By Scott Ronalds

At the annual Morningstar Canadian Investment Awards last night in Toronto, Serena Ryder was the star of the show (although it was tragic she only did one song), but Steadyhand did OK too. Our Income Fund was recognized as the Best Canadian Balanced Fund for the second year in a row.

We’re an uneasy bunch at Steadyhand when it comes to performance awards, as they are backward looking and can be based on short measurement periods (Stewardship Grades are a different matter). Nonetheless, we’re pleased with the recognition received last night. Morningstar is a leading fund research company and we respect their analysts and qualitative judgment. Moreover, the award was not based solely on short-term returns (the other finalists, all of which had more equity content, had better short-term numbers). Rather, it was decided upon by a diversified panel of industry professionals.

The Income Fund is a key component in most of our clients’ portfolios, as well as the Founders Fund. The recognition says our clients have done well.

The team at Connor, Clark & Lunn Investment Management (the manager of the fund) has done an excellent job in meeting the fund’s objectives (‘a bond beater’) and we’re confident that it’s well positioned to be a leader going forward. That said, we’ve been stressing to clients and prospective investors the importance of maintaining realistic return expectations. In an environment of 2-3% interest rates, the fund is not going to produce the high single-digit returns it has in the past. A more realistic return assumption over the medium term is more like 3-5%.

At the end of the day, the real award is having a well-informed and well-behaved client base. There should be a trophy for that.