Managed by the team of
Trimark Global Dividend Class
invests in high-quality, dividend-paying companies around the world. It is
managed using the Trimark philosophy that looks for well-managed companies
that are likely to deliver high returns on invested capital and generate
significant free cash flow. Given the dividend mandate, the managers also
seek out a sustainable and growing stream of dividends.
The bottom-up process results in a somewhat concentrated portfolio,
typically holding around 40 names. Sector mix and country allocations are
the by-product of the stock selection process. Perhaps not surprisingly,
the sector mix looks much different than its benchmark. At the end of
February, it was overweight higher-yielding sectors, such as industrials
and consumer defensives. Surprisingly, it was also overweight technology,
which is not something you see in a lot of dividend-focused offerings.
As of Feb. 28, top holdings included
Wells Fargo & Co. (NYSE: WFC),
Walt Disney Co. (NYSE: DIS),
Visa Inc. (NYSE: V),
Honeywell International Inc. (NYSE: HON), and
W.W. Grainger Inc. (NYSE: GWW).
The managers are disciplined on valuation and are not afraid to let cash
build when they are having trouble finding opportunities that fit their
criteria. At the end of February, the fund held 11% in cash, which will
help to provide a buffer against any market selloff. It will also act as a
source of “dry powder,” allowing the managers to use periods of
higher-than-normal volatility as a chance to step in and pick up
high-quality investments at attractive prices, thus improving the quality
of the portfolio.
The focus on quality and valuation has paid off, with a 1-year gain of
nearly 18%, which makes the fund an above-average performer in the global
equity category. In the longer term, numbers are also strong, with a 3-year
average annual compounded rate of return of 11.0%, placing the fund in
top-quartile performance. Volatility has been lower than both the benchmark
and the peer group.
This as a solid core global equity fund for the long term. I would expect
some underperformance as the current high levels of valuation normalize,
but would still expect strong downside protection compared with the index
and peers, resulting from the quality focus and high cash balance.
Trimark Global Dividend Class
Large Cap Growth
Michael Hatcher since Sept 2013; Jeff Feng since October 2009
AIM24913 (Front-end load)
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
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.
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only and is not intended as personalized investment advice.