The fund is managed by
David Hoffman and
Stephen Smith of sub-advisors Brandywine Global Investment Management, based in
Philadelphia, PA, using a value-based approach by which they screen for
securities that offer the highest real yield and that are trading at
discounted valuations. Their process starts with a top-down macro analysis
that scans the globe looking for attractive real yields and currencies that
can benefit from the economic environment. They then look for attractive
points on the yield curve that will allow for profit opportunities.
The managers are very active in their approach, and their positioning
across securities, countries, and currencies will change frequently. Unlike
some of their global bond peers, Hoffman and Smith focus more on government
bonds, and only occasionally invest in credit. They will also manage
currency exposure as a profit center.
At the end of March, the fund was defensively positioned, with a yield to
maturity of 3.6% and a duration of approximately 3.2 years for the
portfolio. This is higher than what is offered by the Canadian bond market.
Geographically, as of April 30, the fund was weighted 52.6% to North
America, 15.4% to Asia, 14.3% to Latin America, and 1.2% to Europe, with a
smattering of other global issues filling out the balance.
Performance, particularly over the long-term, has been strong. For the five
years ending April 30, the fund posted an average annual 5-year compounded
rate of return of 5.2%, placing it in the first quartile of performance.
Year-to-date, the fund is up 3,4%, well above the category average.
However, the fund is not without its drawbacks. It has historically been
more volatile than many of its global bond peers and Canadian-focused bond
funds, with a 3-year average standard deviation of 6.12% as of April 30. It
is running at a level of volatility that is nearly twice that of the FTSE
TMX Bond Universe. It is also somewhat pricey, with an MER of 2.08.
Renaissance Global Bond Fund
CIBC Asset Management
Global Fixed Income
David Hoffman since Nov. 2006; Stephen Smith since Nov. 2006
ATL1028 (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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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.