Global equity markets were positive after the U.S. Federal Reserve shocked the markets and did not implement any tapering to their massive bond buying program. Expectations that a taper of between $10 and $20 billion would be announced at the September meeting. With no taper on the immediate horizon, both bond and equity markets rallied higher.
Each of our portfolios was in positive territory in September. Our Conservative portfolio gained 0.7% while our Growth portfolio gained 1.5%. Despite the pullback in yields, two of our bond funds were in negative territory. The Manulife Strategic Income Fund lost 0.75% during the month in Canadian dollar terms. However, this loss can be attributed to the gain in the Canadain dollar, because the fund was up by more than 1.8% in U.S. dollar terms. The TD Real Return Bond Fund was the other laggard in the portfolios, losing 0.20% in the month, as inflation protected bonds in general were hit on lowered inflation expectations.
The portfolios continue to deliver risk adjusted returns that are significantly stronger than their respective benchmarks. Their absolute return levels are well within our expected ranges based on the risk reward profile of each portfolio.
You can download our detailed Portfolio Review here.
Portfolio Performance (September 30, 2013)
| 1 Mth | 3 Mth | YTD | 1 Yr | 2 Yr | 3 Yr | 5 Yr | 10 Yr | |
|---|---|---|---|---|---|---|---|---|
| Conservative | 0.7% | 1.3% | 4.6% | 5.7% | 6.5% | 4.9% | 6.2% | 5.5% |
| Moderate Balanced | 0.9% | 2.0% | 7.8% | 9.2% | 8.6% | 5.7% | 6.1% | 5.7% |
| Balanced | 1.0% | 2.5% | 9.2% | 10.4% | 9.5% | 6.0% | 6.0% | 6.1% |
| Balanced Growth | 1.2% | 3.2% | 13.0% | 14.3% | 12.1% | 7.1% | 5.8% | 6.2% |
| Growth Portfolio | 1.5% | 4.2% | 16.9% | 18.4% | 15.3% | 9.4% | 6.4% | 6.8% |