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Powerhouse management drives Mackenzie Ivy Global Balanced Fund to FundGrade A+ Awards
6/21/2018 10:31:41 AM
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By Dave Paterson  | Wednesday, March 15, 2017


Over the past few years, there have been some minor changes to Mackenzie Ivy Global Balanced Fund that have certainly helped improve on its stellar equity sleeve. The first such change was bringing Steve Locke and his fixed-income team to take over management of the fixed-income portion of the fund. That’s clearly paid off, as the fund consistently attains a monthly FundGrade A Grade ranking. It was also awarded the FundGrade A+ Award for outstanding performance in 2016, having also garnered the Award in 2013 and 2014.

Using a core-plus approach, the Mackenzie team has a lot of flexibility and can invest in a wide range of fixed-income options, including high-yield bonds, floating rate notes, and real return bonds. Still, the bonds remain conservatively positioned, with the majority focused on investment-grade bonds, with only a smaller exposure to higher-yield issues.

The second change that has helped was to bring Alain Bergeron in to oversee the asset mix of the fund. Before he took over, that task was left to the managers. Now, they can focus on what they do best, which is manage the investments while Mr. Bergeron will tweak the mix based on his outlook. The neutral asset mix for the fund is now set at 73% equity and 23% bonds, but can range between 60% and 90% in equity. At the end of December, it was around its neutral mix.

Turning to the equity sleeve, it looks very similar to the highly regarded Mackenzie Ivy Foreign Equity Fund, with a very similar sector mix and comparable valuation metrics. There is also significant overlap between the holdings. The portfolio is quite concentrated, holding just 35 stocks. Top holdings at the end of February included systems software company Oracle Corp. (NYSE: ORCL), footware firm Nike Inc. (NYSE: NKE), asset manager Brookfield Asset Management Inc. (TSX: BAM.A), trading company W.W. Grainger Inc. (NYSE: GWW), and health care distributor Henry Schein Inc. (NASDAQ: HSIC).

Performance has been strong across all time periods, as the fund handily outpaces its peers with an average annual compounded rate of return of 8.25% over 3 years and 10.82% over 5 years. Like other Ivy branded products, volatility has been below average. Furthermore, the fund offers excellent downside protection compared with its benchmark

I would expect Mackenzie Ivy Global Balanced Fund to lag in a rising market, but it should outperform in a falling market.

Mackenzie Ivy Global Balanced Fund
Fund company:
Mackenzie Investments
Fund type:
Global Equity Balanced
FundGrade Rating: A
FundGrade A+ Award:
2013, 2014, 2016
Style: Large Cap Blend
Risk level: Medium
Load status: Optional
RRSP/RRIF suitability: Good
Manager: Paul Musson since May 2001; Steve Locke since May 2013
MER: 2.32%
Fund code: MFC086 (front end load)
Minimum initial investment: $500

Dave Paterson, CFA, is the Director of Research, Investment Funds for D.A. Paterson & Associates Inc., a consulting firm specializing in providing research and due diligence on a variety of investment products. He is also the publisher of Dave Paterson’s Top Funds Report, offering regular commentary and in-depth analysis of Canada’s top investment funds. He uses a unique analytical approach to identify funds with strong, risk-adjusted returns, and regularly publishes his insights and analyses in Fund Library.

Notes and Disclaimer

© 2017 by Fund Library. All rights reserved. Reproduction in whole or in part by any means without prior written permission is prohibited.

Commissions, trailing commissions, management fees and expenses all may be associated with fund investments. Please read the simplified prospectus before investing. Mutual funds are not guaranteed and are not covered by the Canada Deposit Insurance Corporation or by any other government deposit insurer. There can be no assurances that the fund will be able to maintain its net asset value per security at a constant amount or that the full amount of your investment in the fund will be returned to you. Fund values change frequently and past performance may not be repeated. No guarantee of performance is made or implied. This article is for information purposes only and is not intended as personalized investment advice.

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