Canadian investment plans posted negative returns for the first quarter of this year as sinking bonds provided no protection from volatile equities markets, according to BNY Mellon.
The BNY Mellon Canadian Master Trust Universe, which tracks 85 Canadian corporate, public and university pension plans managing $306.5 billion in assets, saw a median return of -4.61% in Q1.
“Canadian pension plan sponsor returns were negative in the first quarter of 2022 due to the ramifications of Russia invading Ukraine, surging inflation and the continued supply chain disruptions caused by the Covid-19 lockdowns,” said David Cohen, BNY Mellon’s director of global risk solutions, in a release.
Canadian equities performed best for the plans, with a median return of 0.44%, while returns for international equities were the lowest at -8.29%.
Those portions of plans performed worse than broad indexes: the S&P/TSX Composite index returned 3.96% in Q1, BNY Mellon said, while the MSCI EAFE index returned -0.78%.
The -7.62% median fixed-income return in plans also underperformed the FTSE Canada Universe Bond index, which returned -2.99%.
Alternative investments fared better in the first quarter. The plans’ real estate assets returned 4.65% over the first three months, while private equity eked out a 0.61% median return. Hedge funds reported a return of -0.10%.
The one-year median return for the plans in the BNY Mellon universe was 4.48% and the 10-year return was 8.25%. All returns are posted gross of fee results.