Manulife World Investment Fund
is an excellent international equity fund. In fact, it is the
highly-regarded Mawer International Equity Fund in a
Manulife wrapper. The full-freight Manulife Advisor Series of this fund has
an MER of 2.56%, which includes full dealer compensation. However, for
those using fee-based accounts, the F Series version carries an MER of
1.2%, which is less than the 1.40% charged by Mawer directly for its own fund.
Certainly, some investors will be turned off by the higher cost of the
Advisor Series, and I get that. But I still believe that this is a case of
“you get what you pay for.”
One of the higher-rated international equity funds (for simplicity, I’ll
refer to the Advisor Series), its 5-year average annual compounded rate of
return to Jan. 30 was 7.4%, outpacing its both its category average peers
and benchmark index. The fund has recovered from the year-end market
correction, gaining 3.3% in the three months ended Jan. 31, while the
category eked out an average 0.9% return in the same period. Volatility has
been below the index and peer group, resulting in above average
Much of the fund’s recent underperformance was the result of the quality
focus inherent in the Mawer portfolios. In the broader market, the
higher-beta names had been outpacing value names, but that was not
sustainable, and the fund has rallied recently as strong fundamentals once
again begin to prevail in valuations.
and David Ragan
of Mawer Investments use a highly disciplined investment process, looking
for wealth-creating companies that are trading at discounts to their
estimate of intrinsic value, and that generate high returns on equity.
Mawer’s research process is one of the best in the business and includes a
rigorous scenario analysis to get a stronger understanding of a company’s
true worth under a range of situations.
The result is a portfolio that is made up of between 50 and 60 names, with
the top 10 making up 30% of the fund. Sector and country weights are
largely the result of the stock selection process. At the end of January,
the portfolio had 66% invested in Europe, about a third in Asia, with the
balance in the Americas. Nearly 90% is invested in developed markets, with
the rest in emerging markets.
Top holdings as of Jan. 31 included U.K.-based insurance company Aon PLC,
U.K.-based product testing firm Intertek Group PLC,
Dutch specialty publisher Wolters Kluwer NV, French industrial gas supplier Air Liquide SA,
and Japanese retailer
Seven & i Holdings Co. Ltd.
This fund remains a top pick for investors looking for a disciplined,
well-managed portfolio with a focus on non-North American stocks. If you
are a do-it-yourself investor, you’re better off buying through Mawer
direct, but for advisors, the Manulife wrapping is the best way.
Manulife World Investment Fund
Large Cap Blend
David Ragan, Peter Lampert
MMF4536 (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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