Fiera Capital foreign equity funds added to Core platform and transition of UBS foreign equity funds

January 13, 2014

Plan sponsors may wish to consider whether this investment news has any implications for the investment options available within their plans. Sun Life Assurance Company of Canada purchases units of the funds listed below, which are established as segregated funds in accordance with the Insurance Companies Act (Canada).

We're pleased to announce the addition of three new funds to our Core investment platform which enhance the breadth and depth of investment options available to Defined Contribution plan sponsors and their members.

The following three segregated funds are available effective immediately:

  • Fiera U.S. Equity
  • Fiera Global Equity
  • Fiera International Equity

Fiera follows an active, bottom-up and research intensive investment approach. They are long-term investors focused on identifying high quality, well-run businesses. In building portfolios, Fiera seeks best of breed companies with superior growth potential at an attractive price.

Their portfolios are made up of high conviction holdings and have an emphasis on stock selection rather than sector allocation. The three foreign equity funds aim to achieve long-term outperformance over the respective benchmarks and disciplined risk management.

Fiera's foreign equity team is led by Nadim Rizk, Vice President and Senior Portfolio Manager with 19 years of investment industry experience. The team is supported by six investment professionals whose research responsibilities are split by industry sector and by the: CIO office, equity strategies and the trading team.

Transition of UBS foreign equity funds to Fiera Capital
Fiera Capital recently announced that it would be transitioning the three UBS foreign equity funds to Fiera on March 12, 2014. The performance history of the UBS funds will be changed to show the Fiera track record after March 2014, and the funds' names will also be changed as a result of the UBS fund closure and transition to Fiera.

Plan sponsors with holdings in these funds will automatically have their assets transitioned to Fiera Capital funds as follows:
 

Current fund New fund effective March 12, 2014
UBS American Equity Segregated Fund Fiera U.S. Equity Segregated Fund
UBS Global Equity fund Segregated Fund Fiera Global Equity Segregated Fund
UBS International Equity Segregated Fund Fiera International Equity Segregated Fund


How this affects you and your members?
The UBS funds will be closed and mapped to the Fiera funds in March. This is a taxable event for non-registered assets.

About Fiera Capital
Fiera is a leading publicly traded, independent investment firm with over $76 billion in assets under management. With offices in major cities across Canada and in the U.S., the Firm is one of only a handful of full service, multi-product investment firms in Canada, providing extensive expertise in Canadian active and structured fixed income, Canadian and foreign equity, asset allocation and non-traditional investment solutions through a broad range of strategies and services.

The tables below outline the key changes in investment policies between UBS and Fiera strategies.

Summary of the Funds Investment Policy changes:

General

Fiera U.S .Equity

UBS American Equity

Objective Seeks to generate a total return of 1.5% higher than the S&P 500 (CAD) over four-year moving periods. Outperform the S&P 500 Index over a full market cycle while controlling risk.
Number of stocks 25-40 60-90
Portfolio Turnover Low (10-25%) Moderate (30-40% )
Style

Fundamental

Large Cap GARP with quality bias

Fundamental

Bottom-up, Core

Average Market Cap $67.0 billion $80.0 billion
Distribution    
Sector allocation

+/- 20% sector deviations

7 of 10 GICS sectors

+/- 12.5% sector deviations
Country allocation U.S. Equity Universe U.S. Equity Universe

 

General

Fiera International Equity

UBS International Equity

Objective
  • Provide total long term returns through capital appreciation and distribution income by investing in a well-diversified portfolio of global companies, generally excluding North America.
  • Seeks to generate a total return of 2% higher than the MSCI EAFE Index, on an annualized basis, cap-weighted, with net dividends reinvested over four-year moving periods.
Exceed the return of the MSCI EAFE Index over moving four-year periods by investing primarily in non-North American stocks.
Number of stocks 30-50 60-90
Portfolio Turnover Low (10-25%) Moderate (30-40% )
Style Fundamental
Large Cap GARP with quality bias
Fundamental
Bottom-up, Core
Average Market Cap $66.8 billion $80.8 billion
Distribution    
Sector allocation +/- 20% sector deviations 7 of 10 GICS sectors +/- 5% sector deviations
Country allocation +/- 20% country deviations maximum 20% in Emerging Markets +/- 15% regional market weights

