Good morning. Everyone I'm Sophie, TN investment sales manager presenting the December. What's up with our find suggestion for this webinar is to help. Mean you I'm afraid to understand what our house muana housing market effects our performance. And also the target audience is for new MFA who wants a refresher about our funds. Please remember to listen to this webinars through your air buds or headphones, speakers, and also remember to complete the survey. At the end of the web and R. There's couple housekeeping, so please press F5 if you experience any buffering issues and also type your questions in the Q&A Button and you can find. The investment monthly on the SharePoint under half it and also comment on the resource link where the MFA confined link to the. Invite some monthly and also performance highlight document. OK so let's do a full question wouldn't think the news move the market in November. So I'm going to wait a couple of seconds before we move on to the next slide. Alright so let's move on to the next slide. Uh for the investment monthly so we're going to focus on our HSBC House viewed today as I mentioned is better that you have the hard copy. Investment monthly reporting for you so you can take some notes while I present. So let's talk about was the IM cover so I am bhushi covered our house view and also the. I'll look for the market. And also which asset class that we are overweight and underweight Anne was the reason behind the scene and. Also, you can also see some of the key risk on the market and how the how how does it? Impact the market and how old is related to our fund performance so as some new MFA this call is really helpful. You to understand how the market really related to our fund performance. So it's better to get familiar with our house, you 1st and to construct a better boss conversation with replying. So let's see the answer that from the last question so the news that actually moved in the market in November. Is the USA and China trade deal optimism so because we having the? Face one deal finalizing between USA and China so market has been rallying things everything we heard this news. So the last answer is actually the right answer. Right now we don't have the trade attention worry and also the recent recession. All right. On the second page of the investment monthly it provide a quick summary of the market outlook and then the key risk in the market. Let's talk about the first one, the global empty so global actually rose in November as the newest and China came closer to agree on the term. Uh for the Phase 1 trade deal so that's why we remain overweight inactives and giving the wider valuation gap. Compared to the bomb so the upside potential is likely to catch my uncertainty while the downside risk is also limited. By default active policy maker. And then also for government bonds if you look at USA and European government bond both as a cloud spell in November due to the. Improved investor risk appetite due to the trade optimistic from the face one deal finalizing so investor really have shifter. Interest into the list asset class. Uh but afford are significant deterioration from the global economic outlook could change our view, but however, we are now experiencing. Very cyclical slowdown, which we think is showing assigning signs of bottoming in the market, so global recession risk is very low. Ernie and probably fundamental has beginning to come down under the pressure, although we have seen some. Improvement in the emerging market earnings. So moving on to the next slide was in the news so this is really also a summary on the. Wines in November, an is really good talking point here, US in China, trade attention is still in the picture. But now it's shipping from detention into optimistic but the lately. The stock market in the USA and China has invalid by this. All is good news from the face one deal so we believe continued to. Over weight in the global global active continue to offer a very attractive return in our favorable baseline view of. Global economic. And also, if you pay attention is solid USA. Labor market continue continue to support the household spending and Meanwhile, activity in manufacturing business sentiment and also export sectors. Reminds weaker from a slower global growth, but things started bottoming as I mentioned so the risk of recession remains really low in our field. Alright so let's take a look at asset class performance. So we had on this page. I've teens corporate bond government bond and. Commodities so let's talk about the full asset class performance in the month of November in the USGS has been. A sign of improvement in the business sentiment as I mentioned earlier, the November you as purchasing manager index. As pointed to a pickup in activity across from both manufacturing and servicing so Autumn Autumn Mystic around a trade deal combined with the improved. Activity and a drop number helps to lose as simply 500 rose by 3.6% in the total return. And pushing is year to date return over 25% and I'm putting into best actually a calendar year since 2013. And then we see the same picture with Canadian actor for the month is up by 3.4%. And year to date, it up by 19%. With the action market has done really well in November. So the bond market was slightly down since the investor has shifter attention to the active market, so bomb bomb market hasn't. Has too much participation in the month of November. And also for commodity we upgrade our view on selected commodity and giving the expectation that they can perform really. Very well in the scenarios of sharply rising geopolitical risks and also the oil futures looking pretty attractive do too. They knew that. January from the future market, so that's kind of different from the spot market, which we think is the oil price so. Z. The. The future market looking pretty attractive query. All right, so let's say moving on to the next question. Uh why are we overweight inactive after market rally in 2019 so I will pause for a couple seconds? And