More investors are turning to ETFs, and are looking at which fund strategies best serve their goals and portfolios.
And while the funds are traditionally viewed as passive investment vehicles, an increasing number of active and strategy-based products are flooding the market to help investors score better returns despite global market instability.
National Bank’s defensive ETF portfolio, for example, was designed to help investors maintain market exposure during the continued downturn.
It offers exposure to staples and metals equities, as well as to fixed income and cash. And over the last year, the fund’s performance has improved by 2.8%, with 4.3% annualized volatility.
In comparison, the Canadian market has produced a negative 3.3% return and 17.3% volatility.
Last week, the bank released the specific one-year performance results of the fund. They revealed its overall performance reflected, “The market crisis over the past year focused most on the European sovereign debt difficulties. But, this crisis was less impactful than the subprime meltdown of 2008/09.”
Economies worldwide are weak, but this suggests your clients shouldn’t be held back by fear; many markets have improved since the 2008 recession and there are opportunities they can take advantage of.
Within the fund, fixed Income was the strongest performer. Canadian aggregate bonds were up 4.9% to 6.2%, corporate bonds rose 6.8% to 7.5% and short-term bonds climbed 2.2% to 2.3%.
Read: Don’t give up on bonds
Consumer Staples did well over the past 12 months, producing returns of 18.3%. They offset poor performance of gold, which plummeted by about 24%.
Read more about National Bank’s defensive portfolio, and about how it was constructed and tested.