Q4 2025 Fund Commentary

Commentary and opinions are provided by Mackenzie Investments.

Market commentary

Emerging markets navigated a firmer environment in the fourth quarter as moderating inflation, additional U.S. Federal Reserve Board interest rate cuts and a weaker U.S. dollar improved financial conditions. Monetary easing across several major economies supported investment, while stronger earnings momentum in Asia and parts of Latin America helped offset lingering global trade uncertainty.

Emerging market equities advanced, benefiting from broadening market leadership outside the U.S. Asian markets, including China, Taiwan and South Korea, saw renewed investor interest as demand for artificial intelligence (AI) infrastructure and semiconductor components remained robust. Latin American markets were supported by resilient earnings and supportive monetary conditions.

Industrials and financials were relative outperformers, aided by infrastructure spending and steady domestic demand in several key emerging economies. Technology?related equities again led gains across Asia, while consumer?oriented sectors saw mixed results amid uneven global trade flows and lingering tariff pressures.

Performance

Relative overweight exposure to SK Hynix Inc. and Fresnillo PLC contributed to the Fund’s performance. SK Hynix shares rose because of demand for memory chips and higher pricing. Fresnillo stock rose because of higher silver and gold prices.

Relative overweight exposures to Pop Mart International Group Ltd., Sunny Optical Technology Group Co. Ltd. and Zhejiang Leapmotor Technology Co. Ltd. detracted from the Fund’s performance. Pop Mart International Group was affected by softer consumer sentiment and slower-than-expected recovery in discretionary spending. Sunny Optical Technology Group saw weaker shipment trends for optical lenses and continued margin pressure. Zhejiang Leapmotor Technology shares fell because of weakening sentiment toward the electric vehicle market, pricing competition and concerns over profitability.

At a sector level, security selection in the information technology, materials and communication services sectors contributed to the Fund’s performance. Selection in the financials, industrials and utilities sectors detracted from performance.

At a regional level, selection in India and Taiwan contributed to the Fund’s performance. Security selection in South Korea, Brazil and Turkey detracted from performance.

At a factor level, exposure to growth equities detracted from the Fund’s performance.

Portfolio activity

Activity in the Fund is driven by stock selection, optimization and the sub-advisor’s vetting process, which is run daily.