Quarterly Fund Updates

 RIDGEWOOD CANADIAN INVESTMENT GRADE BOND FUND - RIB.UN
 Quarterly Fund Update at December 31, 2011

 Fund Objectives
 
The Fund will seek to achieve the following investment objectives:

  • to provide unitholders with monthly cash distributions, initially targeted to be 5.25% per annum on the original issue price of $12.00 per unit; and
  • to maximize total returns for unitholders while preserving capital in the long term.
    		•

     Investment Strategy
     
    The portfolio of the Fund will be invested primarily in investment grade bonds issued by Canadian issuers available to domiciled investors. In addition, the Fund may invest up to 10% of the Portfolio in U.S. investment grade bonds and up to 25% in investment grade bonds issued by non-Canadian issuers (Maples). From time to time, the Fund may hold cash and cash equivalents. The Fund may borrow an amount up to 25% of the total amount of the fund.

     Fund Data
     Fund Manager   Ridgewood Capital Asset Management Inc. ("Ridgewood")
     Inception Date    December 18, 2009
     Net Asset Value as at December 18, 2009    $12.00
     Net Asset Value as at December 31, 2011    $10.98
     Closing Trading Price as at December 30, 2011    $11.60
     Issue Price    $12.00
     Eligible For    RRSPs, DPSPs, RRIFs, RESPs
     Distribution Policy    5.25% per annum on issue price
     Distributions History:   
     2011    $0.9300
     2010    $0.9000
     2009    $0.00000

     Commentary
     
  • The bond market experienced a positive fourth quarter of 2011 as the DEX Index gained 2.09%.
  • Provincial bonds were the top performing sector, returning a positive 3.68%.
  • Maple bonds were one of the weaker performing sectors, returning .53%.
  • We continue to remain positive on the outlook for the fixed income market.
  • The portfolio is positioned to take advantage of the gradual recovery and will maintain a fully invested portfolio with an active overweight in corporate bonds
  • Unitholders received distributions totaling $0.1575 per unit during the fourth quarter of 2011.
  • Further to the Prospectus, the Fund may utilize various forms of borrowings including a loan facility and margin purchases, up to 25% of the total assets of the Fund at the time of borrowing. As of December 31, 2011, $20,048,218 of the Fund was leveraged. During the three months ending December 31, 2011 $95,812 in interest charges were incurred. In this period the Fund’s maximum leverage outstanding was $20,048,218 and the minimum leverage outstanding was $4,045,218.

    		•

     Top 25 Holdings
     Holding
     Percentage of Net Asset Value
     1. Citibank 5.365% 2013/03/06
    5.2%
     2. Merrill Lynch, 7.405%  2019/12/31
    5.1%
     3. Citibank 5.16% 2022/05/24
    5.0%
     4. Merrill Lynch Financial Assets Inc., C19 D 2016/06/12
    5.0%
     5. Merrill Lynch Financial Assets Inc., 5.557%  2017/08/12
    4.8%
     6. Lloyds TSB Bank 10.125% 2021/12/16
    4.4%
     7. Merrill Lynch Financial Assets Inc., CA23 AJ 2017/08/12
    4.3%
     8. Merrill Lynch, 5.29%  2017/05/30
    4.3%
     9. Goldman Sachs 5.00% 2018/05/03
    3.9%
     10. CIBC 9.976% 2019/06/30
    3.9%
     11. Sun Life Financial 4.57% 2021/08/23
    3.6%
     12. CIBC 10.25% 2039/06/30
    3.3%
     13. Merrill Lynch Financial Assets Inc., CA22 D2017/05/12
    3.3%
     14. Inst Mortgage Sec Tranche D 2021/02/12
    3.3%
     15. Nova Scotia Power 8.3% 2036/03/21
    3.2%
     16. Algonquin Power 5.25% 2018/07/25
    3.2%
     17. RealT 5.11495% 2015/10/12
    3.2%
     18. JPM 5.058% 2016/02/22
    3.0%
     19. Lloyds Bank PLC 5.28% 2016/04/19
    3.0%
     20. Morgan Stanely 4.9% 2016/05/04
    2.8%
     21. Home Capital 5.20% 2016/05/04
    2.7%
     22. TD C4 10.00% 2039/06/03
    2.5%
     23. TD 6.631% 2021/06/30
    2.4%
     24. Bell Aliant Reg 4.88% 2018/04/26
    2.2%
     25. Shaw 6.75% 2039/11/09
    2.2%
     
     Total
     89.70%

     Asset Mix
     Sector Allocation
     Percentage of Net Asset Value
     Corporate Bonds
    99.1%
     Cash and Short-Term Investments
    .9%
       
     Total
     100.00%

     Currency Asset Mix
     Currency Allocation
     Percentage of Net Asset Value
     Canadian Dollar Denominated Bonds
    99.1%
     Cash and Short-Term Investments
    .9%
     
     Total
     100.00%

    The summary of the investment portfolio may change due to the ongoing portfolio transactions of the Fund. A quarterly update will be available on our website.