thomson reuters

IVY GROWTH AND INCOME FUND $17.86 (CWA Rating: Conservative) (Mackenzie Financial Corp., 150 Bloor Street West, Toronto, Ontario M5S 3B5. 1-800-387-0780; Web site: www.mackenziefinancial.com. Load fund — available from brokers) is a balanced fund. As such, it holds a mix of stocks, bonds and cash. Ivy Growth and Income Fund has returned 2.9% annually for the 10 years ended April 30, 2009. Over the last year, the fund lost 16.6%. Its MER is 2.08%. The fund’s top stock holdings are: Thomson Reuters Corp., Shoppers Drug Mart, Imperial Oil, Tim Hortons, Bank of Nova Scotia, Becton Dickinson, Colgate-Palmolive, McDonald’s Corporation, Nestle SA and Reckitt Benckiser Group plc. The $1.8-billion Ivy Growth and Income Fund holds 25% of its assets in bonds. In Canada, interest rates on bonds are between 2% and 4% annually. That’s the total return that a bond can provide from today until the day 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, as well as some of their principal....

IVY CANADIAN FUND $20.80 (CWA Rating: Conservative) invests in high-quality, large-capitalization stocks. The $1.8-billion fund’s top holdings include: Thomson Reuters, Shoppers Drug Mart, Imperial Oil, Tim Hortons, Becton Dickinson & Co., McDonald’s, Colgate-Palmolive, Nestle SA, Bank of Nova Scotia and Reckitt Benckiser Group plc. Ivy Canadian’s breakdown by industry includes: consumer staples, 35.4%; consumer discretionary, 18.9%; energy, 9.2%; financials, 8.6%; health care, 6.2%; and industrials, 6.2%....

In the past, investors bought mutual funds within the “fund families” promoted by fund sellers for a couple of main reasons. Mutual funds within a particular fund family often shared some key investment characteristic, such as a conservative or aggressive investment approach, or a stress on value as opposed to growth. That let investors switch between funds within the family at little or no charge. This way, they could rebalance their portfolios and still maintain a common investment philosophy. But it also encouraged frequent trading. That can cause investors to miss out on some of their biggest gains....

When we judge the investment quality of an individual company, we take nine key factors into account. These are: a record of profit; a record of dividends; an influential industry position; balance-sheet strength; geographical diversification; freedom from business cycles; freedom from excess regulation or insider abuse; ability to profit from lasting secular trends (such as global economic liberalization); and the ability to cash in on habitual customer behaviour. Mutual-fund ratings are more complex, since they are a step removed from these factors. Before we award our CWA Fund Ratings (Aggressive, Conservative or Income), we assess a fund’s strengths and weaknesses in several key areas. We start by looking at the quality of the fund’s holdings, based on our nine key factors. Then we look at the degree to which its holdings are spread out across the five main economic sectors: Manufacturing, Resources, Consumer, Finance and Utilities. Funds that focus on narrow segments are more risky or aggressive than those that diversify, even if they focus on a conservative area, such as Utilities....

IVY CANADIAN FUND $20.73 (CWA Rating: Conservative) (Mackenzie Financial Corp., 150 Bloor Street West, Toronto, Ontario M5S 3B5. 1-800-387-0780; Web site: www.mackenziefinancial.com. Load fund — available from brokers) is a good example of a Conservative fund. Ivy Canadian’s managers keep risk low by investing in well-established, high-quality stocks. The fund also invests in politically stable areas, with 47.3% of its portfolio in Canadian stocks, 27.8% in the U.S., 5.1% in Switzerland, 4.1% in the U.K. and 4% in France. Moreover, Ivy Canadian has $1.9 billion in assets, so it can easily meet redemption requests without having to sell parts of its holdings. Ivy Canadian Fund holds just 29 stocks. The top 10 are: Thomson Reuters, Shoppers Drug Mart, Imperial Oil, Tim Hortons, Becton Dickinson, McDonald’s Corp., Nestle SA, Colgate-Palmolive, Bank of Nova Scotia and Reckitt Benckiser. The fund is well-balanced among industry segments, with consumer staples making up the largest part of its portfolio, at 35.5%. Ivy Canadian holds 11% of its assets in cash. Ivy Canadian Fund is a Conservative buy.

