Portfolio returns: Q3 2025
| Total Return | 1M | 3M | YTD | 1YR | 3YR | 5YR | 10YR | Since Inc. July 12, 2013 |
IG Core Portfolio – Income Plus F | 2.73
| 4.60
| 8.45
| 9.24
| 9.95
| 4.91
| 4.50
| 4.57
|
Quartile rankings | 1 | 1 | 1 | 1 | 1 | 1 | 2 |
IG Core Portfolio – Income Plus Series F
Q3 commentary 2025
Highlights
① The portfolio appreciated during the quarter, led predominantly by strong equity performance.
② Canadian equities were the top contributor to returns, followed by Canadian bonds.
③ Real properties slightly detracted from returns.
Portfolio Overview
Global markets advanced in Q3 2025, fuelled by strength in AI-themed stocks, easing trade tensions and central bank rate cuts. The U.S. Federal Reserve and Bank of Canada each cut rates by 25 basis points (a quarter percentage point), citing slowing job growth. U.S. equities hit record highs, led by AI-technology and small-cap stocks. Canadian markets benefited from strength in materials, information technology and energy sector stocks. Emerging markets surged, fuelled by Chinese technology stocks and a weaker U.S. dollar. Gold rallied to historic highs, while oil prices dipped on soft demand and rising supply. Bond markets saw modest gains; high-yield bonds outpaced investment grade bonds, with emerging market bonds another beneficiary of a softer U.S. dollar.
The IG Core Portfolio – Income Plus generated a positive return, with equities as the top contributing asset class, followed by fixed income, while real property slightly detracted.
The Mackenzie Canadian Equity Pool, the Mackenzie - IG Canadian Bond Pool and the Mackenzie Broad Risk Premia Collection Fund were the largest contributors to performance. The Mackenzie Canadian Equity Pool generated a positive return, benefiting from a strong performance in materials and financials sector stocks. The pool outperformed its benchmark, aided by an underweight allocation to the industrials sector and security selection in financials and information technology sector stocks. The Mackenzie - IG Canadian Bond Pool gained this quarter and outperformed its benchmark, led by security selection in federal government bonds and duration management across government and corporate bonds. The Mackenzie Broad Risk Premia Collection Fund, an alternative strategy fund that combines equity exposure with multiple alternative strategies in a capital-efficient manner, contributed to portfolio returns, as alternative strategies outperformed.
The IG Mackenzie Real Property Fund was the sole detractor, and the Mackenzie Enhanced Fixed Income Risk Premia Fund was the smallest contributor to portfolio returns. The IG Mackenzie Real Property Fund posted a negative return, due to the markdown of values of two office properties and the reclassification of a retail property from income-producing to development land. However, the fund’s operating metrics remained strong, with rental revenue, net operating income and vacancy rates all trending positively over the period. The Mackenzie Enhanced Fixed Income Risk Premia Fund is a levered alternative fixed income fund. The investment team uses the fund to efficiently manage total portfolio fixed income exposure. Falling bond yields led to rising bond prices and were beneficial to fixed income returns.
Market overview: signs of optimism emerge, despite the noise during "Liberation Day" fallout
The third quarter delivered broad gains across asset classes, with market performance largely overriding a backdrop of cautious sentiment. Investors looked past persistent trade policy headlines, increasingly treating the U.S. administration's tariff policy as noise rather than a core risk. The primary catalysts for the positive performance were a subtle shift toward lower-interest-rate expectations and resilient corporate earnings.
Signals from the U.S. Federal Reserve of imminent rate cuts were followed by a quarter percentage cut in September. Government bond yields eased into the quarter's end, supporting bond prices, while corporate bonds outperformed government bonds.
Market outlook: Positive on equities, diversified globally, selective in bonds.
Our outlook for equities became positive in the period, as global markets proved resilient, with improving earnings revisions and stronger investor sentiment. We believe share valuations in Japan remain reasonable, and longer-term metrics suggest that developed international and emerging markets are more attractively valued than those in the United States and Canada.
We believe policy uncertainty and slower global growth are likely to cap inflation. Because tariff-related price increases appear transitory, we do not expect a lasting impact on fixed income investments. In Canada, we believe softer economic data has increased the likelihood of additional Bank of Canada policy rate cuts. In the United States, a more accommodative tone from the U.S. Federal Reserve and mounting fiscal and debt concerns led markets to price in further interest rate cuts into 2026, which we believe could pressure the U.S. dollar.
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