TORONTO, Oct. 28 /CNW/ -- Morningstar Research Inc., a Canadian subsidiary of Morningstar, Inc. (NASDAQ: MORN), a leading provider of independent investment research, today reported a summary of institutional pooled fund performance in Canada for the third quarter of 2009. Though the results weren't as spectacular as in the second quarter, they were still overwhelmingly positive, with more than 98% of the 1,065 pooled funds in the company's Canadian database posting gains for the quarter, including all but one of the 592 equity-focused funds.

All 41 of the Morningstar Canada Pooled Fund Indices had positive returns for the quarter. (The fund indices measure the asset-weighted average return of all funds within a category.) Sixteen of the indices returned more than 10% over the three-month period, with five of them gaining 15% or more. The best-performing fund index was the one that tracks the Natural Resources Equity category, which gained 25%. Most of that fund index's gains came in July and September, when it returned 9.8% and 9.9%, respectively.

Pooled funds that focus on smaller Canadian companies did particularly well in the third quarter. The Canadian Small/Mid Cap Equity and Canadian Focused Small/Mid Cap Equity pooled fund indices ranked second and third overall, respectively, with gains of 19.1% and 17.3%. Of the 49 pooled funds that comprise these two categories, 48 posted double-digit gains for the quarter. The best performer with a 25.6% gain was Manulife Canadian Small Cap Equity, followed by Howson Tattersall Canadian Small Cap Value Equity, up 25.2%. Both of these funds are managed by Howson Tattersall Investment Counsel Ltd. and have very similar portfolios. The only fund in these categories to return less than 10% was PH&N Vintage, up 9.8%.

Two other fund indices that track sector-specific categories round out the top five: Real Estate Equity finished fourth with a 16.3% return, followed closely by Precious Metals Equity and its 16.2% gain. It is worth noting, however, that the three top-performing sector-specific categories each contain five funds or fewer.

The fund index that tracks the Canadian Equity category - the largest among all equity pooled fund categories in terms of both number of funds and assets under management - gained 10.1% in the third quarter. Returns among the 141 funds in that category ranged from 7.4% for both Burgundy Focus Canadian Equity and Guardian Canadian Equity, to 21.7% for Montrusco Bolton Quantitative Canadian Equity.

Among the three largest foreign equity categories, the International Equity pooled fund index gained 15.3% for the quarter, ranking 13th overall, while Global Equity returned 10.6% (ranking 19th), and U.S. Equity was up 6.7% (ranking 30th).