Page and Associates Ltd.

Family Wealth Management

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Patience will be Rewarded, Active Managers Still Beating the Benchmark

The below chart highlights the returns from May 1st, 2007 until yesterday’s close – a period of roughly 15 Years. This includes the Global Financial Crisis, the COVID-19 Pandemic, and countless corrections/world events in between.

We’ve shown the returns of 3 of Fidelity’s flagship equity strategies against the S&P 500 and TSX over that time period. Their returns against the indices have been staggering and serve as a reminder that not all active managers are created equal. We believe that Portfolio Managers Mark Schmehl and Dan Dupont have proven themselves as the “elite of the elite”, which is why they have been on our preferred managers list for some years already.

Volatility is part of investing; perhaps some investors have forgotten that over the past 3 years. Rather than trying to figure out when/how it will end — use downturns as an opportunity to add/diversify for clients with the appropriate time horizon and stick to your investing principles. Patience is the ultimate path to success.

15 Years of Returns: Fidelity Special Situations, Canadian Growth Company, and Canadian Large Cap

Source: Fidelity Investments Canada ULC

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Portfolio Benchmarks to 2022 April 30

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Each month-end we publish total return data for various investment market indices, as well as a composite portfolio return benchmark for model portfolios of three different asset allocations. These may be useful guides to reasonable performance of your own portfolio or its components.

Click to view the Index Return Table.

Click to view the Portfolio Benchmarks.

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Noah Blackstein – interviewed on CNBC 2022 May 5

Noah Blackstein, Portfolio manager at Dynamic Funds, interviewed on CNBC.

“The Market got ‘carried away’ with 75 basis point rate hike” says Dynamic Funds’ Noah Blackstein in this interview on CNBC.

Key Points
Were you surprised by what the Fed did yesterday? Was this your expectation ahead of hearing Jay Powell say that 75 basis points was not on the table right now?

  • The market got really carried away with 75 basis points; we’re still starting quantitative tightening with at least two 50 basis point hikes coming
  • Re: move in Treasury yields and mortgage rates year-to-date: mortgage rates are up almost 70% year-to-date, there is no way that a 70% move in mortgage rates isn’t going to have an impact but real estate has a much longer lag than stocks
  • “In the relative asset game, mortgages and housing have a much larger and more significant impact on the overall economy; dialing it back a little bit is not unwarranted and being a little more data dependent is certainly not unwarranted at all”

The markets have moved significantly over the last several days. You saw a nine hundred points plus move yesterday, and that was the third day in a row of gains for the markets. But it really just got us back to last Thursday. Have you been a buyer on the dips that we’ve seen the last several weeks?

  • It’s been a very tough market for legitimate growth managers since the macro took over in November, the S&P 500 is still about 7% off of where it was on the March rally
  • Looking at growth stocks today, relative valuation multiples (an area of primary focus for Noah) are at some of the lowest levels since 1980
    Will look to take advantage of awful sentiment (worst Nasdaq start since 2001, worst month for Nasdaq since 2008, worst month for the S&P since the pandemic) and focus on the many catalysts for a move higher (passing peak inflation has been good for markets, and we probably passed peak inflation in March)

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Edgepoint Commentary

Portfolio managers believe investors should be excited that the market is on sale – why doesn’t the media position it this way? Investors who have a medium time horizon will likely look back on this period as a buying opportunity. “Many investors will see declines in fixed income portfolios and allow their fear of loss to force them to sell their holdings. We want to buy from them.”

Read more:
https://www.edgepointwealth.com/article/earning-our-wings-1st-quarter-2022/