Global Markets Fall Again: How MD is Faring

January 15, 2016

Markets around the world continue to decline and as we noted in an earlier release, volatility is likely to continue.

How are MD funds and pools performing?

Over the past two weeks of heightened market volatility, our mandates and portfolios have performed in line with our expectations and most have outperformed their benchmarks.

MD Precision PortfoliosTM
  • 5 out of 6 MD Precision PortfoliosTM added value over their respective benchmarks
Non-Canadian equity mandates
  • Added value against benchmarks and performed well compared to peers
  • International mandates added more than 2% excess return over its benchmark
Canadian mandates
  • Benchmark relative performance is mixed: value strategy outperformed while growth strategy underperformed
  • However, these are in line with our expectations
Alternative mandates
  • Added value over their benchmarks
  • MD Strategic Yield Fund returned 2.9% on a year-to-date basis
Fixed income mandates
  • All mandates have generated positive returns
  • Short-term and core mandates: relative performance is slightly below benchmarks
  • Long-term Bond Pool: relative performance is above its benchmark

Why are markets volatile?

Here is a synopsis of the causes of the recent volatility:

  • Oil prices: Oil prices have lost around 20% this year, which caught the market by surprise as it was already down significantly in 2015.
  • High-yield market: Creates market volatility in both equity and fixed income and can also impact other credit products.
  • China: There have been high levels of volatility in the local equity market since last summer.

What is MD doing?

MD’s well-diversified portfolios are built to withstand short-term volatility and we are seeing evidence of this when we look at relative and benchmark performances.

However, our focus is always on long-term results, and we aim to deliver performance that’s consistent with investor goals and time horizons. Our funds and portfolios have fared well over the market volatility experienced so far this year.

We encourage you to contact your MD Advisor if you have any questions. To learn more about MD’s approach, see MD’s Preparedness for Market Volatility.

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