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Mawer Launches New Fund

16K views 54 replies 19 participants last post by  getliquid 
#1 ·
#4 ·
MER includes various trading costs. They are not charging you 1.6 percent, but the cost is 1.6 percent. Running an active EM fund is more difficult and expensive than running something in N America.

Not that I am advocating this fund but by Canadian standards it's not expensive for EM.
 
#5 ·
I'm hesitant to describe Mawer as a grifter -
true the company is in the business to make $, but for the most part their funds are more reasonable than most. Their Balanced fund costs less that 1% MER - which is close to some expensive ETF's.
I can't think of any US, Int'l or emerging Market Funds that charge less than 1.5%. I know that Mawer has it's research advisers posted in many different countries, it is likely that the fee is designed to support these teams - (as well as make a profit)
 
#19 ·
i was commenting on inaccurate lumping together of trading costs as part of MERs in post No 4 above.

MER includes various trading costs.
the honourable member was talking about MERs & trading costs in general. Everyone knows that "trading costs" are commission costs, which are not included. In the context, the statement was a bit misleading.

.
 
#23 ·
What I do like about MAW is how they stop accepting contributions once a fund reaches certain size. That shows integrity, although there has to be an element of marketing there too. And their costs compare favourably to the racket offered by the big five. Either way, it benefits investors.

Still, I don't hold any MAW funds as this wouldn't align with my investment policy.
 
#25 ·
Depends when you bought. The fund's benchmark was changed late last year to add emerging markets.
See this link: http://www.mawer.com/our-funds/fund-profiles/international-equity-fund/

** Mawer International Equity Benchmark History:
Jan 1988: MSCI EAFE (net)
Oct 2016: MSCI ACWI ex-USA (net)

Rationale for Change: MSCI ACWI (net) excluding US Index is a better representation of the mandate in our opinion. For example, the past benchmark does not include Emerging Markets whereas the fund has holdings in these markets consistent with its prospectus and investment policy statement.
 
#28 ·
Dubmac, not sure if you are thinking the Int fund held 15% in MAW160 or some other emerging mkts fund but that is not the case. The positions were held as individual companies, and MAW160 is a new fund as OP noted.
I wouldn't be surprised though to see funds like 102, 104, begin to use MAW160 for their emerging mkt coverage.

James, MAW104 of course has its own benchark which is: 5% FTSE TMX 91 Day T-Bill Index, 5% Citi World Government Bond Index, 30% FTSE TMX Canada Universe Bond Index, 15% S&P/TSX Composite Index, 15% S&P 500 Index (CAD), 15% MSCI EAFE Index (Net, CAD), 7.5% BMO Small Cap Index (Blended, Weighted) and 7.5% Russell Global Small Cap Index (Gross, CAD) . They acknowledge that they don't try to replicate the holdings of this benchmark, and that they underperformed it last year at 3.2% vs 7.4%.

The Q4/2016 discussion of results is worth reading. Forex is noted as a significant headwind, and as you noted, their underwieghting in Canada and in cyclicals hurt results last year as well. http://www.mawer.com/assets/Newsletters/2016/2016-Q4-Newsletter-NET.pdf

Disclosure - I own MAW104
 
#29 ·
thanks...I didn't know this either - but it makes sense & is consistent with what I have seen when I check their holdings in each equity fund - which I do periodically. I have never seen their equity funds hold other funds or ETF's - only companies and some cash
 
#30 ·
If the Mawer International Equity Fund or Mawer Global Small Cap Fund are any indication, they both handily beat their respective indexes over almost all time periods with lower betas. Mawer International Equity has a 5 year return of 13.21% and a 10 year return of 4.42% versus 13.08% and 2.67% for the index.

Mawer Global Small Cap has a 5 year return of 22.3% (no 10 year available) versus 11.97% for the index.

I still own the indexes as well but there could be an argument that good mutual funds can add value - particular in the small cap and emerging market categories.
 
#41 ·
There are some good mutual funds out there, and they can perform well even with high MERs.

One example that comes to mind is Beutel Goodman Small Cap (1.49% MER). Its 5 year performance is 9.68% per year. Compare that to the low fee index ETF, iShares XCS, which only returned 2.31%. No contest! I bring up this example because Canadian small caps are another specialized area where a good manager adds value.

Straying off topic, but the 15 year performance of Beutel Goodman Small Cap is a whopping 10.23% per year. The only thing that repelled me from this fund was the front end load (or is it another load)? Those confuse the heck out of me. It might still be worth holding despite that.
 
#43 ·
Yeah, Beutel Small Cap caught my eye too. I am buying it through work at 0.4% MER and no loading. I'd like to have 20 to 30% of Canadian allocation in small caps and this is one case when I prefer a mutual fund to a tracker. Of course past overperformance might not extend into the future.
 
#44 · (Edited)
Interesting. Is that a special arrangement through your work? I am interested in buying this through TDDI or Scotia iTrade ... any idea how that would work? It seems that the MER would be higher, at 1.49%, and I can't figure out the story with the loads. It sounds like any time I add new money into the fund, there would be a fee taken off that (front load).

Pretty hard to ignore a fund that works in a specialized space like this, with 13.3% annual return since inception in 1995. This is significantly higher than the Canadian index. Could the fund managers really be this good? 22 year history can't be an anomaly.
 
#45 ·
Yes, it's a registered pension plan through work. Large companies set up deals with various funds and negotiate lower MERs. The selection isn't all that great but Beutel small cap was something I fancied anyway.

I can see that a good manager can add a lot of value to a Canadian small cap fund. It's a bit of a sandpit... The usual problem with mutual funds is that eventually the brains behind success leave or the fund grows too popular and large to add any alpha.
 
#48 ·
When I look at my account in TDDI it shows Beutel Goodman Small Cap as no load.

It may be worth calling them to check though. I know TDDI sells Mawer as no load, but I recall the minimum to buy was $5k and also they had a short-term redemption fee. BG funds may have something similar.
 
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