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SAPUTO INC. $29 (Toronto symbol SAP; Aggressive Growth Portfolio, Consumer sector; Shares outstanding: 205.8 million; Market cap: $6.0 billion; SI Rating: Average) is Canada’s largest producer of dairy products. It accounts for around 35% of Canada’s cheese production, and 25% of milk output. Major brands include Saputo, Armstrong, Stella and Dairyland. Canada supplies 60% of its total sales. The company is also one of the top five cheese producers in the United States, with roughly 5% of that market. Saputo’s U.S. businesses account for 30% of its sales. The remaining 10% of its sales come from dairy operations in the UK, Germany and Argentina. Heavy regulation limits expansion opportunities in Canada, so Saputo has focused on expanding its U.S. and international operations through acquisitions. That’s riskier than internal growth, but Saputo has a strong history of identifying operations that can benefit from its economies of scale and marketing expertise. The high Canadian dollar also makes foreign purchases more affordable....

MAPLE LEAF FOODS $13 (Toronto symbol MFI; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 127.0 million; Market cap: $1.7 billion; SI Rating: Average) owns 88% of Canada Bread Company. This investment accounts for 91% of its market value....

TORSTAR CORP. $17 (Toronto symbol TS.B; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 78.7 million; Market cap: $1.3 billion; SI Rating: Above average) gets 70% of its earnings from newspapers. This includes The Toronto Star, the biggest daily paper in Canada, and a top choice for advertisers. Torstar has expanded its Internet properties in the past few years, which helps cut its exposure to declining newspaper circulation. Torstar’s $0.74 a share dividend (4.4% yield) seems secure. The company could also unlock some of its value by spinning off its Harlequin book publishing subsidiary....

TEMPLETON EMERGING MARKETS FUND $20.55 (New York symbol EMF; CWA Fund Rating: Speculative) is a closed-end fund that invests in equities from emerging economies. The fund’s manager is Franklin Templeton. Templeton Emerging Market Fund provides broad geographic diversification. Although volatile, it provides access to fast-growing economies such as Brazil, China, India and others. The $418.1 million fund’s regional allocation is Asia (58.9%), Europe (17.2%) and Latin America (23.9%)....

NEW GERMANY FUND $15.92 (New York symbol GF; CWA Fund Rating: Speculative) is a closed-end fund that invests mostly in middle-market (small and mid-cap) German equities. The fund’s manager is Deutsche Asset Management. The $451 million fund’s 50 holdings are currently in Germany (93%) and the Netherlands (6%). The New Germany Fund’s focus on mid-tier German stocks provides investors with access to some of Germany’s fastest-growing companies. The New Germany Fund’s top holdings are K+S (chemicals), 6.9%; Fresenius (health care equipment & supplies), 5.6%; Q-Cells (solar cell manufacturing), 5.3%; European Aeronautical Defense (Dutchbased aerospace and defense), 4.7%; SGL Carbon (electrical equipment), 3.8%; GEA Group (chemicals), 3.7%; Solarworld (solar power manufacturing), 3.4%; IVG Immobilien (real estate), 3.2%; United Internet (Internet service provider), 3.1%; and Software (software), 3.0%....

KOREA FUND $24.05 (New York symbol KF; CWA Fund Rating: Speculative) is a closed-end fund that invests at least 80% of its assets in Korean equities. Currently, 99% of its assets are in South Korean stocks. The fund’s manager is RCM Asia Pacific. The fund’s top holdings are Samsung Electronics at 7.3%; Posco (steel), 7.0%; Hyundai Heavy Industries (shipbuilding), 6.6%; Shinhan Financial, 4.3%; GS Engineering and Construction, 3.4%; Shinsegae Co. Ltd. (investment and credit research), 3.3%; NHN Corporation (online media & web sites), 3.1%; Daewoo Shipbuilding & Marine, 3.1%; KT&G Corporation (cigarette maker), 3.0%; and LG Corporation (conglomerate), 2.9%. The industry exposure of the 38 stocks in the fund’s $832 million portfolio is as follows: Industrials, 37%; Financials, 16%; Information technology, 14%; Materials, 10%; Consumer staples, 6%; and Consumer discretionary, 5%....

