Portfolio returns: Q1 2026
| Total Return | 1M | 3M | YTD | 1YR | 3YR | 5YR | 10YR | Since Inc. (Oct 25, 2021) |
IG Climate Action Portfolio – Global Equity Balanced F | -4.41
| -0.21
| -0.21
| 12.72
| 11.58
| 5.95
| ||
Quartile rankings | 3 | 3 | 3 | 2 | 3 |
IG Climate Action Portfolio - Global Equity Balanced Series F
Q1 commentary 2026
Highlights
① The portfolio generated a positive return for the quarter.
② A lack of allocation to energy (or underweight positions in energy) detracted from performance of many of the underlying equity funds.
③ In both the U.S. and Canada, elevated yields and shifting interest rate expectations limited duration returns, while credit markets outperformed on a relative basis.
Portfolio Overview
Global markets delivered mixed results in Q1 2026, as resilient economic conditions were tempered by rising geopolitical risks, most notably the U.S.–Iran conflict. Equity performance diverged across regions: U.S. and European markets weakened, while select developed markets posted modest gains. Canadian equities outperformed, supported by strong energy and materials performance, whereas emerging markets lagged amid persistent economic and policy headwinds. A stronger U.S. dollar reduced non-U.S. returns for Canadian investors. Value stocks continued to outperform growth stocks globally and in North America, extending the trend from the prior quarter.
Commodity markets rose sharply, driven by geopolitical tensions. Oil prices surged on concerns over potential supply disruptions, particularly through the Strait of Hormuz. Gold also advanced, though with elevated volatility, supporting inflation-sensitive assets and contributing to sector dispersion.
Fixed income returns were mixed. Core government bonds were flat to weaker, as rising yields weighed on performance. In both the U.S. and Canada, elevated yields and shifting interest rate expectations limited duration returns, while credit markets outperformed on a relative basis.
The IG Climate Action – Global Equity Balanced generated a positive return for the quarter.
The Mackenzie Greenchip Global Environmental Equity Fund, Rockefeller - IG Climate Solutions Pool and the iShares ESG Advanced MSCI EAFE Index ETF were the largest contributors to performance. The Mackenzie Greenchip Global Environmental Equity Fund delivered positive returns for the quarter, outperforming its benchmark. Strong selection and an overweight position in utilities, and selection in industrials and information technology contributed the most to performance, while a lack of allocation to energy was the main detractor. The Rockefeller - IG Climate Solutions Pool generated positive returns for the quarter, outperforming its benchmark. Strong selection in financials and consumer staples and an overweight position in industrials contributed the most to performance, while a lack of allocation to energy was the main detractor. The iShares ESG Advanced MSCI EAFE Index ETF generated positive returns over the quarter, benefiting from a rotation to non-U.S. investments earlier in the quarter.
The Mackenzie Betterworld Global Equity Fund, Putnam - IG Sustainable Leaders Pool and the iShares ESG Advanced MSCI USA ETF were the main detractors to portfolio returns. The Mackenzie Betterworld Global Equity Fund underperformed its benchmark, with stock selection in health care, information technology and materials detracting the most from performance. The Putnam - IG Sustainable Leaders Pool underperformed its benchmark, primarily due to stock selection in financials and information technology, as well as an underweight position in energy.
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: constructive on equities, neutral duration stance in bonds
Our outlook for equities remains constructive, supported by a resilient U.S. economy and improving global earnings momentum, despite recent volatility from Middle East tensions. While near-term market direction will depend on the economic impact of the conflict, we remain overweight equities in the absence of a clear deterioration in corporate earnings. We favour U.S. equities over Canadian equities, reflecting stronger growth and more supportive consumer dynamics. Structural advantages in productivity and sector composition continue to support U.S. earnings, while elevated household debt and housing headwinds weigh on Canada. We also see selective opportunities in developed international markets, such as Japan, supported by corporate governance reforms and attractive valuations.
In fixed income, we maintain a neutral duration stance. Resilient U.S. economic data may delay Federal Reserve rate cuts, while softer conditions in Canada increase the likelihood of earlier easing by the Bank of Canada. Elevated geopolitical risks and higher oil prices reinforce a measured approach to bond positioning.
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