| Fund Company | Beutel Goodman & Company Ltd. |
| Fund Type | Canadian Small / Mid Cap Equity |
| Rating | $$$$ |
| Style | Value |
| Risk Level | Medium |
| Load Status | Front End |
| RRSP/RRIF Suitability | Good |
| TFSA Suitability | Good |
| Manager | Stephen Arpin – since January 1995 William Otton – since January 2007 |
| MER | 1.49% |
| Code | BTG 799 |
| Minimum Investment | $5,000 |
Analysis: This has long been one of our favourite small cap funds available to investors today. The fund has consistency of management, having been managed by Stephen Arpin since 1995. Today, with the addition of William Otton, there is a solid management team in place.
In managing the fund, the managers follow a fundamentally driven, bottom up, value focused process. The team looks for undervalued companies, with quality management teams in place. The portfolio will hold between 30 to 60 individual securities with the top 10 names making up nearly 60% of the fund.
As the assets in the fund have risen, so too has the average market capitalization that the managers hold in the fund. Previously, the focus was on small cap stocks, however in recent years, the focus has shifted more towards the mid cap segment.
Performance has been strong, outpacing both the BMO Nesbitt Burns Small Cap Index and its peer group over the past ten year period. Volatility is high, with a level of volatility that is slightly above the broader market. Given the focus on small and mid cap stocks, this is not surprising.
Costs are very reasonable for this fund, with an MER of 1.49%, much lower than the 2.69% median for the category.
In our opinion, this fund is a great choice for investors seeking exposure to small and mid cap companies in their portfolio. However, with the high levels of volatility and uncertainty in the markets, investors will focus on high quality, dividend paying stocks, which may result in this fund struggling in the near to medium term.