Purpose Diversified Real Asset Fund March Commentary

Market Commentary

Global stock markets were roiled by geopolitical events as Russia annexed Crimea triggering widespread condemnation of the action including Russia’s expulsion from the G-8. The U.S. Fed, now chaired by Yellen, announced a continuation of the tapering plan, with new guidelines highlighting that they would be taking a broader view than just jobs growth and inflation. They also indicated hiking interest rates beginning in 2015, a timeline which was perceived as hawkish by the market. Stock markets were generally volatile selling off mid-month and then recovering and approaching new highs by month end.

Commodities were again very active as the events in Russia continued to impact agriculture and energy exports from the region. Lean hogs were up significantly as a fatal swine disease negatively impacted production. Copper and iron ore collapsed on Chinese credit fears, while gold and silver sold off on the Fed’s hawkish guidance. Currencies saw increased volatility, with the Canadian dollar touching 1.1280 before 1.1280 before settling back down at 1.10 by month end.

Fund Commentary

The Fund was flat during the month of March as the Fund’s exposure to dividend paying equities gained from a rally in value equities, while its exposure to real assets saw mixed performance as agriculture and energy gained, but precious and base metals underperformed. The best performing commodity for the month was corn as prices increased from lower than expected crop yield forecasts. Copper was the worst performing commodity as it collapsed from weak growth in Chinese industrial activity and increasing fears of a Chinese credit bubble. Gold and Silver surged on the Ukraine crisis but subsequently sold off mid month as central banks took a hawkish tone on rates and ended the month below $1,300.

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