Fund overview & performance

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Canada Life Segregated Funds

Canada Life Canadian Fundamental Equity Fund

Fund profile and commentary

Fund fact

July 31, 2025

The Fund seeks to provide long-term capital appreciation by investment primarily in Canadian equity securities.

Is this fund right for you?

You want your money to grow over the longer term.
You want to invest mainly in Canadian companies.
You're comfortable with a medium level of risk.

Risk Rating

How is the fund invested? (as of May 31, 2025)

Asset allocation (%)

	Name	Percent
	Canadian Equity	97.3
	Income Trust Units	1.9
	Cash and Equivalents	0.7
	Other	0.1

Geographic allocation (%)

	Name	Percent
	Canada	99.5
	Bermuda	0.6
	Other	-0.1

Sector allocation (%)

	Name	Percent
	Financial Services	32.5
	Basic Materials	13.1
	Energy	12.0
	Technology	10.8
	Industrial Services	10.7
	Consumer Services	7.0
	Utilities	4.1
	Real Estate	3.5
	Consumer Goods	1.9
	Other	4.4

Growth of $10,000 (since inception)

Data not available based on date of inception

Fund details (as of May 31, 2025)

Top holdings	%
Royal Bank of Canada	6.8
Toronto-Dominion Bank	5.2
Shopify Inc Cl A	4.4
Agnico Eagle Mines Ltd	3.8
Constellation Software Inc	3.7
Canadian Pacific Kansas City Ltd	3.4
TC Energy Corp	3.1
Enbridge Inc	2.9
Canadian Imperial Bank of Commerce	2.6
Manulife Financial Corp	2.6
Total allocation in top holdings	38.5

Portfolio characteristics
Standard deviation	10.9%
Dividend yield	2.1%
Average market cap (million)	$81,658.4

Understanding returns

Annual compound returns (%)

1 MO	3 MO	YTD	1 YR
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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 (November 1, 2018 - July 31, 2025)

Best return	Best period end date	Worst return	Worst period end date
16.3%	March 2025	6.1%	Oct. 2023

Average return	% of periods with positive returns	Number of positive periods	Number of negative periods
9.9%	100.0%	22	0

Q2 2025 Fund Commentary

Market commentary

Equity markets shifted from pronounced volatility in April to a recovery by the end of the second quarter of 2025. Early volatility stemmed from the announcement of U.S. tariffs, which led to a steep decline in U.S. equities. Canadian equities also declined, but less than U.S. equities, benefiting from defensive sectors such as consumer staples and gold.

Equities recovered because of a temporary easing of trade tensions, better-than-feared corporate earnings and resilient economic data. While concerns lingered over U.S. fiscal policy following a sovereign credit rating downgrade, U.S. equities rose to 2024 levels. Canadian equity markets benefited from renewed investor optimism, reaching all-time highs.

In Canadian equities, cyclical sectors outperformed defensive sectors, with top performance from information technology, consumer discretionary and financials. The energy, communication services and consumer staples sectors lagged. Despite rising geopolitical tensions in the Middle East, oil prices declined, leading energy to underperform.

Performance

The Fund’s relative overweight exposure to Cameco Corp. and Celestica Inc. had the most positive impact on performance. Cameco benefited from exposure to uranium because of global trends toward electrification, increasing energy security concerns and expansion of artificial intelligence (AI) data centres. Celestica benefited from growing adoption of generative AI, which requires increasingly powerful computing infrastructure to support these technologies.

Relative overweight exposure to Descartes Systems Group Inc. was negative for performance. Descartes Systems was affected by reports indicating slower organic growth and negative volume trends in May.

At the sector level, stock selection in energy and industrials had a positive impact on performance. Underweight exposure to energy had a positive impact as the sector underperformed. Selection in materials had a negative impact on performance.

Portfolio activity

The sub-advisor added Magna International Inc., a leading auto parts supplier, based on its valuation as well as impacts of U.S. tariffs being less severe than initially expected. Cameco was increased due to its exposure to uranium, which the sub-advisor believes should see strong demand in the future.

BCE Inc. was sold based on its stagnant core business and lackluster forecasts. The company’s management plans to reassess the stock’s current dividend level, suggesting a potential dividend cut sooner than expected. CES Energy Solutions Corp. was reduced as crude oil prices fell, leading the sub-advisor to expect a slowdown in industry activity and reduced oil production.

Outlook

In the sub-advisor's view, in both Canada and the U.S., the economic outlook has stabilized as recession risks have declined. Concerns around tariffs and geopolitical tensions appear to be lower. Central banks are shifting toward a more accommodative stance, with the Bank of Canada expected to continue cutting interest rates this summer. The sub-advisor believes the U.S. Federal Reserve Board is likely to begin cutting interest rates later in the year.

The U.S. introduced stimulative legislation and Canada is expected to deliver a supportive fall budget. In the sub-advisor's view, corporate fundamentals remain healthy. While valuations are elevated, stable earnings and improved visibility are providing support for equities.

