Quarterly Portfolio Fund update

Read Investment Update weekly for the latest information on the financial markets, insights around current headlines, special reports, and more.

How Portfolio Funds performed during Q4 2024

Three of the five portfolios within the Portfolio Funds were able to outpace their benchmark indices in the fourth quarter. Growth outperformed income segments, driven by strong returns from the Canadian and U.S. equity markets. U.S. equities generated the largest positive returns, due in part to a weakening Canadian dollar against the U.S. dollar. Canadian corporate bonds had positive returns of just over 1%. From an overall financial market perspective, U.S. equities generated the largest positive return, followed by Canadian equities. Global equities lagged behind with negative returns. Fixed income markets are still processing the growth prospects of the economy and future inflation levels, as well as the next moves from central banks around the world, as short-term interest rates have continued their descent after a series of interest-rate hikes in 2022 and 2023 in most of the major economies.

Note:Rates of return for each portfolio are provided on an after-fees (net) basis. Given that fees are only applied at the portfolio level, all references to underlying fund performance are before fees (gross)

Key take-aways

Canadian inflation data continued to cool off in the final quarter of 2024. Headline inflation as measured by the Consumer Price Index (CPI) came down on a year-over-year basis from 2.0% in October, to 1.9% in November, and reached 1.8% in December. The unemployment rate ticked up again over the course of Q4. December data put the unemployment rate at 6.7%, after reaching 6.8% in November, up from 6.5% in October. The Bank of Canada monitors this data closely as they make interest-rate decisions and aim to avoid creating a recessionary environment. Currency moves were another large part of the story in Q4 2024. Among the many factors influencing this was uncertainty swirling around potential tariffs from the U.S. government, which weakened the Canadian dollar in the last three months of 2024, as a strengthening U.S. currency pushed up the value of U.S. financial assets in Canadian dollar terms.

Global financial markets are likely to fluctuate as political developments and policy changes unfold in the U.S. Keeping your emotions in check – and staying focused on a plan that’s geared toward your goals and risk tolerance – can help you achieve long-term investing success. History shows that markets trend upward over time. Sudden moves, such as shifting into risk-adverse products like GICs and money market funds, could work against your long-term interests. Maintaining a diversified portfolio – with exposure to financial markets – is a better way to stay on track. If you have questions, a Co-operators financial representative is always ready to help.

Interested in more tips and insights? Check out our Market View page for investment basics and weekly updates on market performance. You can even sign up to have this news sent directly to your inbox.

Sales charges, expenses and other fees

Fees and expenses reduce the return on your investment. For details, please refer to your Policy and Information Folder.

Current rates of return are available on our Segregated Fund Performance page. Your personal rate of return will vary, depending on the contributions and withdrawals you make over time. For details, please refer to your Policy Statement.

If you have questions about your investments, contact your Co-operators financial representative.

Versatile Portfolios Navigator^TM is a flexible and secure investment option

Whether you’re saving for the unexpected, for retirement or for that big item on your bucket list, your path to financial success is unique. Versatile Portfolios Navigator^TM can provide you with the flexibility you need. In addition to select and diverse investment options from top, trusted investment managers, we offer a suite of portfolio funds – all actively managed and consisting of underlying funds – that help you take the guesswork out of investing.

Segregated funds and annuities are administered by Co-operators Life Insurance Company. Not all products are available in all provinces.

The information contained in this communication was obtained from sources believed to be reliable; however, we cannot guarantee that it is accurate or complete. This communication is provided as a general source of information and should not be considered personal investment advice or solicitation to buy or sell any investment. Co-operators is committed to protecting the privacy, confidentiality, accuracy and security of the personal information that we collect, use, retain and disclose in the course of conducting our business. Please refer to our privacy policy for more information. Co-operators® is a registered trademark of Co-operators Group Limited and is used with permission. Versatile Portfolios Navigator ^TM and Investing in your future. Together. ^TM are trademarks of Co-operators Life Insurance Company. True North® is a registered trademark of Fidelity Investments Canada ULC and used with permission. Versatile Portfolios Navigator™ is an investment product offered by Co-operators Life Insurance Company which may include features or options such as segregated funds, portfolios of segregated funds or guaranteed rates. Guaranteed benefits are payable upon death or upon maturity (reduced proportionately by withdrawals from, or investment transfers out of, the segregated funds). No guarantee is provided upon surrender or cancellation. Subject to any applicable death and maturity guarantee, any part of the premium or other amount that is allocated to a segregated fund is invested at the risk of the policyholder and may increase or decrease in value.

Returns, investment segmentation and top holdings as of December 31, 2024. Rates of return for periods less than one year are simple rates of return. All others are annualized rates of return. Securities regulations do not allow us to report performance for a fund that has been available for less than one year. The returns reflect changes in unit value and assume that all income/realized net gains are retained by the segregated fund in the periods indicated and are reflected in higher unit values of the fund. The returns do not take into account sales, redemption, distribution or other optional charges or income taxes payable that would have reduced returns or performance. Past performance of any fund is not necessarily indicative of its future performance.

If you have questions or want to discuss your investments, please contact your authorized financial representative.

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