Truly a World-Class Fund

04/25/2012 8:45 am EST


There’s no one place for growth any longer, so it pays to diversify across world markets and few funds do it better than this one, says David West of Money Reporter.

At the Money Reporter, we take a portfolio approach to your investments, covering all asset classes: cash, fixed-income securities, income trusts, and Canadian, US, and international equities.

We rely on mutual funds especially to cover your international exposure. In our view, the complexities of currencies, foreign accounting systems, and disclosure standards, which can greatly complicate the fundamental analysis of foreign securities, make it well worth paying a reasonable management expense ratio to have someone else do that for you.

Europe is expected to emerge from its long recession by the end of this year, according to a recent Bank of Canada forecast. That’s as good a reminder as any that you might want to beef up your international exposure—especially if you don’t have any at all. One way to do that is simply by buying some units in the Mawer World Investment Fund. Here are some of the key details of this fund.

The Mawer World Investment Fund Class A (MAW102) has a track record dating back to November 1987. It’s been managed by David Ragan since November 2007, and assisted by Jim Hall since March of 2010, on behalf of Mawer Investment Management of Calgary.

The objective of this fund is to invest for diversification and capital returns. It’s truly an international, rather than a global fund, as it exclusively invests in equities traded outside of North America: Europe, Latin America, and the Pacific Basin.

The strategy the fund follows is to use a bottom-up approach, and it pursues its objective by seeking to select good companies exhibiting attractive valuation and investment characteristics. The fund’s asset allocation, therefore, is influenced more by relative valuations where they can be found, taking into account the need for diversification, rather than by simply allocating a set amount to each country.

In terms of nuts and bolts, this is a no-load fund, it is RRSP eligible (for Canadians), and it has a very reasonable expense ratio—great for an actively managed international fund—of 1.57%.

The Mawer World Investment Fund has some $318 million in assets under administration. This money is currently allocated 67.9% in the European Union, 7.6% in the Asia/Pacific Rim, and 4.6% in Japan, plus 5.4% in Canada (in treasury bills), and 4.2% Africa and the Middle East, with 10% invested elsewhere.

Major holdings include Vodafone Group (VOD), Royal Dutch Shell (RDS.A), GlaxoSmithKline PLC (GSK), and some less recognizable names such as Fuchs Petrolub AG (FPE). Diversification is good, with 18.3% in financials, 14.8% in consumer goods, 13.1% in industrial goods, and 11.2% in technology as well as 10.9% in health care.

If you need to beef up the international side of your portfolio, this fund is a great candidate.

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