3 Gold-Rated Canadian Balanced Funds

Looking for the best of Canadian equity and income in one?

Andrew Willis 16 June, 2021 | 3:38AM
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Gold sunset in Canada

Canadian investors looking for a fund that blends both local stocks and bonds already know what they want out of a mutual fund. And if they’re particular about their products, they probably also want the best.

These funds are the best in the business in Canada – in fact, they’re the only three gold-rated funds that investors have to choose from. They’ve diligently steered portfolios through tough times for both equities and fixed income, while doing so at great value.

Here’s the list:

Name MQR 3-yr Returns 5-yr Returns 10-yr Returns


Pembroke Growth and Income Fund

Gold 9.76 7.55 7.40

Edgepoint Canadian Growth and Income Portfolio Series F

Gold 6.90 7.96 7.31
NBI Jarislowsky Fraser Select Balanced Fund F
Gold 7.67 6.40 6.57

Source: Morningstar Direct, as of June 8, 2021

Five-star rated Pembroke Growth and Income Fund topped the Canadian Equity Balanced category in 2020 clocking an impressive 12.51% return, all while providing the best twelve-month trailing yield of the three at 2.09% as of June 8th, 2021. It’s been able to outperform with a stock style that’s much more small-cap than its category or index, while picking companies that are only slightly more growth-oriented the rest of the pack.

The fund holds the most in Canadian equities at 65.42%, and apart from a 5% slice in the U.S. as of the end of last year. Pembroke’s 26% fixed income component is held in the three-star rated Pembroke Canadian Bond Fund.

EdgePoint is making a mark on the industry with its 2nd consecutive appearance in our series, covering different gold-rated Canadian funds. Four-star rated Edgepoint Canadian Growth and Income Portfolio F has taken more of a mid-cap approach for its stock blend, with a higher risk than the category as of May 31, 2021.

The equity allocations, however, are offset by a sizeable 8.76% allocation to cash – by far the largest of the three, as of Feb 28, 2021. On the fixed income size, around three-quarters of the allocation is in corporates with the remainder in cash and equivalents.

In terms of fees, the fund charges 0.86% for its F series MER. It has a 14-person strong investment team managing the largest AUM of the three funds on this list, at nearly $2 Bil. While the fund’s alpha took a hit in 2020, that’s on track to change as the fund’s taken off from the benchmark since the beginning of the year.

Lastly, with a five-star finish, NBI Jarislowsky Fraser Select Balanced F takes a more conservative, large growth approach. It scores lower in risk than the other funds, and lower than the entire category, as of May 31, 2021 – all while maintaining a similar stock style.

10% in international equities, 16% in the U.S. – this fund is more for Canadian investors with an international flair. The remainder of the portfolio is roughly split between Canadian equities and fixed income.

And more investors looking to get more specific with their tastes, there are some sector rotation possibilities with this fund, which could help explain the great downside capture ratio, as of May 31, 2021. It has allocations to consumer defensive and healthcare sectors that are higher than the category - which it also beats on volatility.

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Securities Mentioned in Article

Security NamePriceChange (%)Morningstar Rating
EdgePoint Cdn Growth & Income Port Sr F25.55 CAD0.05Rating
NBI Jarislowsky Fraser Select Bal F17.81 CAD0.17Rating
Pembroke Growth and Income16.29 CAD-0.28Rating

About Author

Andrew Willis

Andrew Willis  is Content Editor for Morningstar.ca. Follow him on Twitter @AndrewWillisCDN.

 

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