Northern Trust Pension Universe Data: Canadian Pension Plan Returns Boosted by Robust Financial Markets During the Third Quarter
Canadian pension plans achieved strong performance in Q3 2023, with the Northern Trust Canada Universe reporting a median return of 4.8% for the quarter and 8.4% year-to-date as of September 30. The positive results were driven by robust performance in both stocks and bonds, with Canadian equities leading at 10.5% returns. The quarter saw significant monetary policy shifts, including the U.S. Federal Reserve's 50-basis point rate cut and the Bank of Canada's 25-basis point cut to 4.25%. The Canadian Fixed Income market advanced 4.7%, while international markets also showed strong performance with the MSCI EAFE Index recording 6.0% in CAD.
I piani pensionistici canadesi hanno registrato un'ottima performance nel terzo trimestre del 2023, con il Northern Trust Canada Universe che ha riportato un ritorno mediano del 4.8% per il trimestre e un 8.4% da inizio anno al 30 settembre. I risultati positivi sono stati sostenuti da solide performance sia in azioni che in obbligazioni, con le azioni canadesi che hanno guidato con un ritorno del 10.5%. Durante il trimestre ci sono stati significativi cambiamenti nella politica monetaria, inclusi il taglio dei tassi della Federal Reserve degli Stati Uniti di 50 punti base e il taglio della Bank of Canada di 25 punti base portando così il tasso al 4.25%. Il mercato delle obbligazioni canadesi ha registrato un avanzamento del 4.7%, mentre i mercati internazionali hanno mostrato una forte performance con l'indice MSCI EAFE che ha registrato un 6.0% in CAD.
Los planes de pensiones canadienses lograron un fuerte desempeño en el tercer trimestre de 2023, con el Northern Trust Canada Universe reportando un retorno medio del 4.8% para el trimestre y un 8.4% en lo que va del año hasta el 30 de septiembre. Los resultados positivos fueron impulsados por un sólido desempeño tanto en acciones como en bonos, siendo las acciones canadienses las que lideraron con un retorno del 10.5%. En el trimestre se observaron cambios significativos en la política monetaria, incluyendo la reducción de tasas de 50 puntos básicos de la Reserva Federal de EE. UU. y el recorte de 25 puntos básicos de la Bank of Canada, llevando su tasa a 4.25%. El mercado de Renta Fija canadiense avanzó 4.7%, mientras que los mercados internacionales también mostraron un fuerte desempeño con el índice MSCI EAFE registrando un 6.0% en CAD.
캐나다 연금 계획은 2023년 3분기에 강력한 성과를 달성했으며, Northern Trust Canada Universe는 분기 동안 중간 수익률 4.8%을 보고했고 9월 30일 기준으로 8.4%의 연초 대비 수익률을 기록했습니다. 긍정적인 결과는 주식과 채권 모두에서의 강력한 성과에 의해 주도되었으며, 캐나다 주식이 10.5%의 수익률로 이끌었습니다. 이번 분기에는 미국 연방준비제도의 50BP 금리 인하와 캐나다 은행의 25BP 인하(4.25%로 조정 충)를 포함한 중요한 통화 정책 변화가 있었습니다. 캐나다 고정 수익 시장은 4.7% 상승했으며, 국제 시장도 MSCI EAFE 지수가 CAD로 6.0%을 기록하며 강력한 성과를 보였습니다.
Les régimes de retraite canadiens ont obtenu de bons résultats au troisième trimestre de 2023, le Northern Trust Canada Universe rapportant un rendement médian de 4.8% pour le trimestre et 8.4% depuis le début de l'année au 30 septembre. Les résultats positifs ont été entraînés par une performance robuste tant des actions que des obligations, avec les actions canadiennes en tête avec un rendement de 10.5%. Ce trimestre a été marqué par des changements significatifs dans la politique monétaire, y compris une baisse de 50 points de base des taux par la Réserve fédérale des États-Unis et une baisse de 25 points de base par la Banque du Canada à 4.25%. Le marché des titres à revenu fixe canadien a progressé de 4.7%, tandis que les marchés internationaux ont également montré une forte performance, l'indice MSCI EAFE enregistrant un 6.0% en CAD.
