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Matrix launches Matrix S&P/TSX Canadian Dividend Aristocrats Fund

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Matrix Funds Management has launches the Matrix S&P/TSX Canadian Dividend Aristocrats Fund (Corporate Class) – the first corporate class fund to follow Canada’s Dividend Growth benchmark from Standard & Poor’s.

The new Matrix S&P/TSX Canadian Dividend Aristocrats Fund (Corporate Class) is designed to closely match the returns and characteristics of the S&P/TSX Canadian Aristocrats Index, the leading benchmark of dividend growth in Canada. It follows companies who have increased ordinary cash dividends every year for at least five consecutive years.

The Fund combines the power of ETFs with the convenience and broad accessibility of mutual funds in a tax beneficial corporate class structure that also provides monthly income.

"This combination of desirable features has created a unique Canadian investment vehicle, allowing us to bring new choices based on sound investment principles to investors," says David Levi (pictured), CEO. "Low government bond yields have created a global income crisis for investors. With higher yield from quality companies, this new dividend growth offering complements our existing line up of monthly income solutions."

Dividends are a BIG winner in Canada according to a 2011 research study. Over nearly a quarter century, Dividend Growers in Canada returned an average of 12.6% compared with 7.3% for the TSX Composite (all figures total return, from December 1986 to February 2011++).

The S&P/TSX Canadian Dividend Aristocrats Index is an investment strategy Matrix Funds Management considers a "smart indexing" solution.

"The intelligence of this approach is simplicity. Based on our research, the fundamental factor of screening for companies that have increased cash dividends every year for at least the past 5 years has produced amazingly strong Top 10 results vs. over 300 funds in the Dividend and Income category over the same 5 year period," says Grahame Lyons, Managing Partner.

The Fund has low cost, portfolio transparency and tax efficiency which are common attributes of popular ETFs. "We feel this Fund will solve some trading related issues for securities licensed advisors (IIROC) and investment counsellors (ICPM)," adds Lyons. The product is also expected to meet demand from the larger body of mutual fund (MFDA) advisors who may also be insurance licensed advisors looking for these features in providing financial services to Canadians.

Moreover, the tax deferral opportunity of a Corporate Class share structure means Investor’s with taxable accounts can defer capital gains taxes that would otherwise have been payable on redemption if they are switching into other Matrix corporate class funds. This can add significantly to investor returns after tax over time. "Our research indicates there are CAD44.7 billion in assets over 350 Corporate Class funds, almost all using traditional active management. We see an opportunity to provide monthly income investors choice with this Standard and Poor’s(R) index strategy," concludes Lyons.

 

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