TORONTO, Oct. 2, 2013 /CNW/ - The third quarter was a positive one for
mutual funds in Canada with all but one of the 22 Morningstar Canada
Fund Indices that measure the performance of equity fund categories
posting increases, according to preliminary performance numbers today
released by Morningstar Research Inc. (Morningstar Canada), a
subsidiary of independent investment research provider Morningstar,
Foreign equity funds were among the top performers. Morningstar Canada
Greater China Equity Fund Index was up 2.6% in September, and increased
9% for the best performance among regional indices for the quarter.
Also in the Asia-Pacific area, funds that invest in Japanese equities
increased 4.7% in the quarter, as measured by the Morningstar Canada
Japanese Equity Fund Index. The index led in September with a one-month
increase of 7.6% and is up 29% so far this year.
"Japanese equities have benefitted from Bank of Japan's stimulus
policies," Morningstar Fund Analyst Joanne Xiao said. "In particular,
the move to devalue the yen has helped the country's export economy."
Ranking second for quarterly performance among regional fund indices was
the Morningstar European Equity Fund Index, which increased 8.5% for
the three-month period. That result was slightly better than the 8.3%
increase posted by the more diversified funds in the International
The best results for the third quarter of 2013, however, came from
sector funds. The Health Care Equity category increased 9.9%,
underlining a continuing rally for the sector that has seen the
Morningstar Canada Health Care Equity Fund Index increase 34.2% for the
top year-to-date rank.
For funds that invest in precious metals, the rally in gold that saw a
double-digit increase by the Morningstar Canada Precious Metals Equity
Fund Index in August came to an abrupt end. Despite a three-month
increase of 9.3% and a second-place ranking for the quarter, sliding
gold prices led the index to declines of 10.9% in September and 41% for
the year to date, which were the worst performances by any Morningstar
fund index for both periods.
Meanwhile, two other sector-specific fund indices, Financial Services
and Natural Resources, posted increases of 8.3% and 8.2%, respectively,
to rank among the top 10 performers for the quarter.
With these sectors holding significant weights in the Canadian economy,
mutual funds in Canada that invest in domestic equities also posted
solid third-quarter results. The Morningstar Canadian Small/Mid Cap
Equity Fund Index was up 7.9%, while the Canadian Focused Small/Mid Cap
Equity Fund Index rose 6.8%.
Investments in larger Canadian companies were similarly positive, as the
Canadian Equity Fund Index increased 5.9%, for a slightly better
performance than the 5.8% posted by the Canadian Equity Focused Equity
In the United States, even with the deadlock on spending and the
dramatic shutdown of the government weighing on markets towards the end
of the month, U.S. stocks ended September and the third quarter in
"The Fed's surprise announcement of delayed tapering of economic
stimulus provided support to U.S. equities," Xiao said.
Among all Morningstar Canada Fund Indices, the biggest quarterly
decline—and the only negative result for an equity category—in the
third quarter of 2013 was a decline of 2.3% posted by the Morningstar
Canada Real Estate Equity Fund Index.
For more about September 2013 fund performance, go to www.morningstar.ca.
Morningstar Canada's preliminary fund performance figures are based on
change in funds' net asset values per share during the month, and do
not necessarily include end-of-month income distributions. Final
performance figures will be published on www.morningstar.ca next week.
About Morningstar Research Inc. and Morningstar, Inc.
Morningstar Research Inc. is a Canadian subsidiary of Chicago-based
Morningstar, Inc., a leading provider of independent investment
research in North America, Europe, Australia, and Asia. The company
offers an extensive line of products for individuals, financial
advisors, and institutions. Morningstar provides data on approximately
433,000 investment offerings, including stocks, mutual funds, and
similar vehicles, along with real-time global data on more than 10
million equities, indexes, futures, options, commodities, and precious
metals, in addition to foreign exchange and Treasury markets.
Morningstar also offers investment management services through its
registered investment advisor subsidiaries and has approximately US$166
billion in assets under advisement or management as of June 30, 2013.
The company has operations in 27 countries.
©2013 Morningstar, Inc. All rights reserved.
SOURCE: Morningstar Research Inc.
For further information:
Joanne Xiao, Fund Analyst, Morningstar Canada, +1 416-484-7004 or firstname.lastname@example.org
Rudy Luukko, Editor, Investment and Personal Finance, Morningstar Canada, +1 416-484-7825 or email@example.com