Tag Archives: Canadian equities
Canadian Equities Go the Way of Global Equities
There has been no shortage of macroeconomic headwinds in 2022. Canadian equities were an exception in posting gains for the first three months of the year, but they have since fallen in step with most global equity markets. The S&P/TSX Composite Index lost 12.07% since its last rebalance on March 17, 2022. Uncommonly, the S&P/TSX…
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Canadian Equities Offer Some Solace amid World Turmoil
Despite global geopolitical tensions, Canadian equities, in contrast to U.S. equities, seem to be faring well. Since its rebalance on Dec. 17, 2021, the S&P/TSX Composite gained 5.7% (through March 17, 2022). It was no surprise that the S&P/TSX Composite Low Volatility Index lagged—what was surprising was that it lagged by 1.3%, rising 4.4% over…
Highlights of the SPIVA Canada Year-End 2020 Scorecard
Although 2020 was a year that offered ample opportunities for stock pickers to shine, most Canadian active fund managers in five of the seven categories tracked by the SPIVA® Canada Year-End 2020 Scorecard underperformed their benchmarks over the past year. The Canadian equity market was not spared from the COVID-19 shock in 2020. Nevertheless, major…
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So Different Yet So Alike…
To say that the world is different now than it was a year ago would be an astounding understatement. COVID-19 brought about once unimaginable conditions and changes. In the financial realm, market volatility spiked and remains markedly higher across all sectors compared to the beginning of 2020. Yet, observing the market based purely on performance,…
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The Challenge of Finding Outperforming Active Funds in Canada
The SPIVA® Canada Year-End 2019 Scorecard was released recently. Despite the strong performance of broad equities, 2019 proved to be yet another challenging year for active funds in Canada. Here are a few highlights from the report. Strong Market Performance Did Not Translate to Active Fund Outperformance The S&P/TSX Composite posted its highest annual return…
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Pandemic Affects Canadian Sectors Differently: Evidence from the Information Technology Sector
The S&P/TSX Capped Information Technology Index gained a whopping 62% in 2019, topping all other Canadian equity sectors and beating the broad market S&P/TSX Composite by about 40%. Given the traditionally cyclical nature of the Information Technology sector and its outsized gains during the bull market, the sector might be expected to lag during the…
The Virtue of Protection
It remains to be seen what the full economic impact of the COVID-19 virus will be, but it is already clear that no equity market has escaped unscathed. (In fact, most of them have been scathed rather badly.) The Canadian equity market was humming along in 2020 through February 20, 2020, with the S&P/TSX Composite…
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2020, defensive strategies, Factor, factor analysis, factor investing, factor-based strategies, Fei Mei Chan, Index Investment Strategy, institutional investor, low volatility, low volatility strategies, risk management, S&P/tsx composite low volatility, smart beta, smart beta strategies, strategic beta, strategy index
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- 2020, defensive strategies, Factor, factor analysis, factor investing, factor-based strategies, Fei Mei Chan, Index Investment Strategy, institutional investor, low volatility, low volatility strategies, risk management, S&P/tsx composite low volatility, smart beta, smart beta strategies, strategic beta, strategy index
Raising the Bar in Canadian Small Caps
Prior research has demonstrated that profitability matters for small-cap companies in the U.S. and in global equity markets. For example, the S&P SmallCap 600®—which includes an earnings eligibility criteria—has outperformed the broader Russell 2000 Index (with lower volatility) over its 25-year track record. Our new S&P/TSX SmallCap Select Index extends this phenomenon to Canadian equities,…
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Why Taking a Local Approach to Index Construction Matters in Canada
While nearly everyone in the Canadian investment community has heard of the S&P/TSX Composite, few are aware of the key methodological intricacies that distinguish it from other broad market Canadian equity benchmarks. The most notable distinction is that the S&P/TSX Composite is designed specifically for Canadians (as are all S&P/TSX Indices), while many other Canadian…
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S&P/TSX 60 2019 Gains Boosted by Exposure to the U.S.
The S&P/TSX 60 gained 15.5% YTD[i] and many companies included in the index have benefitted from business prospects in the U.S. While nearly all stocks in the index are domiciled in Canada, 49%[ii] of combined revenues come from within Canada’s borders, while another 30% are sourced in the U.S. As shown in Exhibit 1, stocks…
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