Investors Dividend's long-time manager retires

Achilleas Taxildaris 17 July, 2014 | 4:01AM
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After more than 35 years with Investors Group and 11 years as lead manager of the $17-billion Investors Dividend, Dom Grestoni retired at the end of June 2014. The move was not unexpected, as he had gradually reduced his responsibilities in the past year. Martin Downie will take over, as he did on other funds that Grestoni gave up. Morningstar analysts have placed Investors Dividend's Analyst Rating under review until we have a chance to meet with Downie and discuss our concerns regarding the fund's positioning and its related risks.

Through his long tenure, Grestoni had a mixed track record marked by spikes in volatility. His value-oriented, low-turnover, high-concentration approach led to significant swings in performance, and his funds often ranked either in the top or bottom quartile among its peers. Downie shares some aspects of his predecessor's investment philosophy, mainly looking at well-managed, established corporations that are attractively priced. He does, however, take a less risky approach. In his first year after taking over Investors Canadian Large Cap Value, he reduced that fund's concentration in the top holdings and increased the sector diversification.

It remains to be seen how Downie will manage to steer the second largest mutual fund in Canada in the limited universe of dividend-paying Canadian blue-chips.

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Achilleas Taxildaris

Achilleas Taxildaris  Achilleas Taxildaris is analyst for Manager Research and focuses on active strategies.

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