CENTRAL EUROPE AND RUSSIA FUND $48.14 (New York symbol CEE; CWA Fund Rating: Speculative) is a closed-end fund that invests mostly in larger cap stocks from Russia and central Europe. The fund’s manager is Deutsche Asset Management International. The $880.2 million fund’s 60 holdings are currently invested in Russia (55%), Poland (17%), Turkey (11%), Czech Republic (6%), Hungary (5%), Austria (2%) and Bermuda (1%). Central Europe and Russia Fund’s top holdings are Gazprom (a Russian gas utility) at 14.9%; Lukoil (Russian oil and gas), 6.3%; Norilsk Nickel (Russian metals and mining), 5.6%; Rosneft Oil Company (Russian oil and gas), 5.0%; Powszechna Kasa Oszczednosci (Polish bank), 4.6%; Sberbank (Russian bank), 4.6%; Bank Pekao (Polish bank), 3.6%; Telekomunikacja Polska (Polish telecom), 3.6%; and Turkiye Garanti Bankasa (Turkish bank), 2.8%....

ISHARES CDN REIT SECTOR INDEX FUND $13.65 (Toronto symbol XRE; buy or sell through a broker) holds the 12 Canadian real estate investment trusts (REITs) in the S&P/TSX Capped REIT Index. The weight of any one REIT in the value of the S&P/TSX Capped REIT Index is limited to 25%. RioCan REIT makes up 25% of the index’s value; H&R REIT, 15.1%; Canadian REIT, 9.4%; Boardwalk REIT, 8.9%; Calloway REIT, 8.1%; Canadian Apartment Properties REIT, 6.0%; Primaris Retail REIT, 6.0%; Chartwell Seniors Housing REIT, 5.0%; Innvest REIT, 4.2%; Cominar REIT, 4.3%; Extendicare REIT, 4.1%; and Dundee REIT, 2.7%. We’re glad to see that the top holding is RioCan, one of our favorite REITs. In fact, three of the top six holdings are among our recommendations. Note that iShares CDN REIT holds a couple of REITs we don’t recommend....

H&R REAL ESTATE INVESTMENT TRUST $19.90 (Toronto symbol HR.UN; SI Rating: Extra risk) holds interests in 35 office properties, 125 industrial properties and 141 retail properties. Over half are in the Greater Toronto Area. The rest are elsewhere in Ontario, in Quebec, western Canada and the U.S. The company now has an industry-leading portfolio occupancy rate of 99.7%. Revenue in the three months ended December 31, 2007 was $149.5 million, up 4.6% from $142.9 million a year earlier. Cash flow per unit rose 1.0%, to $0.431 from $0.427. H&R recently increased its annual distributions by 5.1%, to $1.44 from $1.37. Its units now yield 7.2%. H&R REIT is a buy.

CANADIAN REIT $27.71 (Toronto symbol REF.UN; SI Rating: Extra Risk) owns a portfolio of more than 140 income properties consisting of retail, industrial and office properties across Canada and in the Chicago, Illinois area. Occupancy is at 96.5%. CREIT’s revenue in the three months ended December 31, 2007 was $75.8 million, up 5.6% from $71.9 million a year earlier. Cash flow per unit rose 8.2%, to $0.53 from $0.49. The units yield 4.8%. CREIT focuses on acquiring properties in prime locations, usually near major metropolitan centres, that attract strong tenants, maintain high occupancy rates and deliver a reliable stream of rental income....

RIOCAN REAL ESTATE INVESTMENT TRUST $21.43 (Toronto symbol REI.UN; SI Rating: Average) is Canada’s largest REIT. RioCan has ownership interests in a portfolio of 214 retail properties across Canada, including 14 under development. These properties contain over 55 million square feet of leasable area. Portfolio occupancy stands at 97.6%. RioCan’s revenue in the three months ended December 31, 2007 was $165.2 million, up 9.3% from $151.2 million a year earlier. Cash flow per unit rose 7.7%, to $0.42 from $0.39. RioCan’s annual distribution of $1.35 gives the units a yield of 6.3%. RioCan is still a buy.

