A fixed-income fund seeking to provide regular income with low volatility.
Is this fund right for you?
- You want to protect your money from inflation while also protecting it from large swings in the market.
- You want to invest in a variety of fixed-income securities, either directly or through other mutual funds.
- You're comfortable with a low level of risk.
Risk Rating
How is the fund invested?
(as of March 31, 2025)
Asset allocation (%)
|
Name |
Percent |
|
Domestic Bonds |
71.6 |
|
Foreign Bonds |
21.6 |
|
Cash and Equivalents |
5.0 |
|
US Equity |
0.1 |
|
Canadian Equity |
0.1 |
|
Other |
1.6 |
Geographic allocation (%)
|
Name |
Percent |
|
Canada |
75.6 |
|
United States |
15.1 |
|
Multi-National |
2.5 |
|
New Zealand |
1.4 |
|
Europe |
1.0 |
|
United Kingdom |
0.5 |
|
North America |
0.5 |
|
Mexico |
0.4 |
|
Italy |
0.4 |
|
Other |
2.6 |
Sector allocation (%)
|
Name |
Percent |
|
Fixed Income |
94.7 |
|
Cash and Cash Equivalent |
5.0 |
|
Consumer Goods |
0.1 |
|
Financial Services |
0.1 |
|
Utilities |
0.1 |
Growth of $10,000
(since inception)
Data not available based on date of inception
Fund details
(as of March 31, 2025)
| Top holdings |
% |
| Canada Life Canadian Core Fixed Inc Fd I |
34.6 |
| Canada Life Global Inflation-Linked Fixed Income S |
2.5 |
| Cash and Cash Equivalents |
2.3 |
| Canada Government 2.75% 01-Dec-2055 |
1.8 |
| Canada Government 3.25% 01-Dec-2034 |
1.8 |
| United States Treasury 4.63% 15-Feb-2055 |
1.6 |
| Canada Government 3.25% 01-Jun-2035 |
1.4 |
| Quebec Province 4.40% 01-Dec-2055 |
1.4 |
| Ontario Province 3.60% 02-Jun-2035 |
0.9 |
| TransCanada Trust 4.65% 18-May-2027 |
0.8 |
| Total allocation in top holdings |
49.1 |
| Portfolio characteristics |
|
| Standard deviation |
6.2% |
| Yield to maturity |
4.8% |
| Duration (years) |
7.0 |
| Coupon |
4.5% |
| Average credit rating |
A |
Understanding returns
Annual compound returns (%)
| 1 MO |
3 MO |
YTD |
1 YR |
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| 3 YR |
5 YR |
10 YR |
INCEPTION |
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Calendar year returns (%)
|
2024 |
2023 |
2022 |
2021 |
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|
2020 |
2019 |
2018 |
2017 |
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Range of returns over five years
(August 1, 2016 - May 31, 2025)
| Best return |
Best period end date |
Worst return |
Worst period end date |
|
2.3% |
Dec. 2021 |
-1.2% |
Oct. 2022 |
| Average return |
% of periods with positive returns |
Number of positive periods |
Number of negative periods |
|
0.1% |
40.4% |
19 |
28 |
Q1 2025 Fund Commentary
Market commentary
Global equities declined in the first quarter of 2025 while global bonds posted a modest gain (all returns in Canadian-dollar terms on a total return basis). Trade and policy changes from the new U.S. presidential administration raised concerns about a potential recession in the U.S.
The implementation of several tariffs by the U.S. affected key trading partners, including Canada, China and Mexico. Anticipation of retaliatory tariffs, which were to be enacted after the quarter-end, also weighed heavily on investor sentiment. As a result, the U.S. equity market posted a mid-single-digit loss, with the consumer discretionary sector performing weakly.
In contrast, Canadian equities gained, with the materials sector leading. Europe, Australasia, and the Far East (EAFE) equities also gained, outperforming both Canadian and U.S. equities, and driven by strong performances from Spain and Italy.
Emerging markets equities also rose but lagged their developed market peers, with notable gains from South Korea and Brazil.
The FTSE Canada Universe Bond Index gained 2.0%. Government bond prices rose as sovereign yields declined, outperforming corporate bonds, which also posted gains. However, corporate bond prices were impacted by widening credit spreads (the difference in yield between corporate and government bonds).
Within the corporate sector, infrastructure bonds saw the largest increase. High-yield bonds posted gains but underperformed investment-grade corporate bonds.
Global bond yields declined over the quarter, leading to an increase in global bond prices. The Bank of Canada, European Central Bank and Bank of England lowered their policy interest rates. The U.S. Federal Reserve Board maintained its rates, while the Bank of Japan raised its policy interest rate.
The yield on 10-year Government of Canada bonds fell by 25 basis points, from 3.22% to 2.97%, mirroring the decline in U.S. yields. In contrast, sovereign yields in the U.K., Germany and Japan increased.
Performance
The Canadian fixed income allocation had a negative impact on performance.
An off-benchmark allocation to global inflation-linked debt had a positive impact on performance.
A relative overweight to corporate bonds was negative as credit spreads widened.
Exposure to Canada Life Global Multi-Sector Bond Fund had a positive impact because of its favourable positioning versus the benchmark.
Exposure to Canada Life Canadian Core Plus Bond Fund had a negative impact on performance because of its overweight allocation to corporate bonds.
Portfolio activity
Consistent with the sub-advisor’s mid- to longer-term views, there were no purchases or sales completed during the quarter. The sub-advisor didn’t increase or decrease any position sizes.
Outlook
The most significant development so far in 2025 was the escalation in trade tensions, which suggests a major shift in the structure of global markets. The tariff-driven economic slowdown and weaker business sentiment have led to downward gross domestic product revisions. However, the latest activity data suggests a more resilient economy than initially anticipated.
The current global equity correction has similarities with past episodes where inflation and restrictive trade policies led to weakness before markets eventually stabilized. The sub-advisor believes 2025 should be a year of slower but positive growth, with opportunities emerging as policy uncertainty clears. History suggests volatility driven by trade concerns often resolves once underlying economic data stabilizes.
With the ongoing market uncertainty, the sub-advisor has emphasized sector diversification to limit exposure to market declines while keeping long-term exposure to recovery opportunities.
The sub-advisor believes the current environment underscores the importance of a globally diversified investment strategy that remains focused on long-term objectives.