Die kanadischen Pensionspläne erzielten im dritten Quartal 2023 eine starke Leistung, wobei das Northern Trust Canada Universe eine medianer Rendite von 4.8% für das Quartal und 8.4% seit Jahresbeginn zum 30. September meldete. Die positiven Ergebnisse wurden durch eine robuste Leistung sowohl im Aktien- als auch im Anleihenmarkt unterstützt, wobei die kanadischen Aktien mit 10.5% Rendite führten. Das Quartal sah bedeutende Veränderungen in der Geldpolitik, einschließlich einer Zinssenkung um 50 Basispunkte durch die US-Notenbank und einer Zinssenkung um 25 Basispunkte durch die Bank von Kanada auf 4.25%. Der kanadische Anleihenmarkt legte um 4.7% zu, während auch die internationalen Märkte eine starke Leistung zeigten, wobei der MSCI EAFE Index einen 6.0% in CAD verzeichnete.
- Median Canadian Pension Plan return of 4.8% in Q3 and 8.4% YTD
- Canadian equities posted strong 10.5% return in Q3
- Canadian Fixed Income market advanced 4.7%
- International markets performed well with MSCI EAFE Index up 6.0% in CAD
- Healthy pension plan solvency ratios maintained
- Periodic selloffs across technology sector
- Pockets of weak economic data affecting investor confidence
- Softening job data in Canadian economy
Insights
The Canadian pension market showed remarkable resilience in Q3 2023, with a
The S&P/TSX Composite Index's impressive
For institutional investors, the combination of declining inflation, strategic rate cuts and strong market performance across both equities and fixed income suggests an improving environment for pension fund solvency ratios. This marks a significant positive shift in the risk-return landscape for Canadian pension plans.
The synchronized monetary policy shift across major economies marks a pivotal moment in the post-pandemic era. The Fed's 50-basis point cut to
China's stimulus package introduction, coupled with Brazil's measured rate increase to
This global monetary recalibration, combined with cooling inflation trends, creates a more supportive environment for institutional investors, though careful monitoring of regional divergences remains crucial.
The Northern Trust Canada Universe tracks the performance of Canadian institutional defined benefit plans that subscribe to performance measurement services as part of Northern Trust’s asset service offerings.
A number of events triggered volatility in the third quarter, including elections in the
The
“As major central banks around the globe seek a path to neutrality, Canadian pension plans remained in solid financial form supported by healthy solvency ratios. Throughout the interest rate journey, plan sponsors exercised vigilance through the lens of balancing risks and adopting sound strategies that position plan investments for a successful and sustainable retirement future,” said Katie Pries, President and CEO of Northern Trust Canada.
During the third quarter impressive returns across both stocks and bonds were observed as the headwinds felt by monetary policy showed signs of moderating. Equity markets marched higher on the heels of the Fed’s first interest rate cut since 2020, with Canadian equities leading the path and posting a double-digit return. This positive sentiment echoed across the Canadian bond market as yields moved lower with the Canadian Bond Universe closing the period with strong results.
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Canadian Equities, as measured by the S&P/TSX Composite Index, advanced
10.5% for the quarter. All sectors within the index posted positive performance, led by Real Estate followed by Financials, Utilities and Health Care sectors. -
U.S. Equities, as measured by the S&P 500 Index, returned4.5% in CAD for the quarter, with 10 of the 11 sectors generating positive returns, led by the Utilities sector and followed by Real Estate. The Energy sector was the only segment posting negative returns for the period. -
International developed markets, as measured by the MSCI EAFE Index, recorded
6.0% in CAD for the quarter. Most sectors advanced during the period with Real Estate being the top performer and the Energy sector posting the weakest results. -
The MSCI Emerging Markets Index generated
7.5% in CAD for the quarter. Most sectors posted positive returns led by the Consumer Discretionary and Health Care sectors, while Information Technology and Energy sectors declined over the period.
The Canadian economy saw downward pressure on inflation throughout the quarter impacted by excess supply. As the job data continued to show signs of softening, this led the Bank of
The
International markets witnessed a cooling of Eurozone inflation and concerns of an economic slowdown which led the European Central Bank (ECB) to lower the deposit rates to
Emerging markets observed solid gains during the third quarter. The People’s Bank of China (PBoC) announced a massive stimulus package in an effort to support its economy. The Central Bank of
The Bank of
The Canadian Fixed Income market, as measured by the FTSE Canada Universe Bond Index, advanced
About Northern Trust
Northern Trust Corporation (Nasdaq: NTRS) is a leading provider of wealth management, asset servicing, asset management and banking to corporations, institutions, affluent families and individuals. Founded in
Northern Trust Corporation, Head Office: 50 South La Salle Street,
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Camilla Greene
+44 (0) 20 7982 2176
Camilla_Greene@ntrs.com
Simon Ansell
+ 44 (0) 20 7982 1016
Simon_Ansell@ntrs.com
US &
John O’Connell
+1 312 444 2388
John_O’Connell@ntrs.com
Source: Northern Trust Corporation
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