Portfolio returns: Q4 2025
| Total Return | 1M | 3M | YTD | 1YR | 3YR | 5YR | 10YR | Since Inc. (Jul 13, 2015) |
IG Low Volatility Portfolio – Income Balanced F | -0.66 | 1.16 | 10.56 | 10.56 | 11.43 | 7.17 | 6.57 | 6.34 |
Quartile rankings | 3 | 2 | 2 | 2 | 2 | 1 | 1 |
IG Low Volatility Portfolio – Income Balanced Series F
Q4 commentary 2025
Highlights
① The portfolio gained in Q4 2025, driven by broad-based equity strength.
② Canadian and European equities were top contributors, led by materials, health care and consumer discretionary sector exposure.
③ Higher yield levels helped deliver positive bond returns.
Portfolio Overview
Global markets delivered positive returns in Q4 2025, as easing inflation pressures and more stable financial conditions supported risk sentiment. Equity performance varied across regions, with strong gains in several developed markets, while China lagged amid ongoing economic and policy challenges. Canadian equities outperformed U.S. markets, supported by cyclical exposures and improved global risk appetite. Meanwhile, a softer U.S. dollar made non-U.S. investments more attractive. Value stocks outperformed growth across global and North American markets. In commodities, gold and silver performed exceptionally well amid lingering macro and geopolitical risks, while oil prices declined on concerns over excess supply. In this risk-on environment, traditional low-volatility strategies underperformed, as equity volatility remained subdued, and defensive equities lagged. Fixed income markets delivered modest gains overall, supported by higher levels of yields in several global markets. In local currencies, the U.S. bond market outperformed the Canadian bond market, due to changes in rates and a higher level of bond yields.
IG Low Volatility – Income Balanced generated a positive return this quarter on the backdrop of strong global equity performance.
Among equities, the Mackenzie IG Low Volatility Canadian Equity Pool, the IG Mackenzie European Equity Fund and the Mackenzie Canadian Dividend Fund were top contributors to performance. The Mackenzie IG Low Volatility Canadian Equity Pool was the largest contributor, outperforming its benchmark, due to strong security selection in the materials and consumer discretionary sectors, as well as overweight positions in health care and materials. The IG Mackenzie European Equity Fund was the second-largest contributor, benefiting from strong selections in health care and consumer discretionary sectors, though it modestly trailed its benchmark due to an underweight position in financials and selection in information technology sectors. The Mackenzie Canadian Dividend Fund also contributed positively, led by strength in industrials and information technology holdings.
Within fixed income, the iShares Core U.S. Aggregate Bond ETF was the leading contributor. The ETF performed well due to its broad exposure to high-quality investment-grade bonds and steady income. In Q4 2025, U.S. yields were mostly flat, and credit conditions remained relatively stable.
The IG Mackenzie Real Property Fund posted a slightly negative return due to weaker office property performance, which pressured property valuations. This was partially offset by strong income and occupancy from industrial, retail and multi-family properties.
Market overview: global growth strengthened, inflation eased, policy supportive
Markets ended the fourth quarter of 2025 on a strong note, capping a year defined by resilience and broad-based gains. Equities led performance, as investors looked beyond policy noise and focused on improving fundamentals. Global markets advanced, supported by steady corporate earnings, easing inflation pressures and a clear shift toward lower interest rates. Canada outperformed most developed peers, driven by strength in materials and financials, while European and Asian markets rebounded on firmer trade activity and renewed investor confidence. In the U.S., equity performance remained positive, led by technology and communication services, with improving breadth across sectors signalling a healthier market foundation.
Fixed income delivered modest but positive returns, as central banks continued to ease policy. Government yields declined on the short end while longer maturities remained stable, allowing coupon income to drive returns. Credit conditions stayed firm, underscoring the strength of corporate balance sheets entering 2026.
Market outlook: a focus on fundamentals amid market uncertainty
While geopolitical tensions remain elevated, and markets are being tested by concerns over U.S. Federal Reserve independence, we remain focused on business fundamentals that ultimately drive earnings and equity performance. More accommodative monetary policy in 2025 is likely to continue supporting global equities going forward. We believe Canadian equities are well positioned for 2026, in part due to their favourable industry composition.
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