Standard Life Canadian Equity Class
Standard Life Canadian Equity Class
Standard Life Canadian Equity Class
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Searching<br />
for yield<br />
by Carlos Da Costa Frias<br />
Coming out of the<br />
credit crisis<br />
in 2009<br />
a clear need for higher income and<br />
lower volatility emerged from<br />
investors within the mutual fund<br />
industry. Funds that could<br />
generate income, such as Monthly<br />
Income Funds, became even more<br />
popular than before. Despite<br />
certain portfolio constraints, most<br />
Monthly Income Funds gave<br />
investors a balanced approach to<br />
the markets – providing both<br />
equity exposure and income<br />
generation within their portfolio.<br />
The year 2010 provided attractive<br />
capital gains and, as stock prices<br />
rose, equity yields consequently<br />
declined, resulting in lower overall<br />
dividend income. Let’s take a quick<br />
look at how markets have been<br />
performing for the first half of the<br />
year. The year 2011 got off to a<br />
good start for the major <strong>Canadian</strong><br />
and U.S. indices; but since then, we<br />
have seen recent volatility pare<br />
down almost all of those gains. On<br />
a year-to-date basis, we are looking<br />
at a 0.2% return for the S&P/TSX<br />
Composite index and a 2.8% return<br />
for the S&P 500 (CAD) index.<br />
<strong>Canadian</strong> & U.S. YTD Index Returns<br />
5.00%<br />
4.00%<br />
3.00%<br />
2.00%<br />
1.00%<br />
0.00%<br />
-1.00%<br />
-2.00%<br />
-3.00%<br />
-4.00% Jan Feb Mar Apr May Jun YTD<br />
Source: PALTrak, June 2011<br />
S&P/TSX Composite S&P 500<br />
The Quarterly Review 15
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