Fund Market Monitor: Fund births, deaths, and updates

By on May 21, 2014

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Those who have been predicting the death of Canada’s mutual fund market may have been a bit premature. Combined assets under management for mutual funds and exchange-traded funds now exceed $1 trillion, with the lion’s share of that being managed by mutual funds. In a market that size, it’s hard to keep up with fund births, deaths, and new identities. Here are the highlights of what’s been happening over the past couple of months.

National Bank rebrands funds. A legendary brand is about to disappear from the Canadian mutual fund landscape. National Bank announced that it is rebranding the 25 funds under its well-known Altamira brand as National Bank Mutual Funds.

That new name is in itself a renaming of the old National Bank Securities Mutual Funds brand. Also renamed under the new National Bank Mutual Funds brand are the funds sold under the Omega brand. In a release, the bank says the portfolio managers will remain the same and the funds will remain otherwise unchanged.

Purpose Investments adds to ETF offerings. Boutique fund factory Purpose Investments is the brainchild of Som Seif, formerly the big wheel at ETF trailblazer Claymore Investments before it was snapped up by BlackRock Inc.

Now Purpose has added Purpose Best Ideas Fund (TSX: PBI) and Purpose Hedged Real Estate Fund (TSX: PHR) to its ETF lineup. The Best Ideas fund holds a portfolio of stocks that are also among the top holdings of 20 big-name investors including Carl Icahn and Warren Buffett. The Real Estate fund invests in real estate-focused equities and tactically hedges the duration of the portfolio to guard against interest rate risk. The company also launched the Purpose Tactical Hedged Equity Fund – Non Currency Hedged (TSX: PHE.B) – the fund name says it all.

iShares offers two Europe ETFs. Industry giant BlackRock Canada launched two new ETFs with diversified exposure to European stocks. The iShares MSCI Europe IMI Index ETF (TSX: XEU) tracks the MSCI Europe IMI Index of large, mid, and small-cap stocks from developed European countries. The iShares MSCI Europe IMI Index ETF (CAD-Hedged) (TSX: XEH) is the same fund hedged to the CAD Index.

Mackenzie launches income and low-volatility funds. Hoping to cater to older investors’ fears of volatility and desire for income, Mackenzie Investments launched its Mackenzie US Low Volatility Fund, Mackenzie Investment Grade Floating Rate Fund, Mackenzie Global Tactical Bond Fund, and Mackenzie US Dividend Fund, which is available in both registered (for RRSPs and RRIFs) and non-registered versions.

Bridgehouse debuts top ideas fund. Funds created from someone’s top stock picks are all the rage it seems. Now Brandes Investment Partners’ curiously named Bridgehouse Asset Managers division has debuted its Sionna Opportunities Fund, which provides exposure to between 20 and 30 of Sionna’s top stock ideas, with the aim of “delivering significant alpha while carefully managing risk,” said Sionna president and CIO Kim Shannon in a release.

Horizons launches swap-based bond ETF. Horizons ETFs Management (Canada) Inc., a subsidiary of South Korean financial conglomerate Mirae Asset Global Investment Group, launched its Horizons Cdn Select Universe Bond ETF (TSX: HBB), which it says will provide investors with low-cost and tax-efficient exposure to the Canadian investment-grade bond universe. The ETF tracks the performance of the Solactive Canadian Select Universe Bond Index and will be the first Canadian fixed-income ETF to use the total return swap structure of Horizons ETFs’ total return swap equity ETFs.

RBC’s new global fund offerings. Big-bank fund machine RBC Global Asset Management launched three new funds: RBC Global Equity Focus Fund, which invests in 30 to 70 high-quality companies from around the world; RBC International Equity Currency Neutral Fund, which uses a passive currency hedging strategy to mitigate exchange-rate risk; and BlueBay Global Convertible Bond Fund – Series T5, which aims to combine both fixed-income and equity assets for tax-efficient monthly payments.

Scotiabank seeks sale of its CI Financial holdings. In a move that surprised Bay Street analysts, Bank of Nova Scotia (TSX: BNS) announced last week that it wants to divest some or all of its 37% stake in mutual fund factory CI Financial Corp. (TSX: CIX). The bank reportedly redeploy the capital currently tied up in CI more profitably, including potential new acquisitions. CI reported that that assets under management at April 30, 2014, climbed to a record $97.3 billion.

Courtesy of Fundata Canada Inc. © 2014.