Funds struggled back in final days of November

Mutual fund investors who stuck it out to the end of November were rewarded with a late-month rally, boosting returns on several equity fund indexes, according to data from Morningstar Canada.

Despite nearly a month of doom and gloom, seven of Morningstar’s 22 equity based fund index managed to turn in a positive result, while most of the rest lost less than 1%.

The strongest category made most of its gains off the tumultuous first three weeks of the month, as investors flocked into anything smelling like safety. The Canadian Long Term Fixed Income index gained 2.3%, while the Canadian Inflation-Protected Fixed Income index gained 1.3%.

The dominant trend of seeking safety helped boost the Precious Metals Equity index to a 0.7% gain, while the Real Estate Equity fund index earned 1.2%.

By November 27, the Morningstar Canadian Equity Fund Index was heading for a loss of 6.3%. But the final three days of the month saw the S&P/TSX Composite gain 6.5%, boosting the aforementioned index to a loss of just 0.5%.

There was a similar rally south of the border. The U.S. Equity fund index was headed for a loss of 4.2% by November 27, but in the final three days the index scratched its way back to a 1.1%. The S&P500 was up 4.5% in Canadian dollar terms, and would have performed even better had the loonie not gained against the U.S. dollar at the same time.

North American Equity funds gained 0.4% as a group.

The worst performing fund categories for the month were largely foreign focused, with the Greater China Equity index losing 4.2%, the Financial Services Equity group falling 3.6%, Emerging Markets Equity down 2.1% and European Equity funds off 1.8%.

Staff

The staff of Advisor.ca have been covering news for financial advisors since 1998.