The Pathetic Performance of Canadian Mutual Funds in 2014

S&P

Have your heard of the S&P SPIVA Canada Scorecard? S&P reports on the performance of active Canadian mutal funds vs. a variety on low cost passive index funds. Its analysis is impeccable and the results are disturbing for anyone thinking of buying mutual funds from your friendly bank or investment sales person.

Here are the highlights for 2014 (2015 numbers come out in the spring).

Canadian Equities

” Rising markets proved to be difficult for active managers to overcome, as the majority of Canadian active managers saw their returns lag behind the benchmark, with just 26.47% of Canadian Equity Funds outperforming the S&P/TSX Composite.”

Canadian Dividend Mutual Funds

“Only 6.67% of the active Canadian Dividend & Income Equity Funds outperformed the S&P/TSX Canadian Dividend Aristocrats over the past 12 months.”

Foreign Equities

“Over the past 12 months ending Dec. 31, 2014. only 5.95% of Global Equity managers had higher returns than the benchmark”.

“Over the five-year period, only 13.16% of active International Equity Funds were able to beat their benchmarks, and only 2.83% of active Global Equity Funds and 2.9% of active U.S. Equity Funds outpaced the S&P EPAC LargeMidCap, S&P Developed LargeMidCap, and S&P 500, respectively.”

You can read the full report here.

http://www.theglobeandmail.com/globe-investor/investment-ideas/research-reports/article23990888.ece/BINARY/spiva-canada-scorecard-yearend-2014.pdf

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