Q4 2025 Fund Commentary

Commentary and opinions are provided by Mackenzie Investments.

Market commentary

The global economy remained resilient in the fourth quarter despite policy uncertainty and the effects of the prolonged U.S. government shutdown. Investor sentiment improved as inflation eased across major regions and expectations grew for continued monetary and fiscal policy support into 2026. Non?U.S. markets benefited from a weaker U.S. dollar and improving valuations, while Asia and Europe saw stronger earnings momentum.

Central banks maintained or extended easing cycles. The U.S. Federal Reserve Board delivered additional rate cuts in October and December, while other major policymakers signaled that accommodative policy conditions will persist. These measures helped sustain risk appetite even as global manufacturing remained soft.

Global equity markets rose. The MSCI World Index approached record levels, supported by solid earnings, broadening participation beyond U.S. mega?capitalization stocks and continued enthusiasm for AI. Emerging markets outperformed developed market peers, helped by improved sentiment, a favourable currency backdrop and stronger relative earnings trends.

Performance

Overweight allocations to Taiwan and South Korea contributed to the Fund’s performance. Underweight allocations to the real estate and energy sectors also contributed to performance. A holding in Eli Lilly and Co. contributed to performance as the company’s revenue growth exceeded market expectations. Not holding Oracle Corp. contributed to performance as the company’s stock price declined after a Fund holding in the company was sold.

Stock selection in the U.S. detracted from the Fund’s performance. Stock selection in the industrials, information technology and consumer discretionary sectors also detracted from performance. A holding in Ferrari NV detracted from performance as the company’s long-term financial targets for 2030 were perceived by investors as overly conservative. A holding in RELX PLC detracted from performance as tepid sentiment towards data and analytics industries led investors to rotate into riskier or cyclical sectors, in the sub-advisor’s view.

In fixed income, long-duration (sensitivity to interest rates) federal government bonds contributed to the Fund’s performance, while an overweight allocation to provincial government bonds detracted from performance.

Portfolio activity

Holdings in Eli Lilly and Johnson & Johnson were added to the Fund as the sub-advisor believes they are high-quality health care companies with attractive valuations, and that the health care sector is well positioned for strong growth.

A holding in Alphabet Inc. was added to the Fund to capture the upside of an early artificial intelligence (AI) leader, in the sub-advisor’s view. The Fund’s holding in Meta Platforms Inc. was increased as the sub-advisor believes the company has unmatched scale, a dominant position and the ability to integrate AI tools.

The Fund’s holding in Oracle Corp. was sold after the company’s stock reached an all-time high and the sub-advisor had concerns about the levels of debt the company took on to expand. A holding in Wolters Kluwer NV was sold because of the sub-advisor’s concerns about the company’s competitive moat and margin pressure.

Fund holdings in IDEXX Laboratories Inc. and Ferrari were decreased during the quarter.