Preferred Shares Enjoy Another Good Month in July, Prompted by Rising Bond Yields and Interest Rates

The preferred share market enjoyed another good month in July. Rising bond yields and interest rates prompted higher prices for rate reset and floating rate issues, but lower prices for perpetual issues. Fixed rate reset issues gained 2.2% in the month, while perpetual issues declined 1.8%. On balance, the S&P/TSX Preferred Share index returned 1.11%…

Strong Performance by Rate Reset Issues Propelled Preferred Shares to a Robust Return in June

Strong performance by rate reset issues propelled the S&P/TSX Preferred Share index to a robust 2.84% return in June. Rising bond yields led to increased buying interest in rate reset shares, but growth in preferred share Exchange Traded Funds (ETFs) were also a factor. Approximately $260 million of new deposits flowed into the largest ETFs,…

Insight into the Economic Factors at Play for Retirees Around the World

In the latter half of the 20th Century, millions of retirees were able to construct a stable base for income from the three pillars of personal savings, employer pensions and government benefits. But now, early in the 21st Century, the balance has shifted. In 2017, more than three-quarters of individuals worldwide now say they believe the responsibility…

Understanding Subdued Market Volatility

By: D. David Jilek, RMA, CAIA® On June 2, the Chicago Board Options Exchange Volatility Index® or VIX1 reached a year-to-date closing low of 9.75, just above its all-time low of 9.31 in December 1993. While some have expressed a view that widespread volatility selling2 has driven volatility to “artificially” low levels, we do not share this view. We…

4 Reasons Why the VIX May Double in the Next Year

By: Brett Olsen – Nicholas J. Elward There has been much discussion lately about how stock market volatility is at near historic lows. The Chicago Board Options Exchange Volatility Index®(or VIX)1, a measure of implied or future volatility, is at a level of roughly 10 as of June 30, 2017. If one looks at the history…

Midyear Outlook: Interpreting Today’s Markets and What May Lie Ahead

DAVID LAFFERTY, CFA® Senior Vice President and Chief Market Strategist Natixis Global Asset Management — U.S. Distribution As we move into the second half of 2017, there may be a sneaking suspicion among investors that something is askew. While the market news flow is heavy, the markets themselves are eerily quiet. Realized and implied volatilities…

The World is Getting Older − Policy Needs to be Wiser

Retirement security is challenged on many fronts across the globe. Slow growth, low interest rates, and the looming threat of inflation stretch the economics of retirement funding. Debates about the viability of entitlement programs, the prioritization of short-term goals for lower taxes, and deficit reductions over ensuring long-term sustainability of retirement benefits make the politics…

Time to Prepare Portfolios for Volatility’s Return?

All has been relatively quiet across global markets for some time now. Except for a few short-lived volatility flare-ups, stocks have been climbing higher in many markets. In fact, the U.S. stock market, as measured by the S&P 500®,1 was up more than 15%* for the one-year period ending June 1, 2017, while the STOXX Europe…

Goals-based Investing: A Different Approach to Managing Risk

Most clients view risk as losing assets, market volatility or underperforming the benchmark, but isn’t the more relevant risk whether or not they will reach their goals? Isn’t that what really counts? Perhaps their financial plans should be structured around those goals – and so should client discussions.

Following Strong Gains Earlier in the Year, Investors Pull Back from Preferred Share Market in May

In last month’s commentary, we noted the potential for the preferred share market to consolidate during May, and that is what transpired, as the S&P/TSX Preferred Share index returned -1.67%. Following strong gains earlier in the year, investors appeared to pull back from the market leading to declines in prices of most issues. The weakness…

What’s Ahead for Stocks and Bonds in Second Half of 2017?

What markets have room to grow? When might volatility reappear? How do bonds look relative to equities for the next six months? Where are the opportunities? Varying views on global markets are expressed by investment professionals from across Natixis Global Asset Management in this midyear outlook. OUR PANEL RESPONSES DAVID G. HERRO CFA® Deputy Chairman,…

Retirement, Death, and Taxes. Are Investors Prepared for the Inevitable?

It’s been said that the only certainties in life are death and taxes. But now, as individuals are accountable for a greater share of post-work income, retirement is a third certainty that must be factored into long-term financial success. Despite this, many respondents in our 2017 Global Survey of Individual Investors are not taking all…

Interesting Times: What the Shift from Monetary to Fiscal Policy May Mean for Stocks

By: Dan Hughes The U.S. economy has added jobs for over 77 months in a row. Unemployment is at the lowest levels seen post-World War II. In many parts of the country, there is a shortage of skilled labor. In sum, the economy is doing well. With the S&P 500® up 15.75% for the one-year period…

Understanding the U.K. Snap Election Results

By: Lynda Coye – Josh Pritchard British Prime Minister Theresa May called for a “snap election” on June 8 – but the results were, to say the least, not what she and fellow members of her Conservative Party expected. The basics Under the United Kingdom’s parliamentary system of government, voters do not elect the prime minister…

The Long Bull Run: Is It Too Late for Investors to Consider Stocks?

DAVID LAFFERTY, CFA® Senior Vice President and Chief Market Strategist Natixis Global Asset Management — U.S. Distribution Global equity markets have now entered the ninth year of their rally off the March 2009 bottom. “How long can the equity rally last?” is the most frequent question we get from clients and advisors. In one recent…

Brexit Update: One Year After the UK Voted to Leave the EU

TRACEY E. FLAHERTY Senior Vice President, Government Relations and Retirement Strategy Natixis Global Asset Management It’s been a year since voters in the United Kingdom surprised the world by voting to take their leave of the European Union. In March 2017, Prime Minister Theresa May invoked Article 50 of the Treaty of the European Union,…

Actively Combating Portfolio Volatility

Has the relative stability of market returns in recent years lulled clients into a false sense of security about passive investing? According to institutional investors and wholesale portfolio managers (i.e., those who manage portfolios for certain insurance investment platforms, fund-of-fund solutions and third-party asset management platforms), this could be a significant issue facing individuals when…

Preferred Shares Rally into Early April, But Finish the Month Slightly Lower

The Canadian preferred share market initially extended its rally into early April, but prices declined over the balance of the month to finish slightly lower than where they began. In part, the pullback later in the month could have been market fatigue as preferred share prices have risen almost continuously since mid-November. As well, some…

What Macron’s Victory Could Mean for International Equities

By: Josh Pritchard  Voters in France have elected former economic minister Emmanuel Macron of the nascent En Marche! party as president. Macron’s victory is likely to be seen as a rejection of the populist, anti-European Union sentiment that saw Brexit approved in the United Kingdom in 2016. The defeat of National Front candidate Marine Le…

POTUS and Portfolios: The First 100 Days and Beyond

DAVID LAFFERTY, CFA® Senior Vice President and Chief Market Strategist Natixis Global Asset Management — U.S. Distribution April 29 marked President Donald Trump’s 100th day in office. Since FDR, the first hundred days of a presidency have acquired near mythical status as a measuring stick, although it is to some degree a ridiculous standard. To…