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Analysis: This fund has been distinctly unimpressive in recent years. While the Canadian stock market as a whole was performing well, the returns here lagged well behind those of the peer group and we don’t see any indication that will change.
Manager Martin Hubbes uses a bottom-up investment style with a focus on mid to large-cap growth stocks. With the exception of a 13.6% loss in 2002, he produced double-digit gains in each calendar year from 2003 to 2006. But results since then have been weak. The three-year average annual compound rate of return to Feb. 28/11 was in negative territory at -0.55% compared to an average gain of 2.4% for the Canadian Equity category. The fund did generate a profit of 15.3% in the latest 12-month period but that was well below the 21.2% category average.
The portfolio is heavily concentrated in financial services and oil and gas, which together account for more than half the assets (53%). Top holdings include names like Suncor, Talisman, TD Bank, Bank of Nova Scotia, and Research in Motion, so the flavour of the portfolio is decidedly blue chip. If you are looking for a Canadian stock fund, there are much better choices.