Equity Fund

September 30, 2022

Market Context

  • The Canadian stock market (S&P/TSX Composite Index) fell 1.4% in the third quarter. The communications, real estate, and energy sectors were especially weak
  • Global stocks, as measured by the Morningstar Developed Markets Index, were flat with the index posting a 0.0% return in Canadian dollar terms.

Portfolio Specifics

  • The fund holds 24 stocks, of which 12 are headquartered in Canada, 7 in the U.S., and 5 overseas.
  • The portfolio declined modestly in Q3 (-0.8%), largely in line with the markets. Our Canadian investments were stronger than our American holdings, but a surging U.S. dollar (+6%) boosted the returns of the latter. Volatility accelerated in August when investor sentiment turned sour once again on heightened inflation concerns.
  • Our manager, Fiera Capital, has been pleased with the operating performance of our holdings and feels our business’ results are not being reflected in their share prices. Companies such as CN Rail (railways), CCL Industries (packaging), Metro (groceries), Telus (telecom), and Zoetis (animal health) have turned in steady profits. To be sure, these are boring businesses but they’re well run, have strong demand, and revenues that should hold up relatively well in an economic slowdown.
  • Potash producer Nutrien was our top performing stock in the quarter and is up 45% over the past year. The business continues to turn in good numbers and the long-term outlook for fertilizers remains compelling. That said, we trimmed the stock given its run up in price. On the flip side, CAE (maker of flight simulators) was our worst performer, down 33%, after announcing a disappointing quarterly profit.
  • We don’t own any oil & gas producers, which was advantageous in the period as the price of oil fell 25%. Nevertheless, this positioning has worked against us this year given the energy sector’s rise. Fiera continues to believe there are better opportunities elsewhere, but would revisit certain oil stocks at the right price.
  • One new stock was purchased, HDFC Bank. The company is India’s largest private sector bank and is among the largest in the world by market cap. HDFC has a good record of underwriting and an excellent growth outlook. To fund the purchase, we sold Experian, the Dublin-based consumer credit reporting company. Experian was a solid investment for us—we owned it for 10 years—but Fiera felt it was a good time to switch some of our European exposure to a faster-growing market.


  • The fund is comprised of a concentrated group of businesses operating in a diverse array of industries, from information services to renewable energy to packaging. Our manager’s focus is on best-in-class companies that generate strong cash flows, have good growth prospects, and are well financed.

Commissions, trailing commissions, management fees and expenses all may be associated with mutual fund investments. Important information about the Steadyhand funds is contained in our Simplified Prospectus. Please read the prospectus before investing. Mutual funds are not guaranteed, their values change frequently, and past performance may not be repeated.