The new top funds in Canada

Anyone who thought the first annual Lipper Fund Awards for Canada would simply be a repeat of the Canadian Investment Awards handed out less than four months ago was woefully mistaken. With 30 trophies up for grabs, only five funds won top fund in their category in both events.

At the inaugural event hosted by the Denver, Colorado-based mutual fund rating company in Toronto Wednesday night, Dynamic Funds took home the largest haul of awards, walking away with five trophies. “This distinction is a testament to the success of our team-based approach and the quality of our investment talent,” said David Goodman, the president & CEO of Dynamic Funds in a release.

TD Asset Management was a close second with four awards.

Remarkably, there was very little overlap between the two competing awards, considering both use similar metrics to pick the winners. Lipper’s awards are based on consistently strong risk-adjusted performance relative to their peers for the three-year period ending Dec. 31, 2006, while the winners of the comparable CIAs are determined by senior analysts, based on absolute performance, relative performance, risk/return profile and tax efficiency, along with other considerations like fees and management.

The five funds that won at both events were Dynamic Canadian Value Class for best Canadian equity fund; Dynamic Focus+ Small Business for top Canadian income trust fund; Phillips, Hager & North Short Term Bond & Mortgage for best Canadian short-term bond and mortgage fund; PH&N’s High Yield Bond Fund for best high-yield bond fund; and the Trimark U.S. Small Companies Class for the best U.S. small/mid cap equity.

RBC Asset Management took home the overall fund award, although none of the company’s funds won in the individual categories. (Although, RBC did win one award at the CIAs in November in the bond fund category.)

(Please click here to see a complete list of the winners and how they compared with the top funds identified by the Canadian Investment Awards held late last year).

The Lipper Fund Awards have been held in 21 countries, including Canada, to reward funds that have excelled in delivering consistently strong risk-adjusted performance relative to their peers.

Although Lipper is widely known around the world, particularly in the U.S. and Europe, a smattering of attendees admitted during a cocktail reception before the awards ceremony that they had never heard of Lipper. To many, awards have been the best exposure Lipper has had since it announced its intention to expand its services to Canada.

“It’s a slow process,” says Andrew Clark, Lipper’s head of research for the Americas. Lipper, which is owned by Reuters, faces stiff competition in Canada from firms like Morningstar, Cannex and the Globe and Mail.

Canadian advisors haven’t had exposure to Lipper so far, and that’s not likely to change in the short term. As Clark explains, Lipper’s focus is on serving institutions, not advisors or investors. “We are not going to push Morningstar out, because they do a good job when it comes to the advisors and the retail investors, and we’ve never competed there,” he says.

Mainly, Lipper offers tools and data used internally by funds to help make their businesses better, explains Clark. For instance, Lipper can provide a detailed breakdown of expenses for a fund, which isn’t immediately relevant to the average investor or advisor.

Still, in time, advisors will have to become acquainted with Lipper’s services. “Once we get ourselves established, the institutions themselves will start pushing the Lipper data down to the advisors,” says Clark. “I don’t see that happening right away or even over the intermediate term. It’s going to take us a while to crack the top 25 institutions, and that’s our focus at this point.”

LIPPER GROUP AWARDS
Overall	RBC Asset Management
Bond Fund Family	Phillips, Hager and North Investment Management
Equity Fund Family	Dynamic Funds
Mixed Asset	Acuity Funds
INDIVIDUAL AWARDS
	Lipper	Canadian Investment Awards
Asia ex-Japan Equity	Fidelity Far East Fund	n/a
Asia/Pacific Rim Equity	Dynamic Far East Value Fund	Fidelity Far East*
Canadian Balanced	OTG Balanced Fund	Harbour Growth & Income
Canadian Balanced Equity Focus	AIC Canadian Balanced	n/a
Canadian Bond	Altamira Bond	PH&N Bond
Canadian Dividend & Equity Income	TD Canadian Equity – I	n/a
Canadian Equity	Dynamic Canadian Value Class	Dynamic Canadian Value Class
Canadian Equity (Pure)	Elliot & Page Core Canadian Equity	n/a
Canadian Income Balanced	Dynamic Value Balanced Fund	CIBC Monthly Income
Canadian Income Trust	Dynamic Focus + Small Business Fund	Dynamic Focus + Small Business Fund
Canadian Short-Term Bond & Mortgage	Phillips, Hager & North Short Term Bond & Mortgage Fund	Phillips, Hager & North Short Term Bond & Mortgage Fund*
Canadian Small Caps	Sceptre Equity Growth Fund	Ethical Special Equity Fund/Clarington Canadian Small Cap
Canadian Tactical Asset Allocation	National Bank/Fidelity Canadian Asset Allocation	RBC Global Bond*
Emerging Markets Equity	TD Latin American Growth – I	AGF Emerging Markets
European Equity	Investors European Mid-Cap Equity	AGF European Equity
Financial Services	Fidelity Focus Financial Services Fund	AGF Global Financial Services
Foreign Bond	DFA Five-Year Global Fixed Income	n/a
Global Balanced	Franklin Templeton Global Growth Portfolio	Trimark Global Balanced*
Global Balanced – Equity Focus	GGOF Asian Growth and Income Fund	n/a
Global Equity	Dynamic Global Discovery Fund	Mackenzie Cundill Value
Healthcare	CI Global Health Sciences Corporate Class	Talvest Global Health Care
High Yield Bond	Phillips, Hager & North High Yield Bond Fund	Phillips, Hager & North High Yield Bond Fund*
International Equity	CIBC International Small Companies Fund	AGF International Stock
Japanese Equity	TD Japanese Growth – I	n/a
Natural Resources	TDK Resource Fund	Dynamic Focus+ Resource
North American Equity	BMO North American Dividend Fund	n/a
Precious Metals	Sentry Select Precious Metals Growth Fund	AGF Precious Metals
Science & Technology	TD Entertainment & Communications – I	Northwest Specialty Innovations
US Equity	DFA US Large Cap Value Portfolio	Chou Associates
US Small/Mid Caps Equity	Trimark US Small Companies Class	Trimark US Small Companies Class
* Denotes fund in closest comparable category

Filed by Mark Brown, Advisor.ca, mark.brown@advisor.rogers.com

(03/29/07)