| Fund Company | Invesco Canada |
| Fund Type | Global Equity |
| Rating | D |
| Style | Blend |
| Risk Level | Medium |
| Load Status | Optional |
| RRSP/RRIF Suitability | Good |
| TFSA Suitability | Good |
| Manager | Michael Hatcher since April 2011 Darren McKiernan since April 2011 Jeff Feng since April 2011 |
| MER | 1.73% Series SC, 2.87% Series A |
| Code | AIM 1513 – Front End Units (SC) AIM 1511 – DSC Units |
| Minimum Investment | $500 |
Analysis: The Trimark Fund has been a staple on my Recommended List for a number of years. The management team of Michael Hatcher, Darren McKiernan and Jeff Feng run a concentrated portfolio of high quality, well managed businesses that have sustainable competitive advantages and the ability to generate strong levels of free cash flow.
It will generally hold around 40 names with the top ten making up about a third of the fund. Individual position sizes will typically be equally weighted, because they don’t believe that they can consistently pick the best performing stocks over short periods of time.
Because the fund is built on a stock by stock basis, it has a sector mix that is much different than its index. Currently, they are overweight in consumer focused names and technology, while are underweight in real estate, communications and utilities. They tend to take at least a three to five year outlook when evaluating an investment, which is reflected in their relatively modest levels of portfolio turnover. They will sell a company for a few reasons including a change in their investment thesis, they believe the stock has become fully valued, or they find a better idea.
Like their sector exposure, the cash weighting is also a byproduct of their stock selection process. If they cannot find any suitable investments, cash will rise. Currently, it is sitting at around 8%. While this will help protect the value of the fund in periods of market volatility, it will drag performance in a market rally. They tend to be more active in volatile periods, stepping in and picking up quality companies at lower valuations.
While this fund has been on my Recommended List forever, we prefer the SC units to the A Series units. The reason is one of cost, with the SC units carrying a more reasonable MER of 1.73% compared with 2.87% for the A units. If your only option is to purchase the A-Series units, you are better off finding another global equity alternative. However, if you can access the SC units and have a long term time horizon, then this may be a good core global equity holding.