The Fundata FundGrade A+ Awards Presentations were held in Toronto on January 21. A total of 225 funds were presented with A+ Awards for 2014. The complete list of A+ Award winners can be found on Fund Library. In this article, we’ll take a closer look at Empire Life Emblem Conservative Portfolio, which achieved the A+ Award in its first year of eligibility for the award.
Empire Life Emblem Conservative Portfolio
Empire Life Emblem Conservative Portfoliois another first-time winner of the Fundata FundGrade A+ Award and managed to accomplish the feat in its first year of eligibility. The fund debuted in January 2012 along with five other Emblem Portfolios. These products are designed to allow investors to choose the portfolio with an asset mix that matches their desired risk tolerance. The portfolios offer instant diversification and professional rebalancing all in a single product. The portfolios range from the lower risk Diversified Income to the higher risk Aggressive Growth.
The Emblem Conservative Portfolio falls on the lower-risk side of the spectrum. This Canadian Fixed Income Balanced fund has a long-term strategic asset allocation of 65 per cent fixed income and 35 per cent equity. The equity component is targeted at 25 per cent Canadian, 5 per cent U.S. and 5 per cent International. The Empire Life Management Team tactically manages the portfolios, so the targeted mix can vary at any given time.
As of Empire Life’s Emblem Portfolios last target asset allocation update in December, the targeted mix for the Conservative Portfolio was underweight fixed income at 58 per cent (target is 65 per cent), underweight Canadian equities at 21.4 per cent (target 25 per cent), underweight international equities at 2.7 per cent(target is 5 per cent), and overweight U.S. equities at 12.8 per cent (target is 5 per cent).
To achieve these targets, the Emblem Portfolios invest directly rather than in underlying funds. The fixed-income portion is made up of a good mix Canadian corporate bonds as well as Canadian federal and provincial bonds. Top equity holdings include Royal Bank of Canada (TSX: RY), Toronto-Dominion Bank (TSX: TD), and Bank of Nova Scotia (TSX: BNS). Financials make up almost 28 per cent of the equity portion while Energy accounts for 15 per cent.
In its short history, Emblem Conservative Portfolio has one of the best 2-year compound returns in the category at 8.22 per cent. The average for the Canadian Fixed Income Balanced category is 5.76 per cent. In terms of volatility, the 2-year annualized standard deviation of 3.1 per cent is in line with the group average. On a risk-adjusted basis, this fund scores in the top five of a category that consists of close to 200 funds.
Empire Life Emblem Conservative Portfolio Series A has an MER of 2.04 per cent, and the portfolio is available in a variety of load options. The minimum investment is $2,500, and the risk rating is low to medium.
— Courtesy Fundata Canada Inc. © 2015. Brian Bridger, CFA, FRM, is Director, Analytics & Dataand Reid Bakeris Manager, Analytics & Data at Fundata Canada Inc.This article is not intended as personalized investment advice. Investments mentioned are not guaranteed, involve risk of loss, and are subject to commissions.
