SIC Multi Asset Institutional Composite

 December 2020Year to Date
SIC Institutional1.4%6.6%

* 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

Global equity markets finished 2020 on a positive note – rising, once again, in December.  While US large cap equities did well, gaining just under 2% for the month in Canadian dollar terms, EAFE (Europe, Australasia and Far East) and Emerging Markets indices were the real stars – increasing 3% and 6% respectively (also in Canadian dollar terms).  Market breadth and regional rotation were the hallmarks of the fourth quarter.  We expect this trend to continue into 2021.  

For the year, the SIC Multi Asset Institutional Composite returned 6.6% while the benchmark was up 9%.  Almost all of the Institutional Composite’s underperformance occurred during the first quarter and as a result of market turmoil related to the COVID-19 pandemic.  Global bond markets soared during the crisis and our underweight position in fixed income hurt relative returns.

Global economies are expected to rebound in 2021.  Cyclical and value-oriented non-US equities should benefit from increased investor interest.  This scenario should result in Institutional Composite returns exceeding those for the benchmark.

Terry Shaunessy
James Garcelon