Canadian pension returns post slight gain
May 10, 2018
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Canadian defined benefit pension plans remained in positive territory in Q1 2018, according to the RBC Investor & Treasury Services All Plan Universe, which RBC defines as the industry's most comprehensive universe of Canadian pension plans.

Q1 2018 returns were 0.2 percent, down from Q4 2017 returns of 4.4 percent. Pension returns were 2.9 percent in Q1 2017. Canadian equities were greatly impacted during the quarter, posting a -3.9 percent loss, compared to gains of 4.2 percent and 2.3 percent in Q4 2017 and Q1 2017 respectively.

The TSX Composite Index followed a similar trend, posting a -4.5 percent loss during the quarter compared to a 4.5 percent gain in Q4 2017 and 2.4 percent in Q1 2017.

Global equities retreated, returning 2 percent in Q1 2018, a decrease from 6.1 percent a quarter earlier. The MSCI World Index returned 1.6 percent in Q1 2018, down from 5.7 percent in Q4 2017 and 5.8 percent in Q1 2017.

"The first quarter of 2018 was full of instability and volatility, with Canadian equities taking the biggest hit," said Ryan Silva, Director, Head of Pension and Insurance Segments, Global Client Coverage RBC Investor & Treasury Services.

"The healthcare and energy sectors, uncertainty around NAFTA trade negotiations as well as potential interest rate hikes weighed down the TSX Composite Index and other key indices. Geo-political concerns, coupled with international trade and interest rate anxieties also impacted global equity returns.

"Asset managers should remain vigilant to ongoing volatility for the remainder of the year, and maintain a diversified portfolio to actively manage their risk exposure."

The NAFTA trade negotiations and potential interest rate hikes also impacted additional returns. Canadian fixed income assets posted a small return of 0.1 percent in Q1 2018, compared to 2.2 percent in Q4 2017 while the FTSE TMX Universe Canadian Bond Index returned 0.1 percent in Q1 2018, down from 2 percent in Q4 2017.

 





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Canadian defined benefit pension plans remained in positive territory in Q1 2018, according to the RBC Investor & Treasury Services All Plan Universe, which RBC defines as the industry's most comprehensive universe of Canadian pension plans.

Q1 2018 returns were 0.2 percent, down from Q4 2017 returns of 4.4 percent. Pension returns were 2.9 percent in Q1 2017. Canadian equities were greatly impacted during the quarter, posting a -3.9 percent loss, compared to gains of 4.2 percent and 2.3 percent in Q4 2017 and Q1 2017 respectively.

The TSX Composite Index followed a similar trend, posting a -4.5 percent loss during the quarter compared to a 4.5 percent gain in Q4 2017 and 2.4 percent in Q1 2017.

Global equities retreated, returning 2 percent in Q1 2018, a decrease from 6.1 percent a quarter earlier. The MSCI World Index returned 1.6 percent in Q1 2018, down from 5.7 percent in Q4 2017 and 5.8 percent in Q1 2017.

"The first quarter of 2018 was full of instability and volatility, with Canadian equities taking the biggest hit," said Ryan Silva, Director, Head of Pension and Insurance Segments, Global Client Coverage RBC Investor & Treasury Services.

"The healthcare and energy sectors, uncertainty around NAFTA trade negotiations as well as potential interest rate hikes weighed down the TSX Composite Index and other key indices. Geo-political concerns, coupled with international trade and interest rate anxieties also impacted global equity returns.

"Asset managers should remain vigilant to ongoing volatility for the remainder of the year, and maintain a diversified portfolio to actively manage their risk exposure."

The NAFTA trade negotiations and potential interest rate hikes also impacted additional returns. Canadian fixed income assets posted a small return of 0.1 percent in Q1 2018, compared to 2.2 percent in Q4 2017 while the FTSE TMX Universe Canadian Bond Index returned 0.1 percent in Q1 2018, down from 2 percent in Q4 2017.

 



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