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Analysis: This is a fund that is meant for mutual fund investors who are seeking a low cost way to gain exposure to the U.S. equity market. It is designed to track the S&P 500 Index less management fees.
The fund has recently performed well on a relative basis, finishing in the first or second quartile.
The fund is available in two series; an Investor Series, which carries an MER of 0.54%, which is well below the category average MER of 2.46%, or an e-Series which has a rock bottom MER of 0.35%.
There is also a currency hedged version available which hedges the currency exposure of the fund. For those investors who wish to remove the currency impact out of their portfolios, that may be a good option to consider.
While there is little doubt that this fund does a great job at tracking the index, the high levels of volatility and uncertainty in the markets would lead us to prefer a high quality actively managed fund over an index product for the near to medium term. We believe that an actively managed fund can do a better job at managing overall volatility and preserving investor’s capital in volatile markets. However, for long term investors unconcerned with the short term market gyrations, this fund is an excellent choice.