S&P Announces Launch of Canadian Indices versus Active Funds Scorecard

December 6, 2004 (PLANSPONSOR.com) - Standard & Poor's has announced the extension of its proprietary Indices Versus Active Funds Scorecard (SPIVA) for Canadian mutual funds.

The scorecards will provide quarterly updates regarding the performance of Canadian mutual funds versus their relevant benchmarks, according to an S&P press release. Already in place in the US, the scorecards adjust for survivorship bias and show both equal- and asset-weighted results.

SPIVA results for the Canadian mutual fund industry show that in the past five years, 35.4% of actively managed funds in the Canadian equity category outperformed the S&P/TSX Composite Index, while 34.3% of actively managed funds in the Canadian SmallCap category outperformed thier benchmark, the S&P/TSX SmallCap Index. Meanwhile, only 25.8% of actively managed funds in the US Equity category have outperformed the S&P 500.

Over three- and five-year horizons, benchmark indices have returns that are higher than the asset- and equal-weighted average returns for active funds in all three categories, S&P reports.

Over the past year, SPIVA shows that only 17.5% of actively managed Canadian Equity mutual funds have outperformed the S&P/TSX Composite Index. US Equity mutual funds have done only slightly better, with 25.3% outperforming the S&P 500. Canadian SmallCap has faired much better, however, with 71.4% of these actively managed funds beating the S&Ps Canadian small cap index.

For a complete third quarter SPIVA Canada scorecard, please see www.spiva.standardandpoors.com .