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The first quarter of 2018 is now over and, despite the turbulence that marked the financial markets during this period, our management style―which focuses above all on investment quality―enabled us to generate a superior return with less volatility than the market indexes.

Our clients’ portfolios therefore performed relatively well compared with the benchmark indexes and in the Morningstar ratings.

An encouraging quarter

According to these ratings, 11 of our 13 mutual funds―i.e. 85%―ranked above the Morningstar median in the first quarter. Considering the market conditions, this is an excellent result! If we look at the ratings of our funds over a one-year horizon, 69% of our funds, or 9 of our 13 funds, rank above their median; over a three-year horizon, this ratio is 61.5% and over five years, it rises to 83.3%.

Funds that stand out

Some of our funds performed particularly well in the first quarter:

  • The FDP Balanced Portfolio outperformed 90% of the funds in its Morningstar category and finished in tenth place (first decile), exceeding by close to 1% the average return of the other funds.
  • The FDP Canadian Equity Portfolio and the FDP Canadian Dividend Equity Portfolio also outperformed 90% of the funds in their category and ranked in the first decile―respectively 9th and 10th―in the Morningstar ratings. The returns of these funds largely exceeded the average of the other funds in their peer group (+1.5%).
Our external managers: added value

The external managers to whom we entrusted the mandate of managing the FDP Canadian Equity Portfolios all outperformed the S&P/TSX Index significantly.

In the case of the FDP Canadian Equity Portfolio, the value added by the managers relative to the S&P/TSX Index was as follows:

  • Triasima: +3.16%
  • Fidelity Investments Ltd.: +1.4%
  • Manulife Asset Management: +3.5%

As for the FDP Canadian Dividend Equity Portfolio, the added value generated by the external managers was as follows:

  • Lincluden: +0.6%
  • Beutel Goodman & Co. Ltd: +2.3%
  • Manulife Asset Management: +3.5%

Lastly, the manager Fidelity Investments Ltd. added 6% to the value of the FDP Dynamic Canadian Equity Private Portfolio relative to the benchmark index.

A good quarter for Private Management!

As far as our Private Securities Management is concerned, the Canadian equity model portfolios also generated added value relative to the S&P/TSX benchmark index:

  • For the income approach, Lincluden added +0.7%.
  • For the growth approach, Beutel Goodman & Co. Ltd. added +1.8%.
  • For the dynamic approach, Desjardins Global Asset Management (DGAM) added +0.2%.
Global equities up

Lastly, for the quarter, all the funds in our range of funds that are invested in foreign equities (FDP US Dividend Equity Portfolio, FDP US Index Equity Portfolio, FDP Global Equity Portfolio, FDP Emerging Markets Equity Portfolio) ranked in the second quartile of the Morningstar ratings.

Quite a performance!

The first quarter results are very encouraging. Backed by the targeted expertise of our external managers in certain specific sectors, we are building on our success and remain on the lookout for the best market opportunities. We seek to invest in solid companies that can weather the different economic cycles and that stand out for their strong growth potential.

François Landry, CFA
Senior Vice-President and Chief Investment Officer

Source: Bloomberg

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