Purpose Duration Hedged Real Estate Fund September Commentary

Fund Highlights

  • Over the past year, the U.S. Fed has prepared the market for a long awaited interest rate hike, however they stood still on rates last month citing global economic and financial developments that put further downward pressure on inflation in the near term. As a result, U.S. yields sank lower and REITs, which had been under pressure for most of the year in anticipation of a Fed hike, experienced a brief rally after the Fed non-decision.
  • All industry sectors were positive performers this month with residential and retail providing the greatest contribution to the Fund’s return.
  • The Fund continued to hedge U.S. dollar currency exposure maintaining a net U.S. dollar exposure at approximately 7% of the Fund’s NAV.
  • The Fund had no interest rate hedge this month.
  • Market Commentary

    Global markets continued to experience volatility in September with major global equity indices ending lower on the month. China remained in sharp focus as declining manufacturing and worsening economic data stoked further deflationary fears. Over the past year, the Fed has prepared the market for an imminent interest rate hike, however they stood still on rates this month citing global economic and financial developments that put further downward pressure on inflation in the near term. With much uncertainty surrounding the outlook for global growth, risk was pared back notably across cyclical sectors. Commodity prices fell led by energy and metals. In currencies, commodity currencies were broadly sold with the loonie making new lows on the year.

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