Matco Canadian Equity Income Fund (Series F)
Fund Documents [LINK]    Fund Codes [LINK]     As at June 30, 2022

Investment Profile
The Fund invests in mid to large-cap leading Canadian dividend-paying companies and is diversified across sectors. The Fund seeks to generate regular dividend income plus long-term capital appreciation.

Fund Inception Date

2007

Fund Net Asset Value

$81.1 Million

Portfolio Manager

Anil Tahiliani, MBA, CFA

Dividend Yield

4.0%

Is this fund for you?

You typically have a 5+ year investment horizon

You can tolerate medium risk on your investment

You are looking for an investment that is well diversified and pays a dividend

  START INVESTING TODAY  

 

Geographic Profile

Canadian-focused
The Fund is primarily focused on Canadian equities maintaining a minimum of 70% in Canadian securities. It may also invest from time to time in U.S. and foreign securities based upon Matco's assessment of market conditions.

Canadian Equity Geographic Profile 22Q2

Strategy

The fund invests in a focused portfolio of 30-35 highest conviction companies.

The fund focuses on companies that meet Matco’s strict investment criteria which include:

  • Quality

  • Income

  • Growth

  • Value

  • Risk

Investor Education

  • Ensure you have an investment time horizon of 5+ years

  • Understand that at times the fund’s performance may be out of sync with the market

  • The companies’ earnings growth cycle may fluctuate over time

  • Learn about Matco and our investment philosophy

  • Assess the fund’s performance over a 5-year period in order to recognize the fund’s true value

  • Understand this Fund is not intended to be a complete investment program for all investors

Performance (Series F)

As at June 30, 2022    
Annualized
Net of Fees 3M YTD 1Y 3Y 5Y 7Y 10Y Incep.
Series F -11.0% -7.4% -1.8% 5.8% 5.0% 4.8% 6.7% 4.4%

Growth of $10,000 since inception

Canadian Equity Growth of $10,000 22Q2

Cumulative Returns

    3M YTD 1Y 3Y 5Y 7Y 10Y Incep.
Series F   -11.0% -7.4% -1.8% 18.5% 27.8% 38.4% 90.8% 88.4%

 

  • Calendar Year Returns

      2021 2020 2019 2018 2017 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007
    Series F 22.8% -1.2% 18.4% -13.7% 9.4% 14.6% -2.5% 6.7% 18.1% 7.2% -7.3% 16.6% 31.1% -31.6% 2.4%
  • Rolling 5-Year Returns

      From 2016
    to 2021
    From 2015 
    to 2020
    From 2014
    to 2019
    From 2013
    to 2018
    From 2012 
    to 2017
    From 2011
    to 2016
    From 2010
    to 2015
    From 2009 
    to 2014
    From 2008 
    to 2013
    From 2007 
    to 2012
    Series F 6.3% 4.8% 4.6% 2.4% 9.0% 8.6% 4.1% 7.9% 12.4% 0.8%
  • Annual Distribution per Unit ($/unit)

      2021 2020 2019 2018 2017 2016 2015
    Income 0.22 0.02 0.59 0.40 0.34 0.28 0.29
    Capital Gains 0.08 0.30 - 0.24 - -
    Total Distributions: 0.30 0.02 0.89 0.40 0.58 0.28 0.29

Sector Allocation 

Candian Equity Sector Allocation 22Q2

Asset Mix

Canadian Equity Asset Mix 22Q2

Top Holdings

Ritchie Bros. Auctioneers Inc. 4.1%
Ats Automation Tooling Systems Inc. 4.0%
Nutrien Ltd. 3.9%
Great-West Lifeco Inc. 3.8%
Rogers Communications Inc. CLB NV 3.7%
Waste Connections Inc. 3.6%
Loblaw Companies Ltd. 3.5%
BCE Inc. 3.5%
Bank of Nova Scotia 3.5%
Toronto-Dominion Bank 3.5%
  • 4.1% - Ritchie Bros. Auctioneers Inc.

    Provides a global platform to buy and sell heavy equipment, trucks and other assets.

  • 4.0% - Ats Automation Tooling Systems Inc.

    Global provider of automation and integration solutions for various industries

  • 3.9% - Nutrien Ltd.

    A global producer of potash, nitrogen and phosphate products for the agricultural and industrial markets.

  • 3.8% - Great-West Lifeco Inc.

    Financial service company offering life and health insurance, retirement and asset management and reinsurance.

  • 3.7% - Rogers Communications Inc. CLB NV

    Provides internet, wireless, cable and security services and owns the Toronto Blue Jays and other media assets.

  • 3.6% - Waste Connections Inc.

    North America's third-largest solid waste services company serving Canada and the United States.

  • 3.5% - Loblaw Companies Ltd.

    Canada’s largest food and pharmacy leader with 2,400 stores under various banners including Loblaws, Real Canadian Superstore and Shoppers Drug Mart.

  • 3.5% - BCE Inc.

    Canada’s largest communications company and operates various media properties such as CTV, TSN, Crave and The Source retail stores.

  • 3.5% - Bank of Nova Scotia

    An international bank operating in lending, wealth management, investment banking, and capital markets.

  • 3.5% - Toronto-Dominion Bank

    A global bank operating in Canadian Retail, U.S. Retail, and an investment in The Charles Schwab Corporation; and Wholesale Banking.

Outlook

We expect the Bank of Canada to aggressively raise interest rates given its public stance against inflation. Although the central bank is in a difficult position to control inflation while not engineering a recession, we do not believe a recession will occur in 2023. Our thesis is based on recent ‘green shoots’ of falling prices for semiconductor chips, shipping container prices, and food input costs.

We expect inflation to start falling in 2023, and the pace until then will be moderate increases rather than run away as we experienced in the late 1970s/early 80s. Canadian calendar 2022 corporate earnings are expected at 28% year-over-year. However, 2023 earnings are currently estimated at 6% year over year. Thus, a recession is already well discounted by investors, given the peak to trough decline of 17% of the Canadian stock market and reduced earnings expectations heading into 2023.

The Fund continues to be positioned for a rising rate environment, with the largest sector weights being Financials, Industrials, Telecommunications, and Energy. However, investor sentiment toward equities remains negative, given daily headlines of a pending recession. For long-term investors, this is the time to take advantage of recession fear by buying high-quality dividend-paying companies with sustainable dividends.

Performance returns for the Matco Mutual Funds are calculated by Matco Financial Inc. These returns are calculated and reported in Canadian dollars and are historical simple returns for the 3 month, YTD and 1 year periods and annualized compounded total returns for periods after 1 year. They include changes in unit value and reinvestment of all distributions and do not take into account sales, redemption, distribution or optional charges or income taxes payable by any security holder that would have reduced returns. A cumulative return on an investment is the aggregate amount that the investment has gained or lost over time, independent of the amount of time involved, expressed as a percentage. Calendar year return reflects the compound rate of return over the specified calendar year (January 1st to December 31st). Matco Fund returns are calculated after management fees and operating expenses have been deducted.