SPOTLIGHT: Sizing Up Funds
Much Cash Not Always a Good Thing, Managers Say
At what size will a mutual fund's assets under management hinder a manager's
ability to outperform his peers? By capping a fund, some claim, a manager has
the flexibility to buy larger positions without tipping off their competitors,
while others with a larger asset base arguably trade less effectively. Keith
Damsell weighs the pros and cons.
Sometimes, Last Year's Winners Worth a Second Look
Though the cases are rare, a cogent argument can sometimes be made for buying
into funds that have exceeded most of their peers recently. Exhibits A and B:
Mackenzie Cundill Value and three of the O'Shaughnessy funds offered by RBC
Asset Management. Read Rob Carrick's reality check.
View the four funds on a Globeadvisor.com Fund Report
Indexing Makes Sense -- but not with Mutual Funds
Index investing does makes sense, writes Rob Carrick, unless you use index
funds. Costly to own, they're distant second choice behind ETFs as a way to
put the indexing strategy to work. Rob Carrick looks at the numbers.
MANAGER PROFILE: E&P's Ted
A Rookie no More, Ted Whitehead's got Game
In March, 2000, as the tech boom was hitting its peak, Whitehead was appointed
lead manager of a growth-oriented fund. He soon discovered how slow managing
equities could be, even in a hot market. Investors ignored the fund and kept
riding sure things, like Nortel. Whitehead has more than made up for his slow
rookie season. The Growth Opportunities Fund he runs for Manulife subsidiary
Elliott & Page has averaged 20%-plus annual returns and has about $378 million
in assets. Wayne Lilley reviews the stats sheet.
INDUSTRY NEWS: AGF, AIC and
Fourth-quarter Charges Put Dent in AGF's Bottom Line
Mutual fund company AGF Management Ltd. turned in a loss for the fourth
quarter amid rising costs -- including a $29.2-million settlement with the
Ontario Securities Commission. Keith Damsell explains AGF's earnings miss.
Weak Performance Plagues AIC
On the good news front, AIC has made a series of moves over the past year to
end redemptions. New fund managers have been brought on to improve
performance, the fee structure is under review and a new marketing team, led
by industry veteran David Whyte, has been hired to sell the AIC story. Read up
on AIC's current challenges.
January Sales Slip at Biggest Fund Firms
IFIC expects to report January net sales of between $1.3-billion and
$1.7-billion, which still falls short of net sales of $1.8-billion for the
same period a year ago. Click here to preview the numbers.
BOOK REVIEW: Retirement Myths
Beware of Doom-and-Gloom Retirement Warnings
It's always useful to read what your clients may be reading. The current
booklist includes a critical look at the investment industry by Chartered
Accountant David Trahair: Smoke and Mirrors, Financial Myths that will Ruin
Your Retirement. Read the book review.