Download Mackenzie Investments

Mackenzie
Global Large Cap Quality Growth
PERFORMANCE SUMMARY
•For Q4 2012, Mackenzie Global Large Cap Quality Growth1 returned 4.0%. This compares with the MSCI World Index2 return of 3.6%
CONTRIBUTORS TO PERFORMANCE
•On a regional basis, the mandate’s relative performance benefited from stock selection in North America, specifically in the United States
•On a sector basis, the mandate’s relative performance benefited from security selection in consumer staples and health care, as well as from stock
selection and an underweight position in information technology companies
•Despite underperforming on a relative basis, the mandate’s financials holdings contributed strongly to absolute performance
•Top individual contributors included: Admiral Group, Colruyt and Sonova Holding
DETRACTORS FROM PERFORMANCE
•On a regional basis, stock selection in Europe and a lack of exposure to the Asia Pacific detracted from relative performance over the period.
Specifically, security selection in the United Kingdom, France and Sweden detracted from the mandate’s performance
•On a sector basis, underperformance of the mandate’s consumer discretionary and industrials holdings as well as the mandate’s underweight
position in financials detracted from relative performance
•Top individual detractors included: William Morrison Supermarkets, Paychex and Donaldson
PORTFOLIO ACTIVITY
•During the quarter, the mandate’s position in Staples was liquidated over structural concerns with the business
•Staples’ key traffic driving categories are in structural decline and the portfolio management team doesn’t have confidence that Staples has a
strong enough customer proposition to be a destination in more sustainable areas like technology solutions and mobile communications
•The team’s view is that the sustainable earnings level could be significantly below the current level of earnings. They like elements of the business,
and, admire the management team and the corporate culture, but the risk/return function left them more comfortable exiting the position. They
will continue to monitor the name
OUTLOOK
•From a macro perspective a key concern for many people is that the world is awash in debt and many see this as being a significant threat to
future economic stability. And while this is undoubtedly a cause for concern, the portfolio management team believes that the real issue is what
led to the debt accumulation in the first place.
•In their view, the main culprit behind the world’s current state of affairs is decades of moral hazard and the related roles of short-term bailout
mentality and central banks disrupting the efficient functioning of capital markets.
•In terms of central banks, while their actions have been well-intended, the influences of politics, Wall Street and reputation have resulted in policy
that has become increasingly short-term focused and, until this changes, simply dealing with the debt will not prove a long-term solution.
•Only by helping to create an environment of accountability and rules that can be relied upon can central banks contribute to the underlying
fundamentals of an economy. With strong fundamentals, GDP will grow; but it will do so at a pace dictated by those fundamentals. It’s the health
of the economy – not the level of economic growth – that should be the focus of central banks.
•If central bank decisions are based on attempting to improve economic fundamentals rather than driving the stock market higher through bailouts
and if the influences of politics, Wall Street and reputation are minimized, then the team believes the multi-year path to recovery can begin.
C O M M E N TA R Y
Q4 | 2012
DECEMBER 2012
Mackenzie Global Large Cap Quality Growth
ALL DATA AS AT DECEMBER 31, 2012
PORTFOLIO MANAGEMENT TEAM:
Paul Musson, CFA Portfolio Manager; Industry experience: 18 years; Firm experience: 12 years
Matt Moody, MBA, CFA Portfolio Manager; Industry experience: 11 years; Firm experience: 7 years
Robert McKee, MSc., MBA, CFA Associate Portfolio Manager; Industry experience: 8 years; Firm experience: 1 year
Mohammed Loubani, MD, CIM Investment Analyst; Industry experience: 5 years; Firm experience: <1 year
Chris Blumas, MBA, CFA, CIM Associate Portfolio Manager; Industry experience: 11 years; Firm experience: 3 years
Richard Walke, P.Eng, MBA Investment Analyst; Industry experience: 3 years; Firm experience: 1 year
PERFORMANCE
1 Year
2 Years
3 Years
4 Years
5 Years
10 Years
Mackenzie Global Large Cap Quality Growth
10.6%
8.2%
7.5%
7.7%
5.2%
5.3%
MSCI World Index
13.0%
4.5%
5.0%
6.7%
-1.2%
2.6%
12927
2
© Mackenzie Financial Corporation 2013. All rights reserved.
The performance of the Mackenzie Global Large Cap Quality Growth mandate is represented by the gross returns of the Series A units of Mackenzie
Ivy Foreign Equity Fund for the period. The performance of the MSCI World Index reflects the gross returns of the index for the period indicated, net of
withholding taxes.
“Mackenzie Institutional” is a trademark of Mackenzie Financial Corporation (“Mackenzie”) and is used to identify Mackenzie’s institutional investment
management and institutional client relationship activities. The contents of this document do not constitute specific advice regarding your investment
situation or provide specific advice about investment, insurance, financial, legal, accounting, tax or similar matters. Certain information contained in
this document is obtained from third parties. Mackenzie believes such information to be accurate and reliable as at the date hereof, however, we cannot
guarantee that it is accurate or complete or current at all times. The information provided is subject to change without notice and Mackenzie cannot
be held liable for any loss arising from any use of or reliance on the information contained in this document. No portion of this communication may be
reproduced or distributed to anyone without the express permission of Mackenzie.
Gary Wing Executive Vice President
180 Queen Street West, Toronto, Ontario M5V 3K1
T 416 967-2080 F 416 922-3435
E [email protected]
mackenzieinstitutional.com
1/13
1