International Datacasting Corp., $0.40, symbol IDC on Toronto (Shares outstanding: 57.7 million; Market cap: $22.8 million), sells products, systems and services for the distribution, or “datacasting” of broadband content (such as text, graphics and maps) to viewers with specially equipped computers, set-top boxes or digital receivers. International Datacasting’s customers include Thomson Reuters, CBS Westwood One, National Public Radio, AccessIT, SES Americom, Best Buy, Echostar, TVN and others. International Datacasting operates in two segments:...

BOMBARDIER INC., Toronto symbols BBD.A, $3.39, and BBD.B, $3.32, has received a firm order for 20 of its new CSeries regional jets from Lease Corporation International Aviation (New Buildings) Limited. Lease Corporation is an Irish company that leases aircraft to Singapore Airlines, British Airways and other major airlines. The deal is worth $1.4 billion, and Bombardier will probably begin delivering the planes in 2014. (All amounts except share price in U.S. dollars) Moreover, Lease Corporation has an option to buy 20 more jets, though it will probably wait until it has received most of the initial order before it exercises the option. To put this contract in perspective, Bombardier earned $1 billion, or $0.56 a share, in the fiscal year ended January 31, 2009. That’s more than twice the $479 million, or $0.26 a share, it earned the previous year. The year-earlier figures exclude the writedown of an investment....

LOBLAW COMPANIES LTD. $31 (Toronto symbol L) wants to shift about 10% of its part-time workers to full-time status. Right now, part-timers account for 80% of Loblaw’s workforce. More full-time workers would increase Loblaw’s labour costs, particularly as most of them are unionized. But the company feels it will offset these extra costs by lowering the high turnover rate among part-time workers. Hold. ROYAL BANK OF CANADA $34 (Toronto symbol RY) has paid an undisclosed figure for the 50% of Commission Direct Inc. (CDI) that it does not already own. CDI sells independent research and brokerage services to institutional investors. Gaining full control of CDI should make it easier for Royal to sell more services to CDI’s high-quality clientele. Buy. THOMSON REUTERS INC. $30 (Toronto symbol TRI) plans to launch a new video-news service in June 2009. Unlike cable TV business news channels, this service will only be available to Thomson Reuters’ clients. Users will be able to search for news items on specific companies or topics and view them on a variety of devices, including cellphones. The service should help increase Thomson Reuters’ share of this highly competitive market. Buy.

UNIVERSAL CANADIAN GROWTH FUND $16.35 (CWA Rating: Conservative) (Mackenzie Financial Corp., 150 Bloor St. West, Toronto, Ontario, M5S 3B5. Web site: www.mackenziefinancial.com. Tel: 1-800-387-0780; Load fund: available from brokers) holds companies with strong management and sound business prospects. The fund holds fewer than 40 stocks at all times. Universal Canadian’s top holdings include Thomson Reuters, Rogers Communications, Edwards Lifesciences, ShawCor, John Wiley & Sons, Dun & Bradstreet, Enerflex Systems, EnCana Corporation and Research in Motion. The fund’s breakdown by economic sector is as follows: 17.7% in Consumer Discretionary, 16.5% in Information Technology, 13.5% in Energy, 7.1% in Health Care, 6.3% in Telecommunications Services and 5.1% in Metals & Minerals....

BANK OF MONTREAL $32.30, Toronto symbol BMO, has agreed to buy the Canadian life insurance business of major U.S. insurer American International Group Inc. (AIG). The bank will pay $375 million, which is equal to 19% of the $2.0 billion or $3.76 a share that it earned in the fiscal year ended October 31, 2008. Bank of Montreal’s insurance operations currently supply just 2% of its total revenue, and this purchase will not significantly expand this division’s contribution. However, insurance is a future growth area. As well, Bank of Montreal probably got this business for a bargain price in light of AIG’s severe financial problems. Bank of Montreal is a buy....