Third Quarter Median Canadian Plan Sponsor Returns Stay Positive With Healthy Equity Returns Offsetting Negative Fixed Income Returns, According to BNY Mellon Canadian Master Trust Universe

70 per cent of plans within the BNY Mellon Canadian Master Trust Universe produced positive results this quarter. 

TORONTO, Nov. 1, 2017 /CNW/ - The median return of the BNY Mellon Canadian Master Trust Universe, a BNY Mellon Global Risk Solutions fund-level tracking service, was +0.55% for the third quarter of 2017, marking the sixth straight quarter of positive results. The one-year return of +6.14% was just below the Canadian Master Trust Universe's 10-year annualized return of +6.17% and also marks the sixth consecutive quarter of positive one-year performance.

With a market value of more than $232.8 billion and an average plan size of $2.7 billion, the BNY Mellon Canadian Master Trust Universe is a fund-level tracking service that can be used to make peer comparisons of performance by plan type and size. It consists of 87 Canadian corporate, public and university pension plans. Additional insight of the Canadian Master Trust Universe data is provided by BNY Mellon's Asset Strategy View, and the Universe product extension, Asset Allocation Trust Universe. "The peer group comparison offered by the BNY Mellon Canadian Master Trust Universes can provide insight for understanding asset allocation trends and performance metrics.  This can be valuable for Canadian pension plans and university endowments, as well as investment boards, to help them to evaluate and benchmark their own investment strategies," said Tim Rourke, Vice President, Segment Lead, Pensions and Asset Owners, CIBC Mellon.

"The Canadian plans remained positive in the third quarter of 2017 with 70% of the plans posting positive results and a median return for the quarter of +0.55% and a 2017 year-to-date median return of +5.32%. The Canadian foundations and endowments posted the best median return for the third quarter (+1.22%), followed by Canadian Universities' median return of +0.88%," said Catherine Thrasher, Managing Director, Global Risk Solutions Canada, BNY Mellon Asset Servicing. "The top performing asset class in the third quarter is Canadian equities with a median return of +3.40%. International equity was the best performing asset class over the one year time horizon (+14.74%).Fixed income underperformed in the third quarter and one year time horizons with a median returns of -2.01% and -3.01%, respectively."

Q3 Highlights of the BNY Mellon Canadian Master Trust Universe

• 70% of plans posted positive results during the quarter; median returns for plans over $1 billion outperformed the median of the BNY Mellon Canadian Master Trust Universe by seventeen basis points for Q3 2017.
• Canadian foundations and endowments posted the highest median return for the third quarter +1.22% followed by Canadian Universities with a median return of +0.88%.
• Canadian equity posted a quarterly median return of +3.40%, versus the S&P/TSX Composite Index return of +3.68%. U.S. equity's median quarterly return of +0.60% nearly matched the S&P 500 Index result of +0.61%. International equity and non-Canadian equity, with median returns of +1.49% and +1.41%, reported mixed results versus the MSCI EAFE Index and MSCI World Index returns of +1.56% and +1.08%, respectively.
• Further insight on international equities from the BNY Mellon Asset Allocation Trust Universes indicate Canadian large cap equities posted the highest median results for the quarter, +3.90%, surpassing the S&P TSX Index by 22 basis points. Median returns from Canadian long duration fixed income (-4.03%) and Canadian government bonds (-1.78%) were underperformers in the third quarter.
• Fixed Income performance was negative during the third quarter with a median return of -2.01%, versus the FTSE TMX Canada Bond Universe Index return of -1.84%.
• Alternative asset classes were led by real estate, reporting a median return of +1.36%, followed by private equity +0.52%, infrastructure +0.42%, and hedge funds -0.92% in the third quarter, as reported by the Asset Allocation Trust Universes.

BNY Mellon Canadian Master Trust Universe Median Plan Returns*

Universe Medians		3Q 2017 %	One- Year %	Three- Years %	Five- Years %	Ten- Years %
Canadian Master Trust Total Fund		0.55	6.14	7.40	9.80	6.17
	Canadian Equity	3.40	10.28	5.54	10.35	4.71
	U.S. Equity	0.60	13.17	14.71	20.57	10.08
	International Equity	1.49	14.74	10.77	14.62	5.07
	Non-Canadian Equity	1.41	14.42	12.65	17.40	7.30
	Fixed Income	-2.01	-3.01	3.80	3.33	5.69
	Real Estate	1.36	7.43	6.15	8.19
Canadian Foundations & Endowments		1.22	8.30	7.72	10.08	6.39
Canadian Universities		0.88	7.75	7.48	10.10	6.39

*All returns are posted gross of fee results, calculated in Canadian dollars.

Information containing any historical information, data or analysis should not be taken as an indication or guarantee of any future performance, analysis, forecast or prediction. Past performance does not guarantee future results. The Information should not be relied on and is not a substitute for the skill, judgment and experience of the user, its management, employees, advisors and/or clients when making investment and other business decisions. None of the Information constitutes an offer to sell (or a solicitation of an offer to buy), any security, financial product or other investment vehicle or any trading strategy. Some products or services are available only through BNY Mellon.

About CIBC Mellon
CIBC Mellon is a Canadian company exclusively focused on the investment servicing needs of Canadian institutional investors and international institutional investors into Canada. Founded in 1996, CIBC Mellon is 50-50 jointly owned by The Bank of New York Mellon (BNY Mellon) and Canadian Imperial Bank of Commerce (CIBC). CIBC Mellon's investment servicing solutions for institutions and corporations are provided in close collaboration with our parent companies, and include custody, multicurrency accounting, fund administration, recordkeeping, exchange-traded fund services, pension services, securities lending services, foreign exchange processing and settlement, and treasury services. As at September 30, 2017, CIBC Mellon had more than C$1.8 trillion of assets under administration on behalf of banks, pension funds, investment funds, corporations, governments, insurance companies, foreign insurance trusts, foundations and global financial institutions whose clients invest in Canada. CIBC Mellon is part of the BNY Mellon network, which as at September 30, 2017 had US$32.2 trillion in assets under custody and/or administration. CIBC Mellon is a licensed user of the CIBC trade-mark and certain BNY Mellon trade-marks, is the corporate brand of CIBC Mellon Global Securities Services Company and CIBC Mellon Trust Company, and may be used as a generic term to refer to either or both companies.

For more information, including CIBC Mellon's latest knowledge leadership on issues relevant to institutional investors active in Canada, visit www.cibcmellon.com.

SOURCE CIBC Mellon

Jennifer Israel, Corporate Communications, CIBC Mellon, 416-643-6538, [email protected]

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