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 Global Tactical Yield Private Pool

Fund commentary | Q4 2020

Download PDF

Opinions and commentary by Sun Life Global Investments.

Global equities bookended 2020 with record highs at the start and end of the year. In between, COVID-19 swept across the world, triggering the sharpest decline into a bear market in history. Economies shut down; millions of people lost their jobs. If that wasn’t enough, markets had to digest a disputed U.S. election, with an angry president sowing chaos. Still, vaccines arrived; President-elect Joe Biden promised a calmer White House and Congress finally delivered a $900-billion stimulus package. With that, markets ended a very tough year on a roll, with investors looking beyond a slowing economy and COVID-19’s deadly second wave.

Over the course of the year, we believed three things had to happen to move the market higher. First, we needed to get the contentious U.S. election behind us. Second, vaccines had to be approved and rolled out. Third, a U.S. stimulus package was required to keep the largest global economy’s recovery on course. Overall, with all three now in place we feel more optimistic as we head into 2021.

This is not to say it will be clear sailing. Far from it. The virus is still running rampant in many countries including the U.S. with nearly 20,000 new cases a day. Nor is the economy bouncing back as quickly as many had hoped, and we could see a further slowdown in the first quarter. However, on the positive side, corporate earnings may remain strong. In fact, based on our current market outlook, we could see market returns in the high single or possibly even double digits by year-end.

Still, there is this important caveat: it all depends on a smooth, rapid roll out of the vaccines. As noted, if there are widespread side effects, lack of people taking it or distribution problems, it would certainly change our view. Hopefully, none of this will occur.

The Sun Life Global Tactical Yield Private Pool entered the fourth quarter positioned for an environment of roughly balanced risks. Some cash was available to put to work if and when some of the risks to our outlook subsided.  In early November, as we cleared the U.S. election and received strong vaccine trial results from Pfizer, we reallocated this cash to global equities, taking the equity position to an overweight, at 53% of the portfolio. After the multiple announcements of positive results on the development of COVID-19 vaccines, we expected the market would begin to price in a durable economic recovery, which came to fruition in the form of higher equities markets over the last two months of the year. Within the bond component of the Pool, we continued to maximize our allocation to alternative fixed income - looking to take advantage of ongoing opportunities within global credit markets.

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.

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.