SIC Multi Asset Institutional Composite

 July 2020Year to Date
SIC Institutional3.2%-0.3%
Benchmark*2.3%2.5%

* 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

Despite concerns over spreading COVID-19 cases as economies reopened globally, equity markets continued to advance in July with the global equity benchmark MSCI World Index rising by 3% for the month.  While the US technology sector was, once again, at the forefront, with the NASDAQ Composite gaining 7% in July, other sectors and regions, most notably precious metals and emerging markets, made significant contributions.  Fixed income markets advanced by 1% as central banks and worried investors continued to chase miniscule yields.  

For the month, the SIC Multi Asset Institutional Composite outpaced the benchmark.  On a year to date basis, however, the Institutional Composite continued to trail the benchmark.  Mostly owing to our underweight position in fixed income during the central bank induced bond rally witnessed in the spring.  

As global economies continue to recover in a “managed” COVID-19 environment, we expect that the combination of ultra-low interest rates and building investor confidence will keep funds flowing into equities.  We continue to favour equities over fixed income and look for a regional rotation from US to international equities to become more prominent in the second half of 2020.    

Terry Shaunessy
James Garcelon