IVY ENTERPRISE FUND $4.24 invests in small and medium-sized companies. The $160.4 million fund has an MER of 2.40%. The fund’s overall choice of stocks doesn’t inspire our confidence. Its top holdings are Richie Brothers Auctioneers, National Instruments, Resources Connection, Idexx Laboratories, Astral Media, Canadian Western Bank, Daktronics Inc., Henry Schein and Stratasys Inc. We think investors can do better by buying some of the other small-cap funds we recommend in Canadian Wealth Advisor....

IVY CANADIAN FUND $26.71 (CWA Rating: Conservative) invests in high-quality, large capitalization stocks. The $3.0 billion fund’s top holdings include Shoppers Drug Mart, TD Bank, Manulife Financial, Canadian National Railway, Becton Dickinson & Co., Enbridge, McDonald’s Corp., Thomson Corporation, Diageo plc and Walgreen Co. Ivy Canadian’s breakdown by industry is: Consumer staples, 29.3%; Financials, 17.5%; Consumer discretionary, 15.2%; Industrials, 11.7%; Health care, 6.6%; Energy, 5.6%; Information technology, 4.0%; and Utilities, 4.0%....

IVY EUROPEAN FUND $14.39 (CWA Rating: Aggressive) holds mostly good quality stocks, although it has underperformed the longer-term benchmark Morgan Stanley indexes. We don’t see any reason to hold a mutual fund that concentrates in Europe. If you want European exposure, consider Ivy Foreign Equity Fund (see above), or the closed-end EUROPEAN EQUITY FUND $11 (New York symbol EEA; CWA Fund Rating: Conservative). Ivy European Fund is a sell.

IVY FOREIGN EQUITY FUND $28.85 (CWA Rating: Conservative) outperformed the Morgan Stanley benchmark international index over the last 10 years. The fund gained 4.1%, and that was better than the Morgan Stanley benchmark’s gain of 1.7%. Ivy Foreign Equity Fund lost 11.6% over the last year. The fund invests in companies based outside of Canada, but cuts risk by avoiding direct investment in emerging markets. Ivy Foreign Equity is one of our top foreign fund recommendations. Still, we think non-U.S. international funds should make up at most 10% of the holdings of a conservative investor. The fund’s top holdings are Reckitt Benckiser plc (UK household & healthcare products), McDonald’s Corp., L’Oreal SA (French cosmetics), Becton Dickinson (U.S. medical technology), Nestle SA, Henry Schein Inc., (U.S. healthcare), PepsiCo (U.S. food & beverage), William Demant (hearing health products) and Diageo plc (UK alcoholic drinks)....

IVY GROWTH AND INCOME FUND $21.37 (CWA Rating: Conservative) (Mackenzie Financial Corp., 150 Bloor St. West, Toronto, Ont. M5S 3B5. 1-800-387-0780; Web site: www.mackenziefinancial.com. Load fund — available from brokers) is a balanced fund, holding a mixture of stocks, bonds and cash. The fund has returned 5.6% annually for the 10 years. It lost 6.6% over the last year. The fund’s MER is 2.10%. The fund’s top stock holdings are Shoppers Drug Mart, PepsiCo, Manulife Financial, Enbridge, Thomson Corp., McDonald’s Corp., Becton Dickinson (U.S. medical technology), Sun Life Financial, TD Bank, Walgreen Co. (U.S. pharmacies) and Diageo plc (UK alcoholic beverages). This $2.5 billion fund holds 24% of its assets in bonds. Interest rates on bonds are now under 5% annually in Canada. That’s the total return that a bond can provide, from today until it matures. However, bonds leave investors at the mercy of inflation, which shrinks the purchasing power of all fixed-return investments. In fact, an upsurge in inflation could wipe out all returns on bonds, and some of their principal besides....

