Portfolio returns: Q3 2026
| Total Return | 1M | 3M | YTD | 1YR | 3YR | 5YR | 10YR | Since Inc. (Apr 19, 2022) |
IG Mackenzie U.S. Dollar Fund – Global Equity Balanced F | -1.86
| 0.41
| 6.87
| 8.69
| 14.63
| 8.72
| ||
Quartile rankings | 1 | 1 | 2 | 3 | 2 |
IG Mackenzie U.S. Dollar Fund – Global Equity Balanced Series F
Q3 commentary 2026
Highlights
① The fund generated positive equity returns, supported by global equity exposure and favourable currency hedging.
② Global equities outperformed their benchmark, benefiting from strong security selection in financials, energy and health care.
③ Both fixed-income ETFs outperformed their benchmarks, supported by favourable yield-curve positioning despite rising bond yields.
Portfolio Overview
The IG Mackenzie U.S. Dollar Fund – Global Equity Balanced generated a positive return and outperformed its benchmark.
Global markets navigated a volatile third quarter, as resilient economic activity and corporate earnings competed with persistent inflation and geopolitical uncertainty. U.S. spending and investment remained firm, while elevated inflation prompted the U.S. Federal Reserve to raise rates by 25 basis points in September. Canadian economic activity improved, while the Bank of Canada held its policy rate at 2.25%.
Equities advanced despite rising bond yields, with U.S. stocks supported by resilient earnings. Canadian equities gained, with energy among the leading sectors, as oil prices increased, while international markets delivered mixed results. Performance varied across equity styles and sectors, with higher-beta and cyclical exposures benefiting from selective market strength.
Low-volatility equities lagged broader markets in the U.S. and Canada, with Canadian low-volatility stocks particularly affected by weakness in defensive sectors, as market leadership favoured higher-beta exposures.
Fixed income faced pressure, as persistent inflation and higher energy prices contributed to rising bond yields. U.S. Treasury and Canadian government bond yields increased, weighing on returns, particularly for longer-duration bonds. Credit markets proved comparatively resilient, while shorter-duration fixed-income exposures generally experienced less sensitivity to rising yields.
Within the current economic and market environment, the fund's global equity mandate, representing approximately 69% of the portfolio, generated a positive return and outperformed its benchmark. Information technology, energy and financials were the largest contributors to absolute performance. Strong security selection in financials, energy and health care supported relative performance, while weaker selection in information technology detracted. Regionally, U.S. equities were the largest contributors to absolute performance, followed by Japan and Germany, while Taiwan and China detracted.
Representing a 20% fixed-income allocation, the Mackenzie Canadian Strategic Fixed Income ETF declined during the quarter but outperformed its benchmark. Federal and provincial government bonds were the largest detractors from absolute performance, followed by corporate bonds. Relative outperformance was primarily driven by favourable yield-curve positioning and government-bond allocation, partially offset by weaker corporate-bond attribution.
The Mackenzie Core Plus Global Fixed Income ETF, with a 10% allocation,
also generated a negative return but outperformed its benchmark. Government bonds were the largest detractors from absolute performance, while currency forwards also weighed on returns. Relative outperformance was supported by favourable yield-curve positioning and corporate-bond attribution, partially offset by weaker government-bond positioning.
The fund's foreign currency hedging policy contributed positively to returns, with currency forward contracts providing a modest positive contribution during the quarter, while the U.S. dollar delivered mixed performance against other major currencies.
Market overview: earnings growth provided a powerful tailwind for equities
The third quarter showed that the current business cycle still has support, but risks have shifted. Growth held up, earnings improved and corporate investment remained firm, but higher oil prices, persistent inflation and rising long-term yields made the path forward less certain. Equities advanced as earnings provided fundamental support, even as higher rates raised the bar for further gains.
Canadian equities benefited from gains in resources and financials. Higher oil prices supported energy, while precious-metals companies were among the strongest performers. Bank earnings were supported by capital-markets activity, trading income and contained credit costs. U.S. equities also advanced, supported by strong earnings and continued technology investment. Higher yields weighed on more rate-sensitive areas.
International markets remained constructive overall, with parts of Asia benefiting from continued demand across the AI technology supply chain. Fixed income faced greater pressure as rising government bond yields outweighed coupon income, while credit remained comparatively resilient. Across markets, the central tension increasingly became earnings strength versus higher inflation and interest rates.
Market outlook: equities remain attractive while higher yields improve the case for duration
We remain overweight equities and sovereign bond duration. Equities continue to offer the most attractive opportunity among major asset classes, as elevated oil prices and yields have yet to materially weigh on earnings. At the same time, higher global yields, driven by rising real yields rather than longer-term inflation expectations, have improved the appeal of duration.
Within equities, we remain underweight Canada, where trade uncertainty with the U.S. and elevated financial-sector valuations remain headwinds. We favour developed Asia, particularly Japan, where attractive valuations and continued AI hardware spending are supportive, and maintain an overweight to U.S. small-caps, although conviction has been trimmed following strong performance. In currencies, the recent Canadian dollar sell-off has improved its valuation against the U.S. dollar, with elevated oil prices providing additional support. We also continue to favour the Japanese yen, which remains the most undervalued G7 currency.
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