The Canadian Investment Funds Standards Committee confirmed today it has made revisions to its categories, effective as of the May 31 data reporting period. There are now 34 categories, down one from previously. One new category — Canadian Income Balanced — has been added and two others — Canadian Mortgage and Latin American Equity — have been eliminated.
The category changes have been agreed to by all firms that are represented on the committee. The implementation date will be either the May 31 reporting period or a later date, depending on production deadlines.
The new Canadian Income Balanced category consists of funds that meet the criteria for Canadian Balanced, and in addition distribute income at least quarterly. To qualify for this category, funds must also distribute income at a proportionally higher rate than the median for the Canadian Balanced category.
The Canadian Short-Term Bond category has been renamed Canadian Short-Term Bond and Mortgage. This reflects the elimination of the Canadian Mortgage category, which has been consolidated with Canadian Short-Term Bond and Mortgage.
Funds that were formerly in the Latin American Equity category have been moved to Emerging Markets Equity.
Stricter limits on equity exposure have been imposed on the four fixed income categories: Canadian Bond, Canadian Short-Term Bond and Mortage, Foreign Bond and High Yield Bond. No more than 10% of assets of funds in these categories can be held in equities, based on median holdings over three years.
In the Canadian Income Trust category, a minimum 50% of the fund’s total assets must be in income trusts, up from 40%.
In other revisions, more than 100 funds have been moved to the Canadian Equity (Pure) category from the Canadian Equity category because they meet the holdings criteria for the Pure category for the past three years. The Pure category is for diversified domestic equity funds whose foreign exposure is less than 5% of non-cash assets.
For a complete list of category defdinitions, please click here: CIFSC category list