As of July 20, 2020, Sun Life Global Investments (Canada) Inc. changed its name to SLGI Asset Management Inc. It will take some time to update our websites, materials and forms and until that is complete, all references to Sun Life Global Investments (Canada) Inc. will mean SLGI Asset Management Inc. We’ve also brought together Sun Life mutual fund, segregated fund, annuity and guaranteed investment product businesses under the collective brand of Sun Life Global Investments.

Sun Life Real Assets Private Pool

Fund commentary | Q3 2020

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Following the sharp selloff in Q1 and subsequent rally in Q2, real asset indices were roughly flat during the third quarter. 

The fund outperformed its benchmark during the third quarter. The global renewable resources component of the Fund, in particular, drove strong absolute and relative returns.

In terms of relative positioning, the Fund maintains a bias away from global REITs and infrastructure, with a tilt towards resources and a small allocation to money market. The latter was initiated in the second quarter for capital preservation and near-term flexibility. 

The infrastructure component of the Fund favours assets with high revenue certainty, profitability and lower volatility. Stock selection remains the main driver of returns. Positions in U.S. railroads contributed to relative performance during the quarter, while positions in European toll roads and U.K. diversified utilities detracted.

The real estate component of the Fund favours higher quality real estate and generally looks to invest in property types with real cash flow growth and strong balance sheets, managed by skillful teams. The strategy continues to favour apartments, manufactured homes, self-storage and industrial properties.

The resources component focuses on clean energy, water, and agriculture. Resource scarcity is a fundamental underpinning of the strategy, which invests in companies providing solutions to demand, supply and efficiency in the provision of food, energy, water, as well as mitigation and adapting to the impact of climate change. Renewable energy was the standout performer on an absolute and relative basis, benefitting from becoming a central theme to fiscal stimulus packages around the world. From a sector perspective, the strongest contributors to performance were the significant overweight positions in information technology (renewable energy) and industrials (renewable energy and water), as well as significant underweight to energy (no exposure to fossil fuels). 

Fund performance

Compound returns %1 Since inception2 5 Year 3 Year 1 Year Q3
Sun Life Real Assets Private Pool - Series A

2.7

4.6

1.8

-0.5

4.2

Sun Life Real Assets Private Pool - Series F

3.9

5.7

3.0

0.6

4.5

Benchmark3

3.7

4.5

0.6

-13.0

0.0

¹Returns for periods longer than one year are annualized. Data as of September 30, 2020.

²Partial calendar year. Returns are for the period from the fund’s inception date of February 2, 2015 to December 31, 2015.

³Blended benchmark comprised of: 35% FTSE EPRA/NAREIT Developed Real Estate Index (C$),35% S&P Global Infrastructure Index (C$), 30% S&P Global Natural Resource Index (C$).

On May 31, 2019, Sun Life Real Assets Fund, previously Sun Life Infrastructure Fund, changed its name and underwent a change in investment objective. On February 26, 2020 Sun Life Real Assets Fund was renamed Sun Life Real Assets Private Pool.

Learn more about Sun Life Private Investment Pools

Views expressed regarding a particular company, security, industry or market sector should not be considered an indication of trading intent of any mutual funds managed by SLGI Asset Management Inc. These views are not to be considered as investment advice nor should they be considered a recommendation to buy or sell. This commentary is provided for information purposes only and is not intended to provide specific individual financial, investment, tax or legal advice. Information contained in this commentary has been compiled from sources believed to be reliable, but no representation or warranty, express or implied, is made with respect to its timeliness or accuracy.

This commentary may contain forward-looking statements about the economy and markets, their future performance, strategies or prospects or events and are subject to uncertainties that could cause actual results to differ materially from those expressed or implied in such statements. Forward-looking statements are not guarantees of future performance and are speculative in nature and cannot be relied upon.

Commissions, trailing commissions, management fees and expenses all may be associated with mutual fund investments. Investors should read the prospectus before investing. Mutual funds are not guaranteed, their values change frequently and past performance may not be repeated.  The indicated rates of return are the historical annual compounded total returns including changes in security value and reinvestment of all distributions and do not take into account sales, redemption, distribution or other optional charges or income taxes payable by any security holder that would have reduced returns. Mutual funds are not guaranteed, their values change frequently and past performance may not be repeated.

While Series A and Series F securities have the same reference portfolio, any difference in performance between these series is due primarily to differences in management fees and operating fees. The management fee for Series A securities also includes the trailing commission, while Series F securities does not. Series A securities of the fund are available for purchase to all investors, while Series F securities are only available to investors in an eligible fee-based or wrap program with their registered dealer. Investors in Series F securities may pay a separate fee-based account fee that is negotiated with and payable to their registered dealer.

Sun Life Global Investments is a trade name of SLGI Asset Management Inc., Sun Life Assurance Company of Canada and Sun Life Financial Trust Inc.

SLGI Asset Management Inc. is the investment manager of the Sun Life Mutual Funds, Sun Life Granite Managed Solutions and Sun Life Private Investment Pools.

© SLGI Asset Management Inc. and its licensors, 2020. SLGI Asset Management Inc. is a member of the Sun Life group of companies. All rights reserved.