| Fund Company | HSBC Global Asset Management |
| Fund Type | Canadian Fixed Income |
| Rating | Not Rated |
| Style | Duration Credit Management |
| Risk Level | Low |
| Load Status | No Load |
| Manager | HSBC Fixed Income Team |
| MER | 1.17% |
| Code | HKB 506 |
| Minimum Investment | $500 |
Analysis: The HSBC Canadian Bond Fund is a pretty run of the mill bond fund that invests in a mix of Canadian corporate and government bonds, as well as some exposure to mortgages. Looking at the current asset mix, it is overweight in both corporate bond and mortgages, which is prudent given the interest rate environment. Combined, this will result in a lower sensitivity to interest rates than the broader bond market. Given the rate outlook, the managers expect to keep this positioning over the near term.
Performance has been more than respectable, consistently finishing in the upper half of the Canadian bond category. While it has outpaced many of its peers, it has failed to keep up with the DEX Universe Bond Index on an absolute basis. However, if we take it’s lower volatility into account, it has matched it on a risk adjusted basis.
Costs are decent, boasting an MER of 1.17%, which is below the category average.
All things considered, this is a pretty decent Canadian bond offering. Still, I would likely go with the Dynamic Advantage Bond or PH&N Bond over this one given their duration management approach, which I expect to add value over the near to medium term. That said, with the lower than average MER, you likely won’t go too far wrong with this fund.