7.18%5.51%-23.76%-12.21%13.56%-0.22%
MSCI North America Index ($ Cdn)1.07%3.91%9.93%9.84%-22.20%-8.69%15.04%4.26%
Source: Globe Investor

© 2007 The Globe and Mail. All rights reserved.

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