Mackenzie Canadian Dividend Equity
Mandate commentary
Q2 2025
Highlights
① Returns were positive for the mandate. Negative stock selection in the energy sector and an underweight position in the information technology sector led to underperformance against the benchmark.
② Equities staged a sharp V-shaped recovery after tariff reversal.
③ Investors look ahead to trade-policy clarity.
Mandate overview
The mandate performed positively over the period and underperformed its benchmark index. The broader Canadian market had strong returns in the quarter. Positive stock selection in the communication services and utilities sectors contributed positively to returns relative to the benchmark. This was offset by an underweight position and negative stock selection in the information technology sector. Negative stock selection in the energy sector also detracted from relative performance versus the benchmark index.
Mandate: Overall positive returns underperforming the benchmark
Performance contributors
Positive stock selection in the communication services and utilities sectors contributed positively to relative performance over the period.
Performance detractors
An underweight position and negative stock selection in the information technology sector, and negative stock selection in the energy sector, detracted from relative performance over the period.
Total gross returns:
Total return | QTD | YTD | 1YR | 3YR | 5YR | since INC. (NOV. 14, 2016) |
MACKENZIE CANADIAN DIVIDEND EQUITY | 5.80%
| 9.19%
| 20.86%
| 11.91%
| 15.19%
| 9.26%
|
Mandate repositioning
The mandate added to its existing position in Arc Resources and initiated a new position in Alamos Gold Inc.
The mandate trimmed its position in Restaurant Brands International and exited its position in Barrick Mining Corporation.
Market overview: volatility gripped global markets during "Liberation Day" fallout
The second quarter of 2025 served as a stark lesson in the market’s ability to absorb sharp, politically driven shocks. The period was dominated by the U.S. administration's chaotic trade policy, beginning with the April announcement of sweeping tariffs, which sent global equities into a tailspin. The S&P 500 Index plunged into correction territory, marking its most significant retreat since March 2020.
This initial panic sent investors fleeing to safe havens, a move clearly reflected in the 5.7% surge in gold prices this quarter. However, the administration’s subsequent and rapid reversal of the policy triggered an equally dramatic V-shaped recovery. The initial fear that gripped the market evaporated, and major equity indices charged back into positive territory
Throughout this turbulence, central banks remained on the sidelines. The U.S. Federal Reserve (the Fed) and the Bank of Canada (BoC) held rates steady, caught between the inflationary threat of tariffs and the risk of a corresponding economic slowdown.
Market outlook: solid reasons for optimism, despite ongoing uncertainty
The world is rarely free of turmoil. Over the past five years, the world economy has faced a global pandemic, multi-decade inflation highs, aggressive interest rate hikes and significant international conflicts. Yet, despite these challenges, markets have demonstrated resilience as businesses adapt, consumers adjust, and economies discover new pathways to growth.
Looking ahead, trade policy clarity and its influence on corporate earnings will be key drivers of market sentiment. Attractive equity valuations and the potential for mid-teens earnings growth provide reasons for optimism, though uncertainty around policy and geopolitical risks remains a headwind. Central banks are expected to shift toward more accommodative monetary policy, with rate cuts anticipated in some regions. This could support economic growth while stabilizing markets, particularly in fixed income.
Persistent volatility may weigh on sentiment in the near term, especially in areas more exposed to trade tensions. However, as these risks moderate, the outlook should improve, with opportunities emerging in sectors poised to benefit from easing uncertainty. It’s important to remember that volatility, while challenging, can also create opportunities.
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