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Mackenzie’s mutual fund assets under management were $41.6 billion at December 31, 2005, an increase of $4.3 billion or 11.5% from $37.3 billion as at December 31, 2004. Mackenzie’s total assets under management at December 31, 2005 were $49.9 billion, an increase of $7.6 billion or 17.7% from $42.3 billion at December 31, 2004. The changes in assets under management are summarized in Table 8.
In 2005, gross sales of Mackenzie’s mutual funds were $8.1 billion, an increase of 19.0% from $6.8 billion in 2004. Redemptions of mutual funds in the current year were $6.9 billion as compared to redemptions of $6.0 billion in 2004. Net sales of mutual funds during 2005 were $1.17 billion, as compared to net sales of $795 million last year. Net sales of long-term funds were $1.03 billion in 2005, as compared to net sales of long-term funds of $819 million in 2004.
As at December 31, 2005, Mackenzie’s twelve month trailing redemption rate for long-term funds was 14.8% as compared to 13.8% last year. One of the factors contributing to this is the increase in the proportion of Mackenzie’s mutual fund units no longer subject to a redemption fee. The twelve month trailing redemption rate for long-term funds for all other members of IFIC increased to 15.7% at December 31, 2005 from 14.8% last year.
During 2005, investment returns generated for Mackenzie unitholders resulted in mutual fund assets increasing by $3.1 billion as compared to an increase of $2.7 billion in 2004.
Mackenzie also provides investment management services to institutional accounts. The assets in these accounts as at December 31, 2005 were $8.1 billion, a 64.1% increase from $4.9 billion last year. As well, Mackenzie’s structured products totalled $203 million as at December 31, 2005, an increase of $74 million as compared to December 31, 2004.
Table 8: Changes in assets under management
Mutual Funds
 At December 31, 2005, 55.2% of Mackenzie’s mutual fund assets measured by Morningstar† fund ranking service had four or five star ratings and 90.7% had a rating of three stars or better. This compares to 69% and 87% respectively at December 31, 2004, and to the Morningstar† universe of 45.6% for four and five star and 86.6% for three stars or better as at December 31, 2005.
Mackenzie’s Cundill Funds continued their strong performance in 2005. Three of Cundill’s five rated funds earned the five-star rating offered by Morningstar†. Mackenzie Cundill Value Fund was among the top performing global equity mutual funds available to Canadian investors and was the top selling global equity fund in Canada during 2005. This fund ended the year with $4.3 billion in assets. Mackenzie Cundill Recovery Fund received recognition as best Global Equity Fund at the 2005 Canadian Investment Awards, one of two specialty awards garnered by Mackenzie.
Mackenzie Universal Canadian Resource Fund also received an award at the Canadian Investment Awards, as best Natural Resources Equity Fund. Through a sub-advisory relationship, U.S. retail investors are drawing upon Mackenzie’s knowledge of global natural resources investing via U.S. based Waddell & Reed’s Ivy Global Natural Resources Fund. The fund experienced strong sales with assets growing to $2.9 billion in 2005 from $1.1 billion last year.
While the Ivy funds experienced net redemptions in 2005 they attracted more than $1.0 billion in new sales. The Ivy team builds diversified portfolios of businesses that exhibit the characteristics of conservative growth purchased at reasonable prices. Currency is not hedged, so that the Ivy funds offer Canadian investors diversifi- cation not only in terms of foreign businesses, but also in terms of foreign currencies. Canadian equity market advances during 2005 were largely influenced by increases in the energy and natural resource sectors, sectors in which the Ivy funds did not have significant holdings.
In addition to funds in the Cundill fund family, a broad cross section of funds from Mackenzie’s other fund families, including Mackenzie Select Managers Japan Capital Class, Mackenzie Sentinel Corporate Bond Fund, Mackenzie Universal U.S. Growth Leaders Fund and Mackenzie Maxxum Canadian Equity Growth Fund, were among the performance leaders in their respective categories.
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