Effective November 27, 2021, the deferred sales charge and low load sales charge purchase options will no longer be available for purchase on Sun Life Global Investments mutual funds. Switches between funds of the same sales charge purchase option will be permitted.

Sun Life Excel Emerging Markets Fund

Fund commentary | Q1 2021

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Opinions and commentary provided by Schroder Investment Management.

Emerging markets (EM) delivered positive returns in Q1 2021, with the fund outperforming its index. Country allocation was negative and stock selection positive.

At a country level, the overweights to Brazil and Turkey, both of which underperformed, and the zero-weight to Saudi Arabia, which outperformed, were the main headwinds. Brazil underperformed largely due to currency weakness as policy uncertainty increased and rising inflation forced the central bank to begin tightening interest rates. Turkey lagged as the central bank governor was unexpectedly replaced, ending short-lived hopes for more orthodox policy. Saudi Arabia was a beneficiary of the rebound in crude oil prices. These effects were partly offset by the overweight to South Africa, which outperformed, and the underweight to China, which underperformed. South Africa advanced following a positive reaction to the latest budget and as COVID-19 cases receded. China recorded a slightly negative return as rising expectations for policy normalisation, together with regulatory uncertainty for certain industries, and ongoing geopolitical concerns, dampened sentiment. 

Stock selection was positive in Taiwan (o/w Hon Hai Precision and ASE Technology; Hon Hai) outperformed on strong iPhone sales, potential for margin improvement and announcements regarding upcoming EV joint ventures. ASE rose from ongoing tightness in the backend supply of the semiconductor market, this coupled with recent anti-trust clearance means they can now extract synergies from the SPIL merger Russia (o/w Novatek; the energy company) rose on stronger LNG and energy prices and Korea (o/w Naver; the listing of the Korean ecommerce company in the US) highlighted a valuation differential.

Fund performance

Compound returns %1 Since inception2 7 year 5 year 3 year 1 year Q1
Sun Life Excel Emerging Markets Fund - Series A 3.6 8.3 12.1 6.5 45.4 1.9
Sun Life Excel Emerging Markets Fund - Series F 4.7 9.5 13.3 7.6 47.0 2.2
MSCI Emerging Markets Index 7.8 8.6 11.4 5.6 39.9 0.9

1Returns for periods longer than one year are annualized. Data as of March 31, 20210

2Partial calendar year. Returns are for the period from the fund’s inception date of September 1, 2011 to December 31, 2011.

Views expressed are those of Schroder Investment Management North America Inc., sub-advisor to select Sun Life mutual funds for which SLGI Asset Management Inc. acts as portfolio manager. 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, 2021. SLGI Asset Management Inc. is a member of the Sun Life group of companies. All rights reserved.