POWER CORPORATION $34.10 (Toronto symbol POW; SI Rating: Above average) is a diversified holding company. Power Corp. controls one of Canada’s largest mutual-fund companies, IGM Financial, and Great-West Lifeco, one of the largest life insurers. Power Financial, 66.4% held, is a holding company for Power Corp.'s financial assets, including 72.9% of Great-West Lifeco and 58.4% of IGM Financial. As well, Power Financial holds 50% of Parjointco, which in turn owns a 54.3% interest in Swiss-listed Pargesa Holdings SA. Pargesa has 95% of its assets in five large European companies: Imerys (minerals processing), Total SA (world’s fourthlargest oil firm), Pernod Ricard (wine and spirits), Suez (energy, water and waste services) and Lafarge SA (cement and building materials). Power Corp. also owns 100% of Gesca Ltée, which publishes Montreal’s La Presse and six other daily newspapers. In the three months ended December 31, 2007, Power Corp.'s earnings rose 21.1%, to $350 million or $0.70 a share, from $289 million or $0.57 a share. Great-West Lifeco contributed $250 million to Power Corp.'s earnings and IGM Financial contributed $87 million....

THE DUN & BRADSTREET CORP. $83 (New York symbol DNB; Conservative Growth Portfolio, Finance sector; Shares outstanding: 56.6 million; Market cap: $4.7 billion; WSSF Rating: Average) focuses on credit reports for individual companies, not bonds or asset-backed securities, so it’s less exposed to the problems in the mortgage industry than Moody’s or Standard & Poor’s. Dun & Bradstreet’s reports cover over 125 million companies in 200 countries. Clients use its products to make lending and buying decisions. The United States accounts for around 80% of its revenue. Corporate information accounts for 60% of Dun & Bradstreet’s revenue, and the slowdown in lending activity has hurt demand for its reports. The remaining 40% of its revenue comes from products and services that help clients expand sales and improve customer loyalty....

MOODY’S CORP. $37 (New York symbol MCO; Conservative Growth Portfolio, Finance sector; Shares outstanding: 246.4 million; Market cap: $9.1 billion; WSSF Rating: Average) provides independent credit ratings and other information on bonds and other securities. The company also provides credit assessment services and software to banks and other lenders. Moody’s gets 40% of its revenue from outside the United States. Moody’s stock is down 51% from its all-time high of $76 in February 2007. The slowdown in the housing market has hurt demand for credit reports on securities backed by mortgages and other assets. These securities account for 40% of Moody’s rating business. Despite the credit market slowdown, Moody’s earnings in 2007 rose 3.1% to $677.8 million from $657.6 million in 2006. These figures exclude restructuring costs. Earnings per share rose 11.1%, to $2.50 from $2.25 on fewer shares outstanding. Revenue grew 15%, to $2.3 billion in 2007 from $2.0 billion in 2006, partly due to the fall in the U.S. dollar....

MCGRAW-HILL COMPANIES LTD. $38 (New York symbol MHP; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 320.7 million; Market cap: $12.2 billion; WSSF Rating: Average) has three main operations: financial information under the Standard & Poor’s brand (45% of sales in 2007, 75% of profit); school textbooks (40%, 22%); and the media division which includes BusinessWeek magazine and four TV stations (15%, 3%). Standard & Poor’s gets most of its income from charging fees for assigning a credit grade to bonds and other securities. Falling volumes of new bond issuances plus slowing corporate lending will likely hurt its short-term growth. However, Standard & Poor’s should gain from growing investor demand for investment-grade corporate bonds and government securities....

TOYOTA MOTOR CORP. ADRs $104 (New York symbol TM, Conservative Growth Portfolio, Manufacturing & Industry sector; ADRs outstanding: 1.8 billion; Market cap: $187.2 billion; WSSF Rating: Above average) is the world’s second-largest car maker after General Motors. Each Toyota ADR represents two of Toyota’s common shares. The company spends about 4% of its revenue on research. This spending has helped Toyota take the lead in several new automotive technologies, including the hybrid gasoline/electric engine. Thanks to surging fuel prices, demand for hybrid vehicles is rising strongly. The company is also earning money by licensing its hybrid technology to other automakers. Toyota is now working on a hybrid car that users can recharge by plugging it into a household electrical outlet. That would give the electrical motor greater range, reducing the need to use the gasoline engine for short trips....