for you guys to answer the question. All right. So let's move on to the next slide and then we can come back to the answer in a couple. Minutes. Let's take a look at the investment view or the rest of the asset class and since I talked about the active so. Let's talk about the bond market, so we're currently underweight in the government bond and corporate bond market things the risk. Adjusted return is not a really attractive in this asset class and giving most of the required. Isaiah class are overvalued in our view, and also investor are being penalized for. Green, the interest waste and also the inflation rate so we perform active right now and we think this risky asset class. Offer pretty attractive risk adjusted return and for Asian asset class. The economic growth in Asia has helped. Held up relatively well and Marco economic structural features are better than the other merging market weight range and so we are. A slightly overweight in some of the Asian asset class. All right. So let's take a look at the. Answer that we just saw from the last questions. So we could actually pretty fairly evenly distributed answer, but most people answer the? Overweight ways again the empty. Classes because the economic growth is still positive even though it slowly so it's actually correct so actually all of this. Answer are correct, the first one, we have the actors are still very attractive relative on which is yes. As I mentioned a degrees adjusted return in the actives are very attractive and the second answer is B. Athletes are still very attractive. You need to cash. Yes, that's the right answer to because if you want a long term growth. After example your client once the long-term goals in 7%, every year or 5%, you do need to invest. In acting side instead of just putting everything into Barnwood cash so yes, and also I already answered which is. Right and then the last one valuations are still there, which is also right because if you look at the TV show. USA and Canada is still pretty fair for those 2 market PE ratio is slightly higher compared to average. I do comparison, all time high is still much below comparison. All time high so with all these reasons. I would think fundamental are strong. And markets and still have a pretty good outside. Alright so let's move on to the. Performance highlights for our fun line odds. On this page you see this is the investor series or it just BC Mutual Fund and let's talk about the two money market fund 1st. The the two money market fund you has dropped since the beginning of this year, 2 four point 1.42. Two one .04% for both Canadian an US money market fund the reason because the For the year high school because in the in the low interest rate environment as you also know notice. The Fed has made 3 times this year, so that's why you see in the new has come down. Lower compares to begin this year. And it also let's move on to the fixed income. I said plus fixed income fund has done really well. And the volume in the Canadian an global market has falling since starting up this year. But remember when the bond you fall. Pompeys rice, so earlier today faces the investor series of global corporate bond fund. Has one tier two 1010.64% and Canadian bond fund has about 7.5%? But in November Brown nude move our margin higher so the global government and investment grade bond index as long. Slightly about your point 8% this month, so that's why you sing the performance has been. A flat for the month of November, but keep in mind going forward. It is important to be cautious about. Invest in fixed income fund because the market has been largely pricing for the green card already so the upside is very limited. For all the fixed income asset class. Let's take a look at the. Actually, fund so we have Canadian Aptean International active so let's talk about the market a little bit how that's related to the good. Performance for the month of November, so with the central bank easing is a key factor in the market return so far this year. An investor really didn't get much knew information for the month of November, so it's only the central banks. In England, how the meeting last month is need to know change for the policy rate an both developed countries. Overdeveloped market actually outperformed emerging market at these with S&P 500, ending the month as the best. Performance major acting index, therefore all North American acting index has had a great month in November 2 also due to the face one deal. Or Russian of USA and China. Uh so dividend funds and I've defined were up around 4.5% a year to date is very solid. Performance is up about 19% small cap grows file has also outperformed the large cap Canadian active fund this. Here, with your today performance of over almost 24% so therefore, there is a diversification benefit too. In less in both large and small type active. And your today performance remind also positive for the. All for an active funds lead by the global activity. We focus fund and USLT find. Which were also both up by approximately 20% so keep in mind the performance vary by market and also exchange rate? Therefore, when investing in for an active fund investor exposure, exposing to a higher risk compared to the domestic. Let's move on to the next page look at it. For my series. Performance so as you can see on this page premise series offer slightly higher return due to the MBR. Is nowhere a butt Premier series? Need minimal $100,000 to start so investment investors can invest in this? Nearest. Let's take a look at our was compressed file. It was fun. Things fun also down while for the month of November. Uhm but while someone spun is only suitable for client, who prefers online investment journey as well as passive strategy in the low cost, so there's Even take every imagine the world compass fine. And let's take a look at the word selection diversified fund. It is a great solution because the offers are very good diversification. Anri balance and also this is active management. By our portfolio management team and this requires a lower minimum to start as well compared to the recipe. Let's take a look at the guys pee so obviously most of you guys know Douglas P fairly well. WC needs $50,000 to start and offers better diversification compared to the SDF and also the most. Aggressive portfolio outperformed the most conservative portfolio because at the rally for the month of November. And here's your date as you can see here. The performance aggressive growth is also doing very well for almost. 