Tuesday April 14th, 2015
The Fund holds a diversified portfolio of high quality U.S. companies that have shown a capacity to grow and pay their dividends.
The Fund was negative in March, as U.S. stock markets pulled back after rallying the previous month. The Fed pushed back expectations of a rate hike this year stating concerns over moderating growth which made for a choppy trading range.
The Fund’s best performing sectors were consumer discretionary, real estate and tech. The top names were Western Union, General Mills and Starwood Hotel.
The worst performing sectors were energy, utilities and industrials. The names that underperformed were Murphy Oil, Cisco and General Electric.
The portfolio holds 40 U.S. names and hedges USD currency exposure maintaining a net USD exposure at approximately 10% of the Fund’s NAV.
North American markets stalled after rallying the previous month and ended lower in March. There was much focus on the FOMC meeting this month with many expecting a strong push for a rate hike later this year in light of continued strong job growth. As anticipated, the Fed removed the word “patient” from its statement, however there were some dovish undertones that resulted in a rally in bonds as the outlook for a potential hike was pushed back.
In commodities, oil tested new cycle lows near $40, but managed to bounce into month end on the back of rising Middle East tensions as Saudi Arabia was drawn into the conflict in Yemen.
The USD dollar continued to grind higher, especially against Eurozone currencies. CAD saw further weakness, despite rates being kept on hold, as the Bank of Canada warned of economic slowdown resulting from the shock in oil prices.