Mackenzie Ivy International Equity
Mandate commentary
Q1 2026
Highlights
① The fund underperformed the benchmark over the quarter. The largest contributors were stock selection and an underweight position in financials.
② The oil shock drove turbulence, as commodities dominated inflation fears.
③ Global growth expectations will be adjusted if conflict extends beyond summer.
Mandate overview
The fund underperformed the benchmark over the quarter. Stock selection in financials and a relative underweight position in financials were the two largest contributors to performance. Stock selection in industrials was the largest detractor to performance.
Mandate: The fund underperformed the benchmark over the quarter, with a main detractor being stock selection in industrials.
Performance contributors
Stock selection in the financials sector positively contributed to the fund’s relative performance.
Underweight allocation in financials positively contributed to the relative performance.
Performance detractors
Stock selection in the industrial sector detracted from the relative performance, as did stock selection in Europe.
Total gross returns:
Total return | QTD | YTD | 1YR | 3YR | 5YR | since INC. (NOV. 14, 2016) |
MACKENZIE IVY INTERNATIONAL EQUITY | -5.21
| -5.21
| 7.07
| 8.08
| 3.18
| 5.60
|
Mandate repositioning
The mandate added to existing positions in Terumo Corp Deutsche Boerse AG Unsponsored ADR and Novonesis, among others. The mandate trimmed positions in Hoya Corporation and Ajinomoto Co., Inc, among others.
During the quarter, the mandate added new positions in financials, health care, industrials and information technology, and exited positions in health care and consumer staples.
Market overview: oil shock drove turbulence, commodities dominated inflation fears
The first quarter of 2026 began with supportive economic momentum; improving manufacturing, a stabilizing U.S. housing backdrop and contained inflation. However, this quickly pivoted as the conflict in the Middle-East involving Iran — along with trade disruption around the Strait of Hormuz — pushed energy commodities higher. The energy shock drove volatility across global equities, yet the underlying backdrop proved more resilient than headlines implied, reinforcing the value of diversification.
Canadian equities were resilient, as higher crude oil prices supported the energy sector and helped offset weaknesses in rate-sensitive areas. Defensive sectors, dividends and real-asset exposure provided additional insulation versus many global peers. U.S. fundamentals remained solid, but sentiment weakened as oil lifted inflation expectations. Investors rotated away from expensive, rate-sensitive growth stocks, making performance more about a valuation reset than deteriorating earnings.
Market outlook: global growth expectations will be adjusted if conflict extends beyond summer
Looking ahead, oil and energy prices remain the central swing factor. A credible path to de-escalation could shift attention back to the positive economic cycle evident early in the quarter; a prolonged disruption would maintain inflation uncertainty and elevated volatility.
In this environment, commodity producers and value‑oriented equities may provide resilience, while long‑duration assets and oil‑importing regions face greater sensitivity to energy-price fluctuations.
Diversification and flexibility remain central to portfolio construction
Canadian equities offer exposure to energy and materials supported by global supply constraints. International developed and emerging markets present valuation‑driven opportunities and help diversify away from concentrated U.S. equity exposure.
Within fixed income, short‑ to intermediate-duration strategies can balance yield and interest‑rate risk, complemented by high‑quality corporate bonds for disciplined income generation. Key areas to watch will be central bank policies, as they look at the impact of higher energy costs and their indirect tax on the consumer.
To discuss your investment strategy, speak to your IG Advisor.
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