Though the sub-advisor has a positive outlook for the economy and equity markets, key risks remain. Tariff-related inflation could present a challenge for central banks and the full economic impact remains uncertain. Investor sentiment has improved, reducing the margin for error, while equity risk premiums remain compressed.

In this environment, the sub-advisor favours high-quality businesses with durable earnings growth. Exposure to defensive companies has been reduced in favour of adding to quality cyclical companies trading at attractive valuations based on normalized earnings. The sub-advisor will also look through short-term equity weaknesses and focus on 2026 earnings potential.

(March 31, 2025)

Connor, Clark & Lunn Investment Management

NL — MAX2163

Contact information

Toll free: 1-844-730-1633

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Summary

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Total returns performance

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Legal disclaimers

The commentaries on the company specific information and purchases and sales were provided by the fund manager. Canada Life Investment Management Ltd. will not be liable for any loss, or damages whatsoever, whether directly or indirectly incurred, arising out of the use or misuse of errors or omissions in any information contained in this commentary. The data provided in this commentary is for information purposes only and, except where otherwise indicated, is current as of June 30, 2025.

The views expressed in this commentary are those of the fund manager as at the date of publication and are subject to change without notice. This commentary is presented only as a general source of information and is not intended as a solicitation to buy or sell specific investments, nor is it intended to provide tax or legal advice. Prospective investors should review the offering documents relating to any investment carefully before making an investment decision and should ask their Advisor for advice based on their specific circumstances.

The content of this commentary (including facts, views, opinions, recommendations, descriptions of or references to, products or securities) is not to be used or construed as investment advice, as an offer to sell or the solicitation of an offer to buy, or an endorsement, recommendation or sponsorship of any entity or security cited. Although we endeavour to ensure its accuracy and completeness, we assume no responsibility for any reliance upon it.

This document may contain forward-looking information which reflect our or third-party current expectations or forecasts of future events. Forward-looking information is inherently subject to, among other things, risks, uncertainties and assumptions that could cause actual results to differ materially from those expressed herein. These risks, uncertainties and assumptions include, without limitation, general economic, political and market factors, interest and foreign exchange rates, the volatility of equity and capital markets, business competition, technological change, changes in government regulations, changes in tax laws, unexpected judicial or regulatory proceedings and catastrophic events. Please consider these and other factors carefully and not place undue reliance on forward-looking information. The forward-looking information contained herein is current only as of June 30, 2025. There should be no expectation that such information will in all circumstances be updated, supplemented or revised whether as a result of new information, changing circumstances, future events or otherwise.

There can be no assurance that the Fund’s return or volatility targets will be met, or met over any particular time horizon. Targeted returns and volatility should be evaluated over the time period indicated and not over shorter periods. Targeted returns are not actual performance and should not be relied upon as an indication of actual or future performance.

Canada Life Mutual Funds are managed by Canada Life Investment Management Ltd. The funds are distributed by Quadrus Investment Services Ltd., IPC Investment Corporation, and IPC Securities Corporation, and may also be available through other authorized dealers in Canada. Commissions, trailing commissions, management fees and expenses all may be associated with mutual fund investments. Please read the prospectus before investing. Mutual funds are not guaranteed, their values change frequently, and past performance may not be repeated.

Canada Life Mutual Funds, Canada Life Investment Management and design, and Canada Life and design are trademarks of The Canada Life Assurance Company.

^Deferred Sales Charge (DSC) and Low Load Deferred Sales Charge (LSC) purchase options is closed to new investments given regulatory bans put in place for these purchase options that came into effect June 1, 2022.

^†Soft capped - Contributions are no longer accepted to new investors.

^‡Hard capped - Contributions are no longer accepted.

Distribution of the chart, history standard and short-term reports are not permitted without including the fund profile long-term report. For money market fund reports: The current yield is an annualized historical yield based on the seven-day period ended on the date noted above and does not represent an actual one-year return. Reports produced using this website are for information purposes only. Canada Life Investment Management Ltd., and their affiliates, representatives, and third party content providers do not warrant the accuracy, completeness, or timeliness of this website or any content, and shall not be responsible for investment decisions, damages, or other losses resulting from the use of this website or its content. The only true report on unit values is the periodic statement prepared and sent by the mutual fund company. Important information about Canada Life Mutual Funds is found in Fund Facts. Commissions, trailing commissions, management fees and expenses all may be associated with mutual fund investments. The indicated rates of return are the historical annual compounded total returns including changes in unit value and reinvestment of all distributions and does not take into account sales, redemption, distribution or optional charges or income taxes payable by any unitholder that would have reduced returns. Mutual funds are not guaranteed, their values change frequently and past performance may not be repeated. Money market fund units are not covered by the Canada Deposit Insurance Corporation or by any other government deposit insurer. There can be no assurances that the fund will be able to maintain its net asset value per unit at a constant amount or that the full amount of your investment in the fund will be returned to you. Past performance of the funds may not be repeated. Canada Life Mutual Funds are managed by Canada Life Investment Management Ltd. The funds are distributed by Quadrus Investment Services Ltd., IPC Investment Corporation, and IPC Securities Corporation, and may also be available through other authorized dealers in Canada.

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