January 2019 Report

 SIC Multi Asset Institutional Composite

* 5% T Bills, 35% Canadian Bond Composite, 20% TSX Composite TRI, 20% S&P 500 C$ TRI, 20% MSCI EAFE (Net) C$ TRI 

The new year brought new confidence to global investors that a more benign US Federal Reserve would not continue on a tighter monetary policy path.  As a result, fears of a recession appear to have been assuaged for the near-term.  This new-found confidence combined with the absence of the tax loss selling witnessed in December and greater liquidity experienced seasonally in January gave global equity markets a significant boost. 

The SIC Multi Asset Institutional Composite increased by 4.5% in January surpassing the benchmark’s return for the month.  An overweight allocation to equities relative to the benchmark was a key factor.  The outperformance of US and European Equal Weight, Emerging Market and Base Metal ETFs also contributed to the good results. 

All eyes remain focused on China/US trade talks to justify further meaningful increases in equity values.  At the same time, central bank policies (ECB, BOJ, BOC & Fed) appear to be quite dovish.  We expect some stability in the fixed income and foreign exchange markets as a result. 

Terry Shaunessy
James Garcelon