16.6% of keep in mind, aggressive growth also has fixed income component in the portfolio. So D performance and it won't be. I've seen as the pure this individual stock market index. Oh, right so um. Let's see if you guys have any questions. OK so I have a question from Karen. What is the expectation for interest rate in the USA? And also Canada in 2020. Oh, with the A current consensus that we sing right now in the market you S may have a probability of cutting weight. One times in 20, funny but because the fundamental in the US has been done really well so the Federal Reserve has really hired. Bar for them to cut wait another time, it may going to be just we are sitting at the end of the easing cycle. So the probability is one time, but there's maybe a chance that they won't wait they hold the weight. And change for 2020 with Canada in 2020. We gonna see one rate cut in 2020 just because we want to keep in life. Will be US market and then is more like just say insurance cut in the 2020 so nothing really major hardly. Canadian economy was so probably the reason just to be in line with the US market. OK. So let's take a look at another question from Jimmy my client losing money in bonds since he invests. Uh in September and why OK this is a very common question, we had climbed lately because remember we talked about. The bond market, and also the price in the bond is highly pressing from the right partner ready and since September the market from SMP. Or most developed country actives are has been recovered from the bottoming so when using the after market has been doing well. And I will speak Klingon ship their attention to deal with IC class so there's less activity in the bond market, and also we come down to the end of easing cycle. So this is one of the reasons why the bond market has been has been. Now performing that welcome here, so earlier this year since September. And I have another question from devil? What do I sync DUS election will have any active cell off? By October 2020. It is the 5050 + 5050 chance answer if Trump got elected the market, maybe rally if he doesn't get. Elected because it's a huge contributor. I would say in 2019 stock market performance. So if he doesn't get elected the market may get sell off. Uh by October 2020, but again, it's a 5050 quest answer a lot of things can happen. Uh in the year from now until October, the economy fundamentally change or the big environment may change, so. Never really cold on the election for long term investment performance. And I have another question from Henny what I think about in stock market may happen if Trump is. Impeach. Um. Again, it's like the last question, I answered It is a 5050 by the chance and see that. An impeached. Fairly low currently but they made it have a chance. He may got engaged so I'm not going to comment. Too much about it because she's like a gambling I'm beating. On one outcome. Uh I have another question from Sam? What is the view on bonds so as I mentioned in the in the pool? Uh currently were underweight most of the fixed asset affixing combined classes just due to the valuation is not attractive anymore. Market has been highly pricing in that asset class, so we are now overweight inactive. I have another question from quiz about the mortgage bond and money market funds. So he's asking is the mortgage fund or money market fund. A Saber option for my clients from a risk profile view. It is yes because mortgage fund and let's talk about branding marketing so money market fund. Enterprise almost stays the same unless something really bad happened in the market, so the universe may drop lower than $1010.00. But you should you see that there's any change, so it's all the noise with. In our fun family and let's talk about mortgage rent or mortgage fund is the next closest into the money market funds just because. Mortgage is within the fund are solely owned by HSBC and duration risk on the mortgage bond is fairly low resolution. 1.5 to 2, two on the duration side, so it is fairly low for the week before. If you want to ask me if the the risk. Uh. I understand to funds are very low. And we have a last question from. Happy. It is better to investing in the USA or Canadian market or international market like the brick fund or long term. Investor for this concern is really familiar applying his risk tolerance. So if the plank and not really take too much risk I guess break fund is not a good fit. But it is a higher risk profile, then break fan can be a good long term solution for you. Because keep in mind, both emerging market valuations is is really is still fairly low compared to the overtime pie. So investing in the brick fund, which is emerging market fund that could offer a good solution for long time. Why along from a long-term investor but only if he has the high risk profile? OK, so I guess there's no more questions if you do have any questions, please reach out to me. And remember to complete the survey at the end, the webinar and just to want to remind remind you guys. My team's contact for eastern Canada. You have any questions, please reach out to James when for eastern Canada. Please reach out to myself. I'm happy to assist. Um and if you don't have any other questions. Please remember to complete the survey and just a reminder we don't have the? Webinar what's up with our fund in January, so we have no shows. Uh and also wish you guys Merry Christmas and happy holiday.
During the presentation, we will discuss:
The latest news headlines and how they impact the markets and our views