Natixis Canada Blog

Month: September 2014

Time Does Not Stand Still, and Neither Does the Global Economy

Charles Lannon – Toron AMI

September marks the one year anniversary of the successful launch of the NexGen Global Equity Funds. Apart from a slight hiccup in Q1 2014, global equity markets have had positive returns in this time, although the rate of return thus far in 2014 is unsurprisingly more modest than the torrid pace of calendar 2013, wherein the MSCI World Index of global equities returned 36% in Canadian dollar terms. The reasons for the positive return of the Fund and global equities during the past twelve months are fundamentally identical to those that have drivenCharles Lannon photo this bull market since 2009: Global economic growth continues to accelerate, and should reach at least 2.5% in 2014 – a weak figure, but materially better than the 2012-13 result. Global equities, at 15.5 times 2014 earnings, remain reasonably valued on a historic basis, and offer their dividend yield of 2.5% which is well above the yield available on either cash or bonds. Fears of another post-Lehman meltdown, be it in the form of a run on European banks, the inability of the U.S. government to finance itself, or the dissolution of the European Union have all proven to be wildly wide of the mark. This latter point serves to remind investors that an excess of bearishness can be every bit as detrimental to the attainment of their financial objectives as an excess of bullishness!

To read more about the impact of the global equity market on NexGen’s Global Equity Funds, click here.

Thinking Beyond “Ideal Conditions”

Donald Nesbitt & Mikhail Alkhazov – Ziegler Capital Management

The maZiegler Photosjor U.S. equity markets remain in an uptrend as investors returned to stocks in August, responding to generally favorable economic conditions and seeking higher expected returns. U.S. equity markets began August with lackluster performance, but soon picked up the continuation of the long-term upward trajectory with several major indices hitting record highs in the latter half of the month and the S&P 500 Index closing above the 2000 level.

To read more about Ziegler’s outlook for U.S. equities, click here.

A Modest Shift – Bond Commentary from Jeff Herold

Jeff Herold – J. Zechner Associates Inc.

The bond market rally continued in August. Investors focussed on potential European Central Bank measures to stimulJeff-Herold-Photoate that area’s growth and avoid possible deflation developing. Geopolitical concerns, particularly Ukraine/Russia, also generated some demand for bonds. Economic developments in Canada and the United States were generally good, but ignored by the market as central bankers in both countries reiterated their dovish concerns about the durability of the expansion. The FTSE TMX Canada Universe Bond index returned 1.07% in the month.

To read more of Jeff Herold’s commentary on the bond market rally in August, click here.

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