Hurricane turmoil kept the energy-heavy Canadian stock market surging, boosting one-year pension investment returns to 15.1 per cent, according to a survey just released by BENCHMARK, the investment analytics arm of RBC Global Services.
Within the $340 billion BENCHMARK universe, balanced funds earned 3.8 per cent in the three months ending September 2005. Canadian stocks provided most of the gains, as the S&P TSX composite index jumped 11.6 per cent in the quarter and 29.3 per cent for the year.
“Again this quarter, the energy sector alone accounted for half the returns. Canadian energy shares are up 25.7 per cent and a remarkable 78.9 per cent over the year,” explained Don McDougall, director, BENCHMARK, RBC Global Services. “However, as prices soared, equity managers generally reduced their exposure – and consequently lagged the S&P/TSX index by 0.6 per cent for the quarter.”
“The energy boom has also driven up the loonie, erasing global portfolio gains for Canadian-based investors,” noted McDougall. “Our strengthening dollar slashed foreign equity returns to just 0.4 per cent for the quarter, once currency was taken into account”.
Domestic bond portfolios were flat, gaining a meager 0.2 per cent in the latest quarter and 9.0 per cent over the year, closely in line with the Scotia Capital Universe Bond Index.