Analysis

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About MACKENZIE MAXIMUM DIVERSIFICATION A UNITS

The fund provides a portfolio of low-correlation developed markets (excluding North America) equity securities while excluding firms that do not align with the index provider's definition of socially responsible investing principles. The index screens the eligible universe of large- and midcap companies, removing those involved in the production of controversial weapons, tobacco, or coal, and those engaged in human rights violations, environmental damage, corruption, or other serious ethical violations. Next, the index uses a mathematical model to minimize the covariance between its constituents, resulting in a portfolio of stocks with low or negative correlations to each other, which is the maximum diversification alluded to in the funds name. The model applies constraints to ensure that the portfolio does not stray too far from market weights, but these are loose enough that significant tilts are still possible. The index is reconstituted quarterly.