It was a tough month for the portfolios, with each ending in negative territory, and lagging their respective benchmarks. The strongest showing came from our Growth Portfolio, which was flat on the month, while our Moderate Balanced Portfolio was down 0.5%, trailing its benchmark by more than 100 basis points.
For a detailed review of the portfolios’ performance and risk reward metrics, you can download our standard monthly portfolio report here. For those looking for more detail, I am also providing additional reports generated from Morningstar which show more detail regarding the portfolios. A summary report can be downloaded here, while the more detailed report can be downloaded here.
Again, it was the usual suspects dragging performance, with the Dynamic Advantage Bond, Fidelity Canadian Large Cap, and Mackenzie Ivy Foreign Equity all underperforming, both their benchmarks and peers, largely on their more defensive positioning.
With Canadian bond yields falling, the Dynamic Advantage Bond trailed its peers because of its duration, which is roughly half that of the index.
The Fidelity Canadian Large Cap Fund and Mackenzie Ivy Foreign Equity remain defensively positioned, and cash balances remain elevated. Fidelity has a little more than 20% in cash, while Ivy has about 30%. In both cases, management is carrying the higher cash on valuation concerns. I continue to monitor these funds closely.
Again, I reiterate I am not disappointed with the absolute and risk adjusted returns the portfolios have delivered. They are well on target and within the range of expectations, and volatility has been very well contained. However, the portfolios have lagged their respective benchmarks and peer groups in the past several quarters. I remain patient, and continue to track things very closely.