Insurance, Investments and Group Benefits

This past week has been marked by significant developments in the United States, highlighted by President Donald Trump's conclusive electoral triumph, along with a policy adjustment from the Federal Reserve, which elected to reduce the overnight interest rates by 25 basis points. In response to these pivotal events, the Empire Life Investments Inc. team provides some explanation of the prospective implications on financial markets, with a particular focus on the U.S. market. The informed perspectives of Ashley Misquitta, Investment Strategist and Senior Portfolio Manager and Ian Fung, Senior Portfolio Manager have been collated and are presented here for a fuller understanding of the anticipated market dynamics.

Paul Holba, Senior Vice-President and CIO of Empire Life Investments Inc. discusses some of the key themes the investment team will monitor as we head into the second half of 2024.

Key takeaways:  

• Exposure to international equities was increased by 0.25%-1.5%
• Exposure to US equities was decreased by 0.25%-1.5%
• Our exposures to the other asset classes were rebalanced back to target
  

Key takeaways:  

• Tactically moving to a more defensive positioning
• Increased bonds, decreased equities (all portfolios except Emblem Aggressive Growth, which has no bond component)
• Emblem Aggressive Growth – increased US equities, decreased international equities
  
  

Tactical update - December 20, 2022

We are choosing to adopt a more cautious posture and see increasingly attractive relative value in fixed income. As such, we have reduced our equity targets in the various Emblem funds and increased our fixed income targets.

Key takeaways: Tactically increased bonds, decreased international equities*

Tactical update - January 27, 2022

We are taking a slightly more defensive posture by trimming international equities and adding to bonds. This is indeed a tactical, but measured decision. It is a move in a more conservative direction with an eye towards taking potential risk exposures incrementally lower.

Key takeaways:

Emblem Portfolios - Canadian: September 22, 2021
Emblem GIF Portfolios - Global: September 27, 2021

• Incrementally less aggressive outlook/positioning towards risk assets
• Deploying cash to realign select asset class exposures back to targets
  
  

Highlights:

• Strong sustainable investing interest in the current environment
• Record fund flows into Canadian sustainable investment funds
• Wide interest/usage gap and demographic factors allude to potential for greater fund flows
• Discussion and education will be important drivers going forward

From an evidence point of view, the proliferation of sustainable investment strategies and strong fund flows into these products are easily researched through publicly available resources. Underlying these trends, however, is a more durable structural shift.

Myth #3: Sustainable investing is a fad

Myth #2: All sustainable investing approaches are essentially the same

It is vital in understanding the different approaches related to sustainable investing. While standards and definitions continually evolve, there are generally six approaches to sustainable investing. Depending on an investor’s motivation in considering sustainable investing, some approaches may be more relevant than others. 

Sustainable investing has experienced increased interest over the past few years, with a sharp acceleration in 2020 due to the COVID-19 pandemic and other high profile social issues, such as the Black Lives Matter movement. There are, however, some common myths and misconceptions among investors that may be new to modern sustainable investing approaches. This educational resource attempts to provide insight and clarification into what we believe are the most misunderstood issues.

Myth #1: Sustainable investing is the same as ethical investing