Global equities boosting Canadian pensions 12 August 2016Toronto Reporter: Barney Dixon
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Recoveries in global equities in Q2 of 2016 have brought Canadian pension plans into positive territory, according to $650 billion RBC Investor & Treasury Services All Plan Universe.
Returns in Q2 hit 2.9 percent compared to negative returns of 0.03 percent in Q1 2016, the report said.
Global equities also saw a gain of 1.6 percent in Q2 2016, compared to a loss of 6.2 percent in Q1.
Despite this recovery, market volatility continued over the course of Q2, amid uncertainty from the period surrounding the UK’s vote to leave the EU in June.
Canadian equities also remained in positive territory, with a gain of 4 percent for the median Canadian pension plan. This was down slightly, however, on Q1, which saw gains of 4.6 percent.
James Rausch, head of client coverage and banks brokers and exchanges at RBC said, “Canadian pension plan returns posted notably stronger results this past quarter, thanks largely to both global and Canadian equity holdings.”
He added: “The Canadian material and energy sectors outperformed in Q2 2016, largely offsetting a quarter of sustained market volatility and economic uncertainty globally.”
Rausch said: “Global investors will be searching for clarity regarding the UK’s exit process from the EU, which may contribute to sustained volatility over the foreseeable future.”
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