manulife financial

GREAT-WEST LIFECO INC. $35 (Toronto symbol GWO; Conservative Growth and Income Portfolios, Finance sector; Shares outstanding: 996.9 million; Market cap: $35.0 billion; Priceto- sales ratio: 1.0; Dividend Yield: 3.7%; TSINetwork Rating: Above Average; www.greatwestlifeco.com) is Canada’s second-largest insurance company, after Manulife Financial (Toronto symbol MFC). It also offers mutual funds, retirement planning and wealth management. Power Financial (Toronto symbol PWF) owns 67.1% of Great-West. As of June 30, 2015, the company had $1.15 trillion of assets under administration, up 7.9% from $1.06 trillion at the end of 2014. Diversified operations cut risk...

MANULIFE FINANCIAL $22.70 (Toronto symbol MFC; Shares outstanding: 2.0 billion; Market cap: $45.4 billion; TSINetwork Rating: Above Average; Dividend yield: 3.0%; www.manulife.ca) sells life and other forms of insurance, as well as mutual funds and investment management services.

In the three months ended March 31, 2015, Manulife’s earnings per share gained 5.4%, to $0.39 from $0.37 a year earlier. Revenue rose 25.1%, to $7.83 billion from $6.26 billion.

The company continues to expand in growing Asian markets. Right now, about 40% of its insurance premiums come from that region, which is adding to its revenue and profits.

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ISHARES MSCI CANADA INDEX FUND $25.90 (New York symbol EWC; buy or sell through brokers; ca.ishares.com) holds the stocks in the Morgan Stanley Capital International Canada Index. The fund has a 0.48% MER and yields 1.6%.

The index’s top holdings are Royal Bank, 7.2%; TD Bank, 6.4%; Valeant Pharmaceuticals, 6.0%; Bank of Nova Scotia, 5.1%; CN Railway, 3.9%; Suncor Energy, 3.3%; Enbridge, 3.3%; Bank of Montreal, 3.1%; and Manulife Financial, 3.0%.

If you want to own a Canadian index fund, you should buy the iShares S&P/TSX 60 Index Fund (see previous page). You’ll pay about a third of the management fees.

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ISHARES S&P/TSX 60 INDEX ETF $21.18 (Toronto symbol XIU; buy or sell through brokers; ca.ishares.com) is a good low-fee way to buy the top stocks on the TSX. The units are made up of stocks that represent the S&P/TSX 60 Index, which consists of the 60 largest, most heavily traded stocks on the exchange. Expenses are just 0.18% of assets, and it yields 3.0%.

The index mostly consists of high-quality companies. However, it must ensure that all sectors are represented, so it holds a few we wouldn’t include. The index’s top holdings are Royal Bank, 7.9%; TD Bank, 7.1%; Valeant Pharmaceuticals, 6.6%; Bank of Nova Scotia, 5.6%; CN Railway, 4.2%; Suncor Energy, 3.6%; Enbridge, 3.6%; Bank of Montreal, 3.4%; BCE, 3.3%; Manulife Financial, 3.3%; Brookfield Asset Management, 2.8%; and Canadian Natural Resources, 2.6%.

iShares S&P/TSX 60 Index ETF is a buy.
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Two of Canada’s biggest insurance firms have the assets to forge ahead with expansion and still rank among our best low risk investments.

Exchange traded funds (ETFs) are set up to mirror the performance of a stock market index or sub-index. They hold a more or less fixed selection of securities that represent the holdings that go into the calculation of the index or sub-index. ETFs trade on stock exchanges, just like stocks. That’s different from mutual funds, which you can only buy at the end of the day at a price that reflects the fund’s value at the close of trading. Prices of ETFs are quoted in newspaper stock tables and online. You pay brokerage commissions to buy and sell them, but their low management fees give them a cost advantage over most mutual funds....

SUN LIFE FINANCIAL $41.43 (Toronto symbol SLF; Shares outstanding: 612.1 million; Market cap: $25.6 billion; TSINetwork Rating: Above Average; Dividend yield: 3.7%; www.sunlife.ca) sells life insurance, savings, retirement and pension products to individuals and corporations. It has $812.6 billion of assets under management and mainly operates in Canada, the U.S. and the U.K. It’s also expanding in Asia. In the three months ended March 31, 2015, Sun Life’s revenue rose 2.2%, to $3.72 billion from $3.64 billion a year earlier. Earnings per share gained 16.7%, to $0.84 from $0.72. The company continues to expand its asset management business, which generates high profit margins and requires little capital investment. It recently paid $560 million for Bentall Kennedy Group, which manages more than $27 billion in real estate for over 550 institutional clients across the U.S. and Canada....

MANULIFE FINANCIAL $22.18 (Toronto symbol MFC; Shares outstanding: 2.0 billion; Market cap: $43.7 billion; TSINetwork Rating: Above Average; Dividend yield: 2.8%; www.manulife.ca) now gets about a third of its insurance premiums from Asia—but that’s about to rise sharply.

The company has just entered into a 15-year “bancassurance” partnership with Singapore-based banker DBS Group Holdings. The deal will let Manulife sell life and health insurance through DBS’s Asian branch network.

Manulife won the deal over a group of companies that included Aviva plc, Prudential and AIA Group. It will pay DBS $1.2 billion to replace Aviva in its branches.

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Meta Description: Exchange-traded funds (ETFs) give investors a low-fee way to match market indexes, and these two ETFs are the cream of the Canadian crop.

MANULIFE FINANCIAL $22.18 (Toronto symbol MFC; Shares outstanding: 2.0 billion; Market cap: $43.7 billion; TSINetwork Rating: Above Average; Dividend yield: 2.8%; www.manulife.ca) now gets about a third of its insurance premiums from Asia—but that’s about to rise sharply. The company has just entered into a 15-year “bancassurance” partnership with Singapore-based banker DBS Group Holdings. The deal will let Manulife sell life and health insurance through DBS’s Asian branch network. Manulife won the deal over a group of companies that included Aviva plc, Prudential and AIA Group. It will pay DBS $1.2 billion to replace Aviva in its branches....