Canadian plan sponsors maintain positive return trend in Q2

TORONTO, July 31, 2024 /CNW/ - The median return of the BNY Canadian Asset Strategy View universe, a BNY Global Risk Solutions fund-level tracking service, was 1.14% for the second quarter of 2024. The one-year median return as of June 30, 2024, was 10.10%, while the median 10-year annualized return was 6.63%.

The BNY Canadian Asset Strategy View universe results are based on $308 billion worth of investment assets in Canadian investment plans, with the average plan size of $4.0 billion. The universe is designed to provide peer comparisons by plan type and size, and it comprises 77 Canadian corporate, public and university pension plans. Additional insight into the plan results is provided by BNY's Asset Strategy View sub asset class universes.

"Canadian pension plans experienced modest positive returns in Q2, despite volatility in financial markets driven by geopolitical tensions and central bank policies affecting investor sentiment and asset prices across major indices," said David Cohen, Director of Global Risk Solutions, BNY. "Despite a rough start to the quarter, both Equity and Fixed Income segments ended with generally positive returns, continuing their strong performance for 2024. Private Asset classes remain resilient, providing additional support to Q2 returns."

Among traditional asset classes, International Equity posted the highest performance, with a quarterly median return of 2.44%. Canadian Equity returns were the lowest, posting a negative quarterly return of -0.45%.

With respect to non-traditional asset classes, Hedge Funds delivered the strongest performance, with a quarterly median return of 3.16%. Private Equity ended the quarter with a median return of 3.08% while Real Estate delivered a flat performance for the quarter returning 0.33%.

• The BNY Asset Strategy View universe of Canadian pension plans over $1 billion outperformed the median return of the Total Canadian Asset Strategy View Universe in Q2 2024.
• Canadian Foundations and Endowments posted a median performance of 1.70% for the second quarter exceeding both Public Pension Plan and Corporate Pension Plan universes.
• Most major equity segments posted positive returns in Q2.
• • Canadian Equity posted a negative median return of -0.45% in the second quarter, slightly ahead of the S&P/TSX Composite Index return of -0.53%.
  • U.S. Equity posted a quarterly median return of 1.18%, lagging the S&P 500 Index return of 5.45%.
  • Global Equity reported a median return of 2.01% in Q2, underperforming the MSCI World Index return of 3.93%.
  • International Equity posted a quarterly median return of 2.44%, exceeding the MSCI EAFE Index return of 0.95%
• Emerging Markets Equity posted a positive median performance for the quarter of 5.13%, lagging the MSCI Emerging Markets Index return of 6.29%.
• The Canadian Fixed Income median return was 0.80% in the second quarter of 2024. Fixed Income underperformed relative to the FTSE Canada Universe Bond Index for the quarter, which returned 0.86%.
• Private Equity reported a positive quarterly median return of 3.08% for the second quarter, Real Estate reported a quarterly median return of 0.33%. Hedge Funds reported a return of 3.16%.

About CIBC Mellon

CIBC Mellon is a Canadian company exclusively focused on the investment servicing needs of Canadian institutional investors and international institutional investors into Canada. Founded in 1996, CIBC Mellon is 50-50 jointly owned by The Bank of New York Mellon (BNY) and Canadian Imperial Bank of Commerce (CIBC). CIBC Mellon's investment servicing solutions for institutions and corporations are provided in close collaboration with our parent companies, and include custody, multicurrency accounting, fund administration, recordkeeping, pension services, exchange-traded fund services, securities lending services, foreign exchange processing and settlement, and treasury services. As at June 30, 2024, CIBC Mellon had more than C$2.8 trillion of assets under administration on behalf of banks, pension funds, investment funds, corporations, governments, insurance companies, foreign insurance trusts, foundations and global financial institutions whose clients invest in Canada. CIBC Mellon is part of the BNY Mellon network, which as at June 30, 2024, had US$49.8 trillion in assets under custody and/or administration. CIBC Mellon is a licensed user of the CIBC trade-mark and certain BNY trade-marks, is the corporate brand of CIBC Mellon Global Securities Services Company and CIBC Mellon Trust Company, and may be used as a generic term to refer to either or both companies.

Information containing any historical information, data or analysis should not be taken as an indication or guarantee of any future performance, analysis, forecast or prediction. Past performance does not guarantee future results. The Information should not be relied on and is not a substitute for the skill, judgment and experience of the user, its management, employees, advisors and/or clients when making investment and other business decisions. None of the Information constitutes an offer to sell (or a solicitation of an offer to buy), any security, financial product or other investment vehicle or any trading strategy. Some products or services are available only through BNY.

For more information, including CIBC Mellon's latest knowledge leadership on issues relevant to institutional investors active in Canada, visit www.cibcmellon.com.

Media Contact:

Alexandra DeCata, Corporate Communications, CIBC Mellon, 416-643-6126, alexandra.decata@cibcmellon.com

SOURCE CIBC Mellon