Don’t be a homer. Canadian investors who limit their palettes to managers and funds from their homeland can miss a wealth of potential talent. Here are three global equity strategies run outside of Canada that Morningstar’s global manager research analysts have vetted and rated highly. Each have People and Process ratings of Above Average or High, which is rare. They’re also benchmark-agnostic and likely to look out of sorts from time to time, so investors need patience to own them.
Renaissance Global Growth F
- Morningstar Rating: 4 stars
- Fund Size: C$4.3 billion
Walter Scott & Partners has an almost 40-year track record of selecting global companies that offer durable growth, profitability, and strong balance sheets. More than half of their research team have spent their entire investment careers at the firm, so it’s hard to beat its depth and breadth of experience. The team’s stability is also an investment edge, as the entire team has to approve stocks before purchase, which sets a high bar.
Walter Scott’s penchant for stable companies leads the portfolio to favor healthcare and discretionary names while shying away from more cyclical sectors, such as financial services and energy. The fund is also available as an ETF: CIBC Global Growth ETF CGLO.
BMO Concentrated Global Equity F
- Morningstar Rating: 3 stars
- Fund Size: C$2.4 billion
This fund’s lead managers have worked together for 25 years, of which the last 10 was spent at GuardCap Asset Management, a UK-based subsidiary of Canada’s Guardian Capital Group. The team’s stability, experience and collaboration set it apart; intensive research has also helped the fund succeed. After a lot of detailed detective work and many rounds of discussion, the managers build the portfolio from a small list of companies that meet their most stringent growth, quality, and valuation criteria. The fund offers concentrated exposure to the team’s very best ideas, so despite being diversified by sector, it will underperform at times due to its concentration and tilt toward growth.
GQG Partners Global Quality Equity F
- Morningstar Rating: 5 stars
- Fund Size: C$2.2 billion
GQG has only been around since 2016, but lead manager Rajiv Jain had a long and successful run at Vontobel Asset Management before starting the firm. While Jain’s track record is impressive, the team’s diverse and unusual skills are what truly set it apart. For example, some members are forensic accountants, and several are former investigative journalists.
Though Jain has held some stocks for years, his investment approach is flexible. He is willing to change direction quickly and decisively. In 2020, he swapped almost all the portfolio’s technology holdings for undervalued energy stocks. Energy soared in 2022, and he then upped the fund’s technology exposure again. These high conviction moves worked out, but they were still huge changes and not for the faint of heart. This fast-moving portfolio is no stranger to risk, so it might not work for investors looking for a core Global Equity fund.
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