Matco Canadian Equity Income Fund (Series F)
Fund Documents [LINK]    Fund Codes [LINK]     As at June 30, 2020 

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

$68 Million

Portfolio Manager

Anil Tahiliani, MBA, CFA

Dividend Yield

4.1%

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

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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.

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      
Annualized
Net of Fees 3M YTD 1Y 3Y 5Y 7Y 10Y Incep.
Series F 14.2% -14.8% -10.1% -1.0% 1.0% 4.1% 4.6% 2.9%

Growth of $10,000 since inception

Cumulative Returns

  3M YTD 1Y 3Y 5Y 7Y 10Y Incep.
Series F 14.2% -14.8% -10.1% -3.1% 5.0% 32.4% 57.0% 42.9%

 

  • Calendar Year Returns

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

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

Sector Allocation 

Asset Mix

Top Holdings

Canadian Pacific Railway Ltd. 4.3%
Kirkland Lake Gold Ltd. 4.2%
Constellation Software Inc. 4.0%
Quebecor Inc. 3.9%
Alaris Royalty Corp. 3.9%
Labrador Iron Ore Royalty Corp. 3.8%
Metro Inc. 3.7%
Northland Power Inc. 3.6%
Canadian Imperial Bank of Commerce 3.5%
Royal Bank of Canada 3.5%
  • 4.3% - Canadian Pacific Railway Ltd.

    Offers transportation and supply chain expertise with access to eight major ports and key markets across North America.

  • 4.2% - Kirkland Lake Gold Ltd.

    A gold producer with operations in Canada and Australia that produced 974,615 ounces of gold in 2019.

  • 4.0% - Constellation Software Inc.

    Acquires, manages and builds industry specific software businesses that provide specialized solutions to address the particular needs of their customers.

  • 3.9% - Quebecor Inc.

    A telecommunication holding company that provides cable, television, telephone, internet and over-the-top video services.

  • 3.9% - Alaris Royalty Corp.

    Provides financing to private companies in the U.S. and Canada and receives royalties or distributions in return.

  • 3.8% - Labrador Iron Ore Royalty Corp.

    The company receives a royalty and per tonnage commission on all iron ore products produced, sold and shipped by Iron Ore Company of Canada.

  • 3.7% - Metro Inc.

    A leading retailer which operates 950 food stores and 650 drugstores under various banners in Ontario and Quebec.

  • 3.6% - Northland Power Inc.

    A global developer, owner and operator of solar, wind, thermal and electricity infrastructure.

  • 3.5% - Canadian Imperial Bank of Commerce

    A Canadian focused diversified financial services company.

  • 3.5% - Royal Bank of Canada

    A multi-national financial services company and the largest bank in Canada by market capitalization.

Outlook

The Fund remains well-positioned with a dividend yield of 4.1% and remains underweight to cyclical sectors. Given the sharp global stock market rally since late March and the upcoming second-quarter reporting season, we would view any potential market pullback as a buying opportunity. Headlines of a second COVID wave in the U.S., trade issues with China, and the U.S. presidential election may also be short term risks for the markets, however, they will provide a buying opportunity for long term investors. With interest rates expected to remain low for the next two to three years and the start of a new economic cycle likely in 2021, long term investors should focus on dividend-paying companies and be cautious of companies with unrealistic valuations.

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.