Welcome to CanadianHedgeWatch.com
Sunday, June 23, 2024

Mackenzie launches two new currency-hedged classes of US funds

Date: Tuesday, March 7, 2006
Author: Mon

TORONTO, Mar 7, 2006 (Canada NewsWire via COMTEX) --

Mackenzie Investments has created new currency- hedged versions of Mackenzie Universal American Growth Capital Class and Mackenzie Universal U.S. Growth Leaders Capital Class funds. Canadians now have the option of investing in these US equity funds without concern as to how currency fluctuations between the Canadian and US dollar might affect their returns.

"Canadian investors have watched our dollar rise strongly against the US currency over the past few years. If they've been invested in unhedged US equities, they may have received a diminished return even if the stocks have gone up," said David Feather, President, Mackenzie Financial Services Inc. "These new currency-hedged funds give investors greater choice and the ability to participate in the growth of US equity markets while maintaining control over their exposure to the US dollar."

How the funds work:

Within each of these Capital Class funds, Canadians will have the option of investing in two "classes" of shares - the new hedged and original unhedged versions. Each class will be identifiable by its name; e.g. Mackenzie Universal American Growth Capital Class will be comprised of Mackenzie Universal American Growth Capital Class (Hedged Class) and Mackenzie Universal American Growth Capital Class (Unhedged Class). Copyright (C) 2006 CNW Group.

The funds' investment portfolios will continue to be managed in the same manner and by the same portfolio managers at Bluewater Investment Management and Waddell & Reed. The one exception is that returns generated from the hedged classes of shares will represent the performance of the fund's portfolio holdings plus the performance of a currency hedge.

Mackenzie manages the hedging program for these funds and makes adjustments to the hedges based on cash flows into and out of the funds and movements in the funds' portfolio holdings. While each of these funds will use derivatives to hedge the foreign currency exposure of the Hedged Class, there will be circumstances, from time to time, where the level of hedging does not fully cover the Hedged Class foreign exposure.

Flexibility around hedging

Investors may choose to hedge any or all of their investment, from 100% to a 50/50 split, or any percentage split of their choice. In addition, investors may switch between the two classes without triggering a taxable event.

"Canadians' decisions to hedge or not depends on their risk tolerance and time horizon," adds Feather. "If you are investing for the long term or your portfolio is well diversified, currency hedging may not be necessary. If it's the opposite scenario, you may want to hedge. These new versions of Mackenzie Universal funds provide flexibility so that investors may, in consultation with their financial advisor, choose the hedge that is right for them."

About Mackenzie

Mackenzie Investments was founded in 1967, and is a leading investment management firm providing investment advisory and related services. With $51 billion in assets under management, Mackenzie distributes its services through a diversified network of third party financial advisors. Mackenzie Investments is a member of the IGM Financial Inc. (TSX: IGM) group of companies. IGM Financial is one of Canada's premier financial services companies with over $103 billion in total assets under management.

SOURCE: Mackenzie Financial Corporation

SOURCE: IGM Financial Inc.

Catharine Marion, Environics Communications Inc., (416) 969-2809, cmarion@environicspr.com