Roughly 60% of Canadian equity active fund managers outperformed the S&P/TSX Composite Index in third quarter, according to the lastest latest results for the Standard & Poor’s Indices Versus Active Funds Scorecard (SPIVA) for Canada.

This is in stark contrast to the previous quarter when only 31% of Canadian active funds were able to outperform their benchmarks.

Only 35% of active funds in the Small/Mid Cap Equity category beat the S&P/TSX completion index. In the Canadian focused equity category 46% of active funds outperformed the blended benchmark of 50% S&P/TSX Composite + 25% S&P 500 + 25% S&P/Citigroup EPAC PMI.

“The majority of Canadian Equity active funds were able to add value over the third quarter,” says Jasmit Bhandal, director at Standard & Poor’s. “However, when looking at longer term results the trend continues to be that few active funds are able to beat their benchmark.”

SPIVA reports the performance of actively managed Canadian mutual funds corrected for survivorship bias, and shows equal- and asset-weighted peer averages.

SPIVA results for the third quarter of 2008 showed mixed results in mutual funds investing outside of Canada. Only 34% of active U.S. equity funds outperformed the S&P 500, 52% of international equity funds outperformed the S&P/Citigroup EPAC PMI Index and only 38% of Global Equity funds outperformed the S&P/Citigroup World PMI Index.

The majority of active funds underperformed their respective S&P benchmark over one, three- and five-year periods. Only 23%, 9% and 7% respectively, of active Canadian equity funds were able to outperform the S&P/TSX composite index over these periods respectively.

For active funds in the Canadian focused equity category 51%, 42% and 52% of funds outpaced the blended S&P/TSX composite benchmark index over the one, three- and five-year periods respectively.

IE