- Last Ratings Update:03/31/2016
- Price as of 03/31/2016 :$11.99
- Net Assets:$3,142 Million
- Peer Rank:19 of 38
- Investment Rating:D-
We rate Central Fund of Canada at D-. Negative factors that influence this rating include a well below average total return. The fund may be considered for investors seeking a Sector - Precious Metals strategy.
POSITIVES AND RISKS
Total return ranks well below peers over the last three years. The Central Fund of Canada has returned an annual rate of 2.62% since inception. More recently, the fund has generated a total return of -12.45% in the last five years, -14.71% in the last three years, and -2.06% in the last year. How does that compare to other equity funds? In the last five years, it has outperformed 11% of them. It has also outpaced 10% of its competitors on a three year basis and 54% of them over the last year for the period ending 3/31/2016. On a year to date basis, CEF has returned 18.02%.
Downside risk has been above average. CEF has a draw down risk of -48.43%, which is the largest price decline experienced over the last three years. This fund has a three year standard deviation of 25.6%. This fund has experienced excessive volatility in its monthly performance over the last 36 months. As of 3/31/2016, the fund was trading at a price of $11.99, which is 3.5% below its 52-week high of $12.42 and 2.7% above its 52-week low of $11.67.
Low expense ratio helps performance. On total assets of $3.14 billion, CEF maintains a low expense ratio compared to its Sector - Precious Metals peers of just 0.38% to cover all operating costs. Brokerage costs for the fund to buy and sell shares are not included in the expense ratio. As CEF is a closed end fund, it has no front end or back end load.
Manager tenure is a net positive but performance record lags managerial peers. Substandard fund managers tend to be replaced, so a long tenure is usually a good sign that a fund is achieving its objectives. The Central Fund of Canada has been managed by Philip M. Spicer for the last 10 years. Over that period, the manager was able to capture more actual gains in excess of the expected return than just 31% of other fund managers.
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