February 2, 2018

Foreign Equity Funds' Winning Streak Continues in January 2018, Morningstar Canada Data Show

TORONTO, Feb. 2, 2018 /PRNewswire/ -- Morningstar Research Inc., a Canadian subsidiary of Chicago-based independent investment research provider Morningstar, Inc. (NASDAQ: MORN), today released preliminary January 2018 performance data for its 44 Morningstar Canada Fund Indices, which measure the aggregate returns of funds in various standard categories. Twenty-four of the 44 fund indices increased during the month, with nine of them increasing by 2.0% or more, while 18 of the 20 losing indices decreased by 1.6% or less.                                       

Highlights from Morningstar's January 2018 preliminary performance report include:

  • The best performer among the 44 Morningstar Canada Fund Indices was the one that tracks the Greater China Equity category, which followed up its chart-topping 35.9% increase in 2017 with an 8.7% increase in January. While currency effects detracted from returns during the month, stock markets in Hong Kong, Shanghai, and Taiwan posted solid gains of 9.9%, 5.3%, and 4.3%, respectively.
  • The fund indices that track the Asia Pacific ex-Japan Equity and Asia Pacific Equity categories, which were among the top performers in 2017, also continued their winning streak in January, increasing 3.5% and 3.3%, respectively. While China was the main driver of returns, other markets including South Korea and Japan also contributed positively. The strength of Asian stocks also helped funds in the Emerging Markets Equity category, which collectively increased 5.0%.
  • In the United States, the S&P 500 Index posted a total return of 5.7%, but the U.S. dollar depreciated by 2.0% against its Canadian counterpart, resulting in an increase of 3.6% for the Morningstar U.S. Equity Fund Index. This was the third-best result among the 44 Morningstar Canada Fund Indices in January. 
  • Among other fund indices that track sector-diversified fund categories, Global Equity increased 2.7%, while International Equity and European Equity were up 2.2% and 2.1%, respectively.
  • Domestic equity funds were among the worst-performing equity categories for the month, as the energy sector continued to impede the Canadian market. The Morningstar Canadian Equity Fund Index had the worst result among all diversified equity categories with a 1.4% decrease, matching the total return of the S&P/TSX Composite Index. The Canadian Dividend & Income Equity and Canadian Small/Mid Cap Equity fund indices were also in the red with decreases of 1.3% and 1.1%, respectively, while the fund indices that track the Canadian Focused Small/Mid Cap Equity and Canadian Focused Equity categories—whose constituent funds can hold up to half their assets in non-Canadian stocks—had positive results with 1.8% and 0.3%, respectively.
  • The worst-performing fund indices were the ones that track the Precious Metals Equity and the Energy Equity fund categories, decreasing 2.6% and 2.7%, respectively. Three other sector-specific fund indices in negative territory for the month were Global Infrastructure Equity, Natural Resources Equity, and Real Estate Equity, down 1.6%, 0.7%, and 0.7%, respectively. The only sector-fund category to post an increase was Financial Services Equity, up 2.5%.

To view the complete report about Morningstar's preliminary January 2018 performance data for Canadian funds, please visit https://goo.gl/9K61Fu.

Morningstar Canada's preliminary fund performance figures are based on change in funds' net asset values per share during the month, and do not necessarily include end-of-month income distributions. Final performance figures will be published on www.morningstar.ca next week.

About Morningstar Research Inc. and Morningstar, Inc.
Morningstar Research Inc. is a Canadian subsidiary of Chicago-based Morningstar, Inc., a leading provider of independent investment research in North America, Europe, Australia, and Asia. The company offers an extensive line of products and services for individual investors, financial advisors, asset managers, and retirement plan providers and sponsors, and institutional investors in the private capital markets. Morningstar provides data and research insights on a wide range of investment offerings, including managed investment products, publicly listed companies, private capital markets, and real-time global market data. Morningstar also offers investment management services through its investment advisory subsidiaries, with more than US$220 billion in assets under advisement and management as of Sept. 30, 2017. The company has operations in 27 countries.

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