AUTODESK INC. $33 (Nasdaq symbol ADSK; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 230.9 million; Market cap: $7.6 billion; WSSF Rating: Average) is the largest maker of design software used in construction and engineering. It has now developed what it calls its “sustainability analysis dashboard”. This lets engineers and architects measure the environmental impact of design features. The Leadership in Energy and Environmental Design (LEED) Green Building Rating System, developed by the U.S. Green Building council, provides a set of standards for environmentally sustainable construction. Autodesk’s dashboard software lets users measure how many points a specific design feature will give them towards LEED certification. In the fiscal year ended January 31, 2008, Auto Desk earned $1.88 a share before unusual items, up 22.9% from $1.53 in the prior year. Revenue rose 22.2%, to $2.2 billion from $1.8 billion. It spent a high 22% of its fiscal 2008 revenue on research....

THE BOEING CO. $76 (New York symbol BA; Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 764.8 million; Market cap: $58.1 billion; WSSF Rating: Above average) is the world’s second-largest maker of commercial aircraft, behind Europe’s Airbus. Boeing is currently developing its new 787 Dreamliner passenger jet plane, which uses lightweight materials like titanium and carbon fiber. This makes the 787 about 20% more fuel-efficient than older models. The 787 will also use energy-efficient LED lighting inside the cabin, instead of fluorescent tubes. Thanks to its low fuel requirements, demand from cost-conscious airlines for the 787 has been strong. Since its launch in April 2004, Boeing has received nearly 900 orders for the 787, worth over $150 billion....

PHILIPS ELECTRONICS N.V. ADRs $38 (New York symbol PHG; Conservative Growth Portfolio, Manufacturing & Industry sector; ADRs outstanding: 1.1 billion; Market cap: $41.8 billion; WSSF Rating: Average) operates in three main areas: consumer electronics; lighting; and medical equipment. Each American Depository Receipt represents one Philips common share. Philips is a leading maker of LED (light-emitting diode) lighting systems, which use up to 50% less electricity than regular light bulbs. LEDs also last much longer than conventional bulbs. Consequently, many cities are replacing street lamps and traffic signals with LEDs. Construction companies are also installing LED systems in new buildings. Demand for LEDs should continue to grow, as the technology improves and manufacturing costs fall. In 2007, Philips’ earnings jumped to 4.19 Euros a share from 0.76 Euros a share in 2006, mostly due to gains on the sale of assets (1 Euro = $1.54 U.S.). Sales crept up to 26.8 billion Euros from 26.7 billion Euros....

GENERAL ELECTRIC CO. $37 (New York symbol GE; Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 10.0 billion; Market cap: $370.0 billion; WSSF Rating: Above average) is one of the world’s largest industrial corporations. GE’s products include major appliances; lighting products; medical imaging equipment; power generation and delivery products; and aircraft jet engines. It also owns 80% of media company NBC Universal, which operates the NBC television network, Universal Studios and several cable and Internet properties. GE sells a wide range of environmentally friendly consumer products, including low-wattage light bulbs and energy-efficient appliances. It also supplies wind turbines and solar panels to electrical utilities. As well, its expertise with nuclear power plants should help it profit from the construction of new plants around the world. Nuclear plants generate fewer emissions than gas and coalfired plants. GE earned $2.17 a share (total $22.5 billion) in 2007, up 8.5% from $2.00 ($19.4 billion) in 2006. Revenue rose 13.8%, to $172.7 billion from $151.8 billion. Research and development spending was 2.4% of revenues. Long-term debt of $319.0 billion is a high 86% of its market cap, but won’t likely hinder GE’s ability to expand research or make acquisitions of companies with environmental technologies....