Builders Fund

September 30, 2021

Fund Overview

  • The Builders Fund is a fund-of-funds that invests mainly in Steadyhand’s four stand-alone equity funds — Steadyhand Equity Fund, Steadyhand Global Equity Fund, Steadyhand Small-Cap Equity Fund, and Steadyhand Global Small-Cap Equity Fund. Its an all-stock portfolio designed for growth-oriented investors.
  • The underlying fund mix is managed by Salman Ahmed, with Tom Bradley as co-manager, and is a reflection of their views on market valuations.

Portfolio Specifics

  • The fund has benefited from strong markets so far in 2021. It was up 1.3% in the third quarter and has gained 9.2% year-to-date. While the portfolio has done well over the last 12 months, it has failed to keep up with the indexes this year as its two largest holdings (the Global Equity Fund and Equity Fund) have lagged.
  • Investments are allocated roughly 1/3 towards companies based in Canada and 2/3 towards foreign businesses. The bias to foreign companies reflects a much broader opportunity set outside of Canada, particularly in important industries like healthcare, technology, and consumer products and services.
  • In keeping with Builders’ growth objective, it holds 15% of its assets in each of our two small-cap funds (30% in total). These two funds have been our best performers in 2021. While smaller companies can experience more pronounced short-term fluctuations, they have proven to provide superior returns in the long run.
  • The fund is more evenly balanced across industry sectors than most Canadian portfolios. The largest sector weight, industrial goods & services (29% of the fund), includes a diverse mix of companies such as Raytheon (aerospace and defense systems), CN Rail, Safran (jet engines), and Ritchie Brothers Auctioneers (heavy equipment auctioneer).
  • Financial services (20%) is another important sector. The largest holdings are Visa, TD Bank, BrightSphere Investment Group (asset management), and Alleghany (property and casualty insurance).
  • Healthcare stocks make up 12% of the portfolio and also represent a diverse mix of businesses including Danaher (diagnostic tools and medical equipment), Bayer (pharmaceuticals and life sciences), Grifols (plasma-based products and pharmaceuticals) and Amplifon (hearing aids).
  • The portfolio has some exposure to commodity-related stocks, including Franco-Nevada (gold), Nutrien (fertilizers), and Schlumberger (oilfield services), but resource companies are not a prominent feature of the fund due to their inherent cyclicality.

Positioning

  • Refer to the underlying funds for details on their positioning.

Commissions, trailing commissions, management fees and expenses all may be associated with mutual fund investments. Important information about the Steadyhand funds is contained in our Simplified Prospectus. Please read the prospectus before investing. Mutual funds are not guaranteed, their values change frequently, and past performance may not be repeated.