| Fund Company | Guardian Capital LP |
|---|---|
| Fund Type | Global Equity |
| Rating | C |
| Style | Blend |
| Risk Level | Medium |
| Load Status | Front End Load |
| RRSP/RRIF Suitability | Excellent |
| Manager | Sri Iyer since May 2011 |
| Fiona Wilson since May 2011 | |
| MER | 2.32% |
| Fund Code | GCG 570 - Front End Units |
| Minimum Investment | $5,000 |
Analysis: This go anywhere, global dividend fund is managed by Sri Iyer and his team at Guardian Capital, using a proprietary, multi factor quantitative model that screens the global equity universe looking for positive rates of change in the fundamentals of companies. These factors include growth, payout ratios, efficiency, valuation, and investor sentiment. Further, the team will conduct a fundamental review to validate any of the potential buy candidates to ensure the rating is appropriate.
The result is a well-diversified portfolio that holds between 70 and 100 names, holding just under 90 stocks at the end of December. The sector and country mix is the byproduct of the stock selection process.
Nearly 55% is invested in U.S. equities, with European names making up most of the rest. The fund is conservatively positioned – overweight the more defensive sectors such as consumer defensives, communications, and utilities. It is underweight financials, consumer cyclicals, and material. This would be expected to hold up well in periods of higher volatility.
I really like the investment process used by the managers. It is disciplined and repeatable. It focuses more on rates of change rather than the absolute values which can help identify trends sooner. I like that it takes a lot of the emotion out of the process, yet has the fundamental oversight of the investment team for verification. It is not a black box strategy.
I would expect this fund to deliver average to above average returns, with lower than average volatility. It is also quite different than its benchmark. This of course can be a double edged sword, and could potentially result in periods where it underperforms for an extended period of time. Still, I believe it can be a great core global equity holding for most investors.
If you are unable to purchase this fund through your advisor, you could invest in the BMO Global Dividend Fund (GGF 70725), which is virtually identical, except for a slightly higher MER – 2.48% vs. 2.32%. If you prefer an ETF, you could look at the Horizons Active Global Dividend ETF (TSX: HAZ).