Greater China Equity was top performing fund category in May

By The IJ Staff | June 02 2017 11:30AM

Photo: Freepik

Morningstar Research Inc. has released its preliminary performance data for the month of May. Of the 44 fund indices, 26 saw an increase over the month of May, four of which saw an increase of over 2 per cent.

The data tracked by Morningstar measures the aggregate returns of funds in various standard categories. Highlights of the May report include the lackluster performance of North American stock markets during the month of May, with minimal currency movements. “As a result, funds that focus on overseas equity typically outperformed those that target Canadian or U.S. stocks,” said Morningstar in a news release issued June 2.

Hang Seng Index was up 4.2 per cent

The data revealed the best performer among the 44 Morningstar Canada Fund Indices was the one that tracks funds in the Greater China Equity category, which increased by 3.2 per cent. Hong Kong's Hang Seng Index was up 4.2 per cent for the month, but part of that gain was offset by a 1.4 per cent depreciation of the Hong Kong dollar versus the Canadian dollar. Stocks in Taiwan went up 1.7 per cent, but the Shanghai Composite Index went down 1.2 per cent in May. 

The second-best-performing fund category in May was European Equity with a 2.9 per cent increase. The UK's FTSE 100 Index was up 4.4 per cent, and while major markets in France and Germany saw little movement, the euro gained 1.8 per cent against the Canadian dollar, says Morningstar.

Canadian dollar appreciated against U.S. dollar

In the United States, the S&P 500 Index had a total return of 1.4 per cent, which was offset by the Canadian dollar's 1.2 per cent appreciation against the U.S. dollar. “As a result, funds in the U.S. Equity category produced an aggregate gain of 0.3 per cent. The Morningstar U.S. Small/Mid Cap Equity Fund Index decreased 0.3 per cent for the month.”

In Canada, the S&P/TSX Composite Index produced a total return of -1.3 per cent, because of the country's three largest stock sectors having negative performances. The energy, materials, and financials sub-indexes lost 5.6 per cent, 2.2 per cent, and 2.0 per cent, respectively. 

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