SIC Multi Asset Institutional Composite

  December 2019 Year to Date
SIC Institutional 0.3% 14.3%
Benchmark* 0.0% 15.1%

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

Our allocation to Europe, emerging markets and global base metals outperformed in December.  This outperformance, however, was insufficient to close the small underperformance on a year to date basis for the SIC Multi Asset Institutional Composite against the benchmark.  Nonetheless, full year mid-teen investment returns are the best returns we have seen since 2013.  For the year, equities as an asset class significantly outperformed bonds (18.7% versus 6.3%) and our broad strategy of being overweight equities and underweight bonds was the right decision.  However, our neutral position on US and Canadian equities which outperformed and our overweight position on international equities which lagged explains our slight underperformance.   

For 2020, we expect interest rates to remain around current levels.  This rate environment should continue to favour equites – albeit perhaps with greater volatility.  We continue to look for a rotation from US mega cap equities to broader international indices.  Canada should participate in any global market rally but will likely trail global averages as the S&P TSX Composite’s domestic focus remains out of synch.   

Terry Shaunessy
James Garcelon