Sun Life Real Assets Private Pool
Global equity markets finished the fourth quarter ending December 31, 2024 (Q4) in positive territory. U.S. equities rose as the incoming U.S. President’s platform of pro-growth policies boosted expectations. But trade and geopolitical uncertainties weighed on international and emerging markets. In this environment, real assets posted negative performance.
The Sun Life Real Assets Privat Pool Fund Series F (the Fund) returned -4.9% in Q4 and underperformed its benchmark. All three components-infrastructure, real estate, and resources -produced negative returns and underperformed their underlying benchmark.
The infrastructure component of the Fund invests in assets with high revenue certainty, profitability and lower volatility. The strategy remains biased towards Europe, where valuations remain favourable and does not invest in energy. On a relative basis, the underweight to energy drove the detraction from benchmark returns. Within stock selection, positions in European regulated utilities detracted while positions in Spanish toll roads and Hong Kong diversified utilities contributed.
The real estate component of the Fund invests in higher quality real estate and generally looks to invest in property types experiencing real cash flow growth, with strong balance sheets and managed by skillful teams. Stock selection remains the primary driver of returns. The strategy continues to favour apartments, manufactured homes, self-storage and industrial properties as well as grocery-anchored strip malls.
The resources component invests in clean energy, water, and agricultural assets. Resource scarcity is a fundamental theme of this strategy. This component invests in companies that aim to improve the efficiency of food, energy and water supply. It also invests in companies that provide mitigation and adaptation solutions to climate change. While an underweight in materials and overweight in industrials contributed to performance, an underweight position in utilities and stock selection in information technology hurt performance.
| Compound returns %1 | Since inception | 10 Year | 5 Year | 3 Year | 1 Year | Q4 |
|---|---|---|---|---|---|---|
| Sun Life Real Assets Private Pool - Series A | 4.5 |
-- |
5.0 |
0.0 |
4.5 |
-5.2 |
| Sun Life Real Assets Private Pool - Series F | 5.6 |
-- |
6.2 |
1.2 |
5.7 |
-4.9 |
| Benchmark2 | 6.0 |
-- |
5.7 |
5.5 |
12.2 |
-1.9 |
¹Returns for periods longer than one year are annualized. Data as of December 31, 2024.
Fund inception date: February 2, 2015.
2Blended 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$).
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 subject to change and 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.
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.