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Number Cruncher

Bets on bricks and mortar boost winning global funds Add to ...

What are we looking for?

Leaders and laggards among global equity funds.

Stock markets have been volatile over the past year because of concerns about the euro-zone debt crisis and slower growth in China, United States and Europe.

The screen

We looked for the eight best and eight worst performers for the year ended June 30. U.S. dollar, segregated and duplicate versions of funds were excluded. Funds aimed at accredited investors, or which are parking lots for rollovers from flow-through limited partnerships were also out of bounds.

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What did we find?

Four global infrastructure funds are building a head of steam.

BMO Global Infrastructure ETF rose to the head of the global equity class with a 20.6-per-cent gain. (That contrasts with struggling Manulife Global Opportunities Class with a 20.4-per-cent loss.) Manulife Global Infrastructure, Dynamic Global Infrastructure and Sentry Infrastructure also turned in solid returns, ranging from 11.7 per cent to 7.9 per cent.

The low-fee BMO ETF, which is 67 per cent invested in United States, has nearly half of its assets in utility stocks, and 37 per cent in energy infrastructure securities. Two of the exchange-traded fund’s top 10 holdings are Canadian: TransCanada Corp. and Enbridge Inc.

Infrastructure companies turned in “some impressive returns over the last year because market volatility led investors to seek out more defensive-oriented plays,” said Alfred Lee, an investment strategist with BMO ETFs at Bank of Montreal.

Infrastructure firms tend to have long-term contracts so their revenue streams are relatively predictable, while investment themes such as emerging-market urbanization and aging infrastructure in developed markets “continue to be a tailwind” for results, he added.

The BMO ETF’s winners included American Tower Corp., which operates wireless communications and broadcast towers in North America. It gained 35 per cent over the period. Kinder Morgan Energy Partners LP, a pipeline transportation and energy storage company, rose 16.7 per cent. “The company attracted a lot of interest after hiking its dividend by 17 per cent,” Mr. Lee said.

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Leaders and laggards among global equity funds over the year to June 30

FUND NAME MER Assets ($mil) 1-yr % (Jun 30) 3-yr % (Jun 30) 5-yr % (Jun 30) 2011% 2010% 2009% 2008%
Leaders
BMO Global Infrastructure Index ETF 0.62 46.8 20.61% 19.65%
Manulife Global Infrastructure 3.13 29.9 11.66% 13.19% 9.56% 7.61% 20.98%
TD Entertainment & Communications 2.81 143.4 9.54% 17.30% 3.57% 0.33% 17.86% 41.45% -34.57%
Dynamic Global Infrastructure 2.60 294.2 9.48% 13.57% 12.16% 10.17% 16.61% -26.09%
Trimark Global Dividend Class A 2.59 47.1 9.20% 9.62% -1.88% 6.29% 5.38% 10.09% -22.01%
Sentry Infrastructure-A 2.85 62.4 7.94% 13.13% 9.16% 12.04%
CIBC Global Technology 3.03 29.7 7.39% 9.87% 0.48% -4.99% 8.80% 37.27% -30.44%
Renaissance Global Sci & Tech 2.99 10.1 7.18% 9.20% 0.84% -4.67% 7.82% 36.35% -28.03%

Source: Lipper

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