| Fund Company | CI Investments |
| Fund Type | Global Neutral Balanced |
| Rating | B |
| Style | Blend |
| Risk Level | Low – Medium |
| Load Status | Optional |
| RRSP/RRIF Suitability | Good |
| TFSA Suitability | Good |
| Manager | Eric Bushell since February 2007
Geof Marshall since February 2007 John Shaw since February 2007 Scott Vali since February 2007 |
| MER | 2.47% |
| Code | CIG 2111 – Front End Units
CIG 3111 – DSC Units |
| Minimum Investment | $500 |
Analysis: This is a tactically managed balanced fund run by Eric Bushell and his team at Signature Global Advisors. The fund’s asset mix is actively positioned across investment grade bonds, high yield, equities, and resources, based on the team’s macro view.
The managers have a great deal of flexibility around the asset mix. For example, the equity weight can range between 30% and 75% and fixed income can range between 25% and 70%, with high yield making up at least 15% and no more than 40% of the fund. They also have the ability to take the cash weighting of the fund as high as 30% if they feel the environment warrants it. Foreign currency exposure is actively managed.
The team has definitely taken advantage of this ability. For example, the fund held nearly 40% cash in December 2008, yet by September 2009, it was fully invested. At the end of February, it held just under 20%. They are equally as active in their approach to the other asset classes, all of which have fluctuated since the fund’s launch.
As important as asset allocation has been, security selection is equally important. The fund uses the Signature team to use their holistic approach to research, not only analyzing the fundamental quality and managerial talent of the company, but also studies the various segments of its capital structure, looking for the most attractive area to be invested. The team has analysts for each global sector and asset class who is focused purely on security selection.
The approach seems to have worked. For the five years ending February 28, it has generated an annualized return of 13.82%, handily outpacing the benchmark and its peer group. While performance has been decent, volatility has been higher than average. It was hit particularly hard in 2008, when it lost 22%, and finished firmly in the bottom quartile.
Looking ahead, I expect more of the same. The Signature team has a very strong process in place that should continue to deliver above average risk adjusted returns over the long term. However, given their flexibility, I expect we will see periods of higher volatility, where performance is dramatically different than both the index and its peer group.