Managed by Greg Peterson of Calgary based Mawer Investment management, this fund looks a lot like the highly regarded Mawer Balanced Fund. It is set up like a fund of funds that invests in other Manulife managed mutual funds. At the end of September it was about a third in the Manulife Canadian Bond Fund, a third in the Manulife Canadian Investment Class Fund, 20% in Manulife Global Equity Class, and just under 10% in the Manulife Global Small Cap Fund.
Each of the underlying funds are managed by Mawer. The Manulife Canadian Investment Class is the Mawer Canadian Equity Fund, but with embedded dealer compensation. Manulife Global Equity Class is the Mawer Global Equity Fund, and the Manulife Global Small Cap Fund is the Mawer Global Small Cap Fund. Each of these funds are consistently at or near the top of their respective categories.
Equities are managed using the same fundamental, bottom up, GARP approach that looks for wealth creating companies that trade at a discount to intrinsic value. They take a very patient approach. Their culture is research focused, and all assumptions in the investment process are subject to rigorous stress test and scenario analysis before any decision is made.
If I had to pick a weak spot in the fund, it is the fixed income fund, which is a higher fee version of the Mawer Canadian Bond Fund. Further, it looks a little too index like for my tastes, especially once we hit a patch of rising rates. The portfolio holds more than half in governments, and just over a third in corporates. It only invests in investment grade bonds, effectively limiting options.
The asset mix is based on their macro call on which asset classes are likely to offer the best risk adjusted return. They don’t move the mix much, and any changes are done very gradually.
Unfortunately, two of the underlying funds; Canadian Investment Class and Global Small Cap have been capped to new investors. As a result, this fund has also been closed to new investors since March of 2013. Still, this is an excellent fund and I expect above average risk adjusted returns. If you hold it, consider yourself fortunate.