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Fund Overview

This fund is designed for investors who …

  • Have a more aggressive participant profile with a long-term investment horizon.
  • Have a low to medium tolerance to risk.

Investment Objectives

  • Achieve a return comprised mostly of long-term capital growth and also of a steady income.
  • Invest primarily in equity securities of Canadian and foreign issuers and in debt instruments of Canadian and foreign issuers.

Fund Facts are published once a year. Read them now.

Summary

Volatility

Low / Average

Category: Canadian Income Balanced
Start Date: April 30, 2001
RRSP Admissibility: Yes, 100% eligible

Benchmark:

  • 25% S&P/TSX Composite Index
  • 40% MSCI World (in CA$)
  • 30% DEX short term/mid-term
  • 5% 91-day Treasury Bonds

Assets*: $274,647,013
Number of Securities: 24
Target Asset Mix:

  • International Equities: 41.5%
  • Bond & Fixed Income : 16.2%
  • Canadian Equities: 21.2%
  • American Equities: 16.1%
  • Cash & Equiv.: 4.9%

*As at April 30, 2023

Portfolio Management

Managers

  • Professionals’ Financial – Mutual Funds Inc.

The Funds’ Investment Policies are developed by the Fund Manager’s Investment Committee, which meets regularly to make any necessary changes. The Committee includes both internal and external investment experts, as well as representatives of professional association shareholders.

Main Securities as at September 30, 2023

FDP Global Equity Portfolio 21.8%
FDP Canadian Equity Portfolio 15.2%
iShares Core MSCI EAFE ETF 14.1%
SPDR S&P 500 ETF Trust 10.0%
FDP Canadian Bond Portfolio 7.1%
Government of Canada, 2.25%, Jun. 01, 2029 6.0%
Cash and Cash Equivalents 5.1%
iShares Core MSCI Emerging Markets ETF 4.6%
Invesco QQQ Trust, Series 1 4.5%
iShares S&P/TSX 60 Index ETF 3.9%
FDP Global Fixed Income Portfolio 2.5%
Invesco S&P 500 Equal Weight ETF 2.5%
iShares Core S&P/TSX Capped Composite Index ETF 1.9%
FDP Emerging Markets Equity Portfolio 0.7%
Net asset value as at September 30, 2023 270 M $

Returns

Returns *

* Returns for the first and last year are not annualized

* Non annualized return

$1,000 Invested Amount since inception

Note that the results shown are for information purposes only. Commissions, trailing commissions, management fees and expenses all may be associated with investments ins FDP Portfolio’s. Please read the prospectus before investing. The indicated rates of return are the historical annual compounded total returns, including changes in portfolio value and reinvestment of all distributions, but do not take into account sales, redemption, distribution or optional charges or income taxes payable by an investor that would have reduced returns. References to indices are for information purposes only. Comparisons with indices may vary according to the portfolio size, investment timing, and mandate objective.  The funds’ securities are not insured by the Canada Deposit Insurance Corporation. Mutual funds are not guaranteed, their value changes frequently, and past performance may not be repeated.

Managers' Comments

The Managers’ Comments are taken from the Annual Management Report of Portfolio Performance (Operating Results), as at December 31, 2022.

The FDP Balance Growth Portfolio, Series A posted a net return of -10.4% for 2022, versus 12.1% for 2021.

The bond market, as measured by the FTSE Canada Universe Bond Index, posted a -11.7% return. The negative performance of the index was mainly attributable to rising interest rates driven by persistent high inflation. Recession fears also weighed heavily on corporate bonds.

The 10-year government of Canada bond yield climbed from 1.43% to 3.30% in 2022. While the 10-year yields increased substantially, short-term yields appreciated even more, causing the yield curve to invert. Both provincial and corporate credit spreads widened in 2022 amid slowing economic growth and soaring inflation.

Rate hikes and a potential recession had a negative effect on the Canadian market in the first six months of 2022. The Canadian stock market, as measured by the S&P/ TSX Composite Index, posted a -5.8% return for 2022. Only four of the index’s eleven component sectors posted positive returns for the period, including Energy (+30.3%) and Consumer Staples (+10.1%). Meanwhile, all the other component sectors of the index closed the period in negative territory, chiefly Health Care (-61.6%), Information Technology (-52.0%, mostly due to the sharp drop of Shopify) and Real Estate (-21.5%). Oil prices (WTI) soared from USD75.30 in late December 2021 to USD107.80 as at June 30, 2022, before dropping to USD80.30 by the end of the year. Moreover, value-style securities substantially outperformed their growth-style counterparts during the period, with each posting a 7.4% and -8.2% return, respectively.

The U.S. stock market, as measured by the S&P 500 Index, posted a net return of -12.2% in Canadian dollars for 2022. In turn, the Canadian dollar, like many other global currencies, weakened by 6.8% relative to the U.S. dollar, which bolstered returns for Canadian investors. Value-style securities outperformed their growth-style counterparts during the year, with each posting a -5.3% and -29.4% return, respectively. Only two of the index’s eleven component sectors posted positive returns, with Energy (+65.8%) leading the pack, bolstered by oil prices and the war in Ukraine. Utilities also posted positive returns (+1.4%). Conversely, Consumer Discretionary (-37.0%) and Communication Services (-39.9%) were the worst- performing sectors.

All eurozone markets (MSCI Europe Index) yielded negative returns of -8.9% and Asian markets returned -11.2% (MSCI AC Asia Pacific Index), while emerging markets (MSCI Emerging Markets Index (CAD)) fell by 14.3% in Canadian dollars.

Against this backdrop, the portfolio manager slightly reduced the FDP Balanced Growth Portfolio’s allocation to equities, while maintaining a larger cash position within the fixed-income portion of the portfolio.

The FDP Balanced Growth Portfolio, before management fees, added value relative to the benchmark due to an overweight to equities along with an underweight to bonds. In terms of geographic allocation, the overweight to Canadian equities and underweight to U.S. equities contributed a few percentage points. Stock selection in Canadian equities detracted the most from returns, while selection in global equities contributed.

Equities’ rise—an upward trend that started in 2020—was finally slowed by inflation, the labour shortage, rising interest rates and the fear of an economic slowdown. The FDP Balanced Growth Portfolio was especially affected by the performance of Canadian and global equities and of fixed-income securities, since all major asset classes posted negative returns.
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