Fundata launches Prospectus Risk Indices
Fundata Canada is launching a series of Canadian fund indices, The Fundata Prospectus Risk Indices, which are designed to provide institutions, portfolio managers, advisers and retail investors with a tool for comparing performance and volatility among mutual funds with similar risk prospects.
"Prospectus Risk Rating is one of Fundata's most popular and unique data points," says Janny Vincent, president of Fundata Canada. "Fund managers, advisers, and their clients have become acutely aware of the importance of considering investment risks."
While standard risk metrics can provide a picture of an individual fund's historic performance, and peer-group indices can give a raw performance benchmark, an objective yardstick of performance among funds with similar Prospectus Risk prospects has been absent.
Among the 850 fund data points it tracks, Fundata Canada captures of 99.9 per cent of the current Prospectus Risk Ratings of the more than 12,300 prospectus-issuing mutual funds in Canada.
"Given our massive data warehouse of current and historical Canadian mutual fund information, the development of benchmark Prospectus Risk Indices was a natural progression for us," says Vincent.
The Fundata Prospectus Risk Indices have been rigorously constructed and intensively back-tested against historical data to ensure accuracy. Professor Eric Kirzner, holding the John H Watson Chair of Value Investing at the University of Toronto Rotman School of Management, acted as external consultant on the construction and testing of the indices. Kirzner is an expert in complex derivative valuation, market operations and regulation, a pioneer in Canadian exchange-traded fund development, and co-developer of the popular FPX Indexes.
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