CI Cambridge Canadian Dividend Fund

Analysis: Since Cambridge took this fund over a little more than a year ago, they have definitely put their mark on it. This is not your typical dividend fund. It is significantly underweight in financials, and in fact, there is not a Canadian bank to be found. It is also underweight energy, because most of the energy names they like don’t typically pay dividends, which would exclude them from this fund. Another differentiator is it has more mid-cap names than most. The portfolio is relatively concentrated, holding less than 30 positions.

Portfolio turnover has been high since they took over, but that is to be expected given the portfolio transition. Cambridge generally tends to run higher turnover portfolios. They can be quite active, making shorter term tactical investments where opportunities exist. They will also use market volatile as a way to upgrade the portfolio by picking up high quality names at a cheaper price.

From here, I would expect that portfolio turnover will settle somewhere in the 150% to 200% range, which is comparable to other Canadian equity mandates managed by Cambridge.

Cash will also be dependent on the available investment opportunities. They will let it grow when they don’t see much in the way of suitable investments. At the end of November, they held 11.5% in cash, which was down from 17% at the end of September.

Performance has been excellent, gaining more than 20% so far this year. Going forward, I would expect to see performance remain strong and volatility remain well below average.

It pays a monthly distribution, which is currently set at $0.03 per unit. At current prices, this works out to an annualized yield of 1.75%.

Costs are higher than the average Canadian dividend fund. However, all things considered, this is a very solid fund, and can easily be considered a core Canadian equity holding for most investors.