 

General

Fiera Global Equity

UBS Global Equity

Objective
  • Provide total long term returns through capital appreciation and distribution income.
  • Generate a total return of 1.75% higher than the MSCI World, on an annualized basis, cap-weighted, with net dividends reinvested, over four-year moving periods.
Exceed the return of the MSCI ACWI over moving four year periods
Number of stocks 40-60 60-90
Portfolio Turnover Low (10-25%) Moderate (30-40% )
Style Fundamental
Large Cap GARP with quality bias
Fundamental
Bottom-up, Core
Average Market Cap $66.0 billion $80.8 billion
Distribution    
Sector allocation +/- 20% sector deviations 7 of 10 GICS sectors +/- 5% sector deviations
Country allocation +/- 20% country deviations maximum 15% in Emerging Markets +/- 15% regional market weights


Fiera's Investment Policy Statement (IPS) outlines the investment and performance objectives for the investment funds managed by Fiera. A copy of the revised IPS is available on the Sun Life Financial Plan Sponsor Services website at www.sunlife.ca/sponsor.

FIERA'S PERFORMANCE HISTORY:

Performance as at September 30, 2013 - Fiera Global Equities

Annual Calendar Year Returns - December 31st (%)
  2012 2011 2010 2009
Global Equity composite* 17.80 5.63 13.41 ---
MSCI World ($CA) 13.26 -3.20 5.93  
Added Value 4.54 8.83 7.48  

 

Annualized Returns as at September 30, 2013 (%)
  2013 YTD 1 yr 2 yrs 3 yrs 4yrs Since inception1
Global Equity composite* 23.38 31.47 24.14 18.05 16.35 16.35
MSCI World ($CA) 21.09 25.58 20.08 11.90 9.35 9.35

Added Value

2.29 5.89 4.06 4.07 7.00 7.00

* Returns gross of management fees for a collection of accounts with similar investment mandates
1 Inception date: October 1, 2009
YTD: September 30, 2013 

Performance as at September 30, 2013 - Fiera International Equities

Annual Calendar Year Returns - December 31st (%)

 

2012

2011

2010

2009

International Equity composite*

24.12

-2.12

12.49

---

MSCI EAFE ($CA)

14.72

-9.97

2.13

 

Added Value

9.40

7.85

10.37

 

 

Annualized Returns as at September 30, 2013 (%)

 

2013 YTD

1 yr

2 yrs

3 yrs

Since inception1

International Equity composite*

17.00

27.72

22.21

13.90

13.34

MSCI EAFE ($CA)

19.90

29.30

17.85

8.54

6.46

Added Value

-2.90

-1.58

4.36

5.35

6.88

* Returns gross of management fees for a collection of accounts with similar investment mandates
1 Inception date: January 1, 2010
YTD: September 30, 2013

Performance as at September 30, 2013 - Fiera U.S. Equities

Annual Calendar Year Returns - December 31st (%)

 

2012

2011

2010

2009

U.S. Equity composite*

13.37

8.87

11.64

---

S&P 500 ($CA)

13.43

4.64

9.06

 

Added Value

-0.06

4.23

2.58

 

 

Annualized Returns as at September 30, 2013 (%)

 

2013 YTD

1 yr

2 yrs

3 yrs

4 yrs

Since inception1

U.S. Equity composite*

29.01

33.81

26.08

19.79

17.27

18.76

S&P 500 ($CA)

23.67

24.67

23.81

16.34

13.48

15.23

Added Value

5.34

9.14

2.28

3.44

3.80

3.53

* Returns gross of management fees for a collection of accounts with similar investment mandates
1 Inception date: April 1, 2009
YTD: September 30, 2013 


We continue to closely monitor developments related to the Fiera - UBS transaction and will provide updates as new information becomes available.

Questions?
Please contact your Sun Life Financial Group Retirement Services representative.