CI Investments Inc. yesterday announced a number of changes to its fund lineup, including name changes, a proposal to merge four funds, and a proposal to expand and clarify the investment objectives of Signature Dividend Fund.

“These changes are guided by our goal of enhancing the efficiency and appeal of our fund lineup,” said Peter Anderson, president and CEO of CI Investments Inc., in a release.

First, CI is proposing to change the investment objectives of Signature Dividend Fund to allow it to invest primarily in dividend-paying common and preferred shares of Canadian companies, as well to invest in other common shares, fixed-income securities and income trusts, and foreign securities.

Currently, the fund invests a significant portion of its portfolio in preferred shares. However, the liquidity of the preferred share market and supply of new issues have decreased in recent years, diminishing the number of attractive investment opportunities in this sector. CI believes that revising the investment objectives will benefit unitholders by expanding the fund’s universe of potential investments.

Second, as part of its ongoing efforts to streamline its lineup and reduce the number of funds with similar mandates, CI is proposing several fund mergers:

    ,li>CI Explorer Fund into CI American Small Companies Fund and CI Explorer Corporate Class into CI American Small Companies Corporate Class. As part of this, CI Explorer Fund Insight Units will be merged into CI American Small Companies Fund Class F units. Both CI Explorer and CI American Small Companies funds are managed by Epoch Investment Partners, Inc. of New York and invest in North American small-cap companies, although CI Explorer Fund invests primarily in Canadian companies. As the Canadian small-cap market has limited size and liquidity, CI believes that investors in CI Explorer Fund will benefit from the merger into a fund with a broader set of investment opportunities, while retaining exposure to the small-cap asset class.

  • CI Canadian Growth Portfolio into CI Global Balanced Portfolio.
  • CI Canadian Maximum Growth Portfolio into CI Global Maximum Growth Portfolio.

    In the case of both portfolio funds, the funds’ investment objectives are substantially similar, although their overall asset allocations are different. (The portfolio funds invest in a number of other CI mutual funds to achieve a portfolio diversified by asset class, region and investment style.) The key difference is that the Canadian portfolios have target asset allocations of 65%-70% in Canadian funds, versus 30%-55% for the global portfolios. CI believes that investors will benefit from being merged into portfolios that have a higher foreign content and therefore are more diversified and efficient, especially since the high level of Canadian content is no longer necessary for registered plans with the elimination last year of the foreign content limits.

    Special meetings of Signature Dividend Fund and of the funds to be merged will be held on or about July 27. If approved by unitholders, the changes will take effect July 31.

    CI also is changing the names of the following mutual funds, effective June 30:

    • Synergy Extreme Canadian Equity Fund will be renamed Synergy Focus Canadian Equity Fund.
    • Synergy Extreme Global Equity Fund will be renamed Synergy Focus Global Equity Fund.
    • CI Global Boomernomics Corporate Class will be renamed CI Global Balanced Corporate Class.

    As a result of the changes announced today, a number of segregated funds will have new underlying funds and/or new names.

    Additional information on these proposals will be posted in the “What’s New” section of the CI Investments web site at www.ci.com.