You are currently viewing the Canadian Institutional website. You can change your location here or visit other RBC GAM websites.

Welcome to the RBC Global Asset Management site for Institutional Investors
Français

In order to proceed to the site, please accept our Terms & Conditions.

Please read the following terms and conditions carefully. By accessing rbcgam.com and any pages thereof (the "site"), you agree to be bound by these terms and conditions as well as any future revisions RBC Global Asset Management Inc. ("RBC GAM Inc.") may make in its discretion. If you do not agree to the terms and conditions below, do not access this website, or any pages thereof. Phillips, Hager & North Investment Management is a division of RBC GAM Inc. PH&N Institutional is the institutional business division of RBC GAM Inc.

No Offer

Products and services of RBC GAM Inc. are only offered in jurisdictions where they may be lawfully offered for sale. The contents of this site do not constitute an offer to sell or a solicitation to buy products or services to any person in a jurisdiction where such offer or solicitation is considered unlawful.

No information included on this site is to be construed as investment advice or as a recommendation or a representation about the suitability or appropriateness of any product or service. The amount of risk associated with any particular investment depends largely on the investor's own circumstances.

No Reliance

The material on this site has been provided by RBC GAM Inc. for information purposes only and may not be reproduced, distributed or published without the written consent of RBC GAM Inc. It is for general information only and is not, nor does it purport to be, a complete description of the investment solutions and strategies offered by RBC GAM Inc., including RBC Funds, RBC Private Pools, PH&N Funds, RBC Corporate Class Funds and RBC ETFs (the "Funds"). If there is an inconsistency between this document and the respective offering documents, the provisions of the respective offering documents shall prevail.

RBC GAM Inc. takes reasonable steps to provide up-to-date, accurate and reliable information, and believes the information to be so when published. Information obtained from third parties is believed to be reliable, but no representation or warranty, express or implied, is made by RBC GAM Inc., its affiliates or any other person as to its accuracy, completeness, reliability or correctness. RBC GAM Inc. assumes no responsibility for any errors or omissions in such information. The views and opinions expressed herein are those of RBC GAM Inc. and are subject to change without notice.

About Our Funds

The Funds are offered by RBC GAM Inc. and distributed through authorized dealers. Commissions, trailing commissions, management fees and expenses all may be associated with the Funds. Please read the offering materials for a particular fund before investing. The performance data provided are historical returns, they are not intended to reflect future values of any of the funds or returns on investment in these funds. Further, the performance data provided assumes reinvestment of distributions only and does not take into account sales, redemption, distribution or optional charges or income taxes payable by any unitholder that would have reduced returns. The unit values of non-money market funds change frequently. For money market funds, there can be no assurances that the fund will be able to maintain its net asset value per unit at a constant amount or that the full amount of your investment in the fund will be returned to you. Mutual fund securities are not guaranteed by the Canada Deposit Insurance Corporation or by any other government deposit insurer. Past performance may not be repeated. ETF units are bought and sold at market price on a stock exchange and brokerage commissions will reduce returns. RBC ETFs do not seek to return any predetermined amount at maturity. Index returns do not represent RBC ETF returns.

About RBC Global Asset Management

RBC Global Asset Management is the asset management division of Royal Bank of Canada ("RBC") which includes the following affiliates around the world, all indirect subsidiaries of RBC: RBC GAM Inc. (including Phillips, Hager & North Investment Management and PH&N Institutional), RBC Global Asset Management (U.S.) Inc., RBC Global Asset Management (UK) Limited, RBC Global Asset Management (Asia) Limited, BlueBay Asset Management LLP, and BlueBay Asset Management USA LLC.

Forward-Looking Statements

This website may contain forward-looking statements about general economic factors which are not guarantees of future performance. Forward-looking statements involve inherent risk and uncertainties, so it is possible that predictions, forecasts, projections and other forward-looking statements will not be achieved. We caution you not to place undue reliance on these statements as a number of important factors could cause actual events or results to differ materially from those expressed or implied in any forward-looking statement. All opinions in forward-looking statements are subject to change without notice and are provided in good faith but without legal responsibility.

Accept Decline
org.apache.velocity.tools.view.context.ChainedContext@35e466a6
by  RBC Global Equity teamJ.Richardson May 12, 2022

Stock markets have been reeling under macroeconomic pressures throughout the course of April. Spiking COVID-19 cases in China resulted in the prolonged lockdown of Shanghai and caused further disruption to global supply chains that have already been impacted by geopolitical tensions.

In this latest update, Senior Portfolio Manager, Jeremy Richardson, reflects on the month’s volatility, but also the underappreciated alpha opportunities still latent in businesses.

Watch time: 4 minutes 12 seconds

View transcript

Hello this is Jeremy Richardson from the RBC Global Equity Team here with another update.

I used to work with a colleague who always used to say that bad news came in threes. Usually, he was talking about company announcements, but it feels as though the bad news has been coming in terms of the geopolitics and macro situation. Obviously, first of all we had the global pandemic which had the effect of significantly disrupting supply chains, which in itself was quite inflationary as we ended up exiting the pandemic.

But obviously in February and March we saw the invasion of Ukraine by Russia which had a profound impact on a number of different levels but, from an economic point of view, very significant price increases from energy and again supply chains being disrupted. Now as April has drawn to a close, we have the possibility of a third impact, being the arrival of more widespread coronavirus infections in China. Shanghai has been locked down for a number of weeks now, and there are concerns that Beijing may be forced to take similar steps. The consequence of this could be significant for global supply chains and present a third, and very unwelcome, macroeconomic disruption which has the potential to be inflationary again.

Now the reason to mention all of this is that stock markets have been reeling under these pressures throughout the course of April, down about 8% in US dollar terms over the month, and unfortunately what often happens at this time of year with the Q1 earning season is that investors’ attention focuses back on the company fundamentals.

But in the face of this macroeconomic bad news, investors have instead been somewhat distracted from the individual company announcements. Moreover, company management teams, although they’ve been able to report results which have generally been better than the market has been expecting, the focus has very much been instead on the outlook statements from companies. And given the amount of uncertainty and the fact that it’s so early in the calendar year, a lot of those outlook statements have left something to be desired, which has meant that there hasn’t been that sort of positive dynamic to equity markets over the course of the month.

However, we always need to look forward and I think as investors we’ve really been focusing on two things.

Firstly, our source of alpha, which we still very much believe in. We would observe that in the current amount of volatility that we’re seeing in markets, investors have been focusing very much on the short-term, particularly on tangible value and short-term cash flows, and ignoring a lot of those longer-term or intangible drivers of long-term value creation. Out of sight is out of mind, so to an extent the fact that they have been overlooking these sources of longer-term value creation, that, to our mind, means that there seems to be significant amount of opportunity of under appreciated alpha latent in a lot of these great businesses we try and invest in.

The second thing we’ve been thinking about is the risk profile of a portfolio, given it’s increase in heightened volatility. And we think it’s very important to maintain that discipline of having a well-balanced portfolio, for when the focus does settle down and re focuses again on those longer-term value drivers, it’s really important that the portfolio is well balanced and in a good position to capture that alpha when it starts to come through again.

I hope that’s been of interest, and I look forward to catching up with you again soon.

Disclosure

This website and its contents (the “Site”) has been provided by RBC Global Asset Management (“RBC GAM”) for informational purposes only and may not be reproduced, distributed or published without the written consent of RBC GAM or its affiliated entities listed herein.

In Canada, this Site is provided by RBC Global Asset Management Inc. (including PH&N Institutional) which is regulated by each provincial and territorial securities commission with which it is registered. In the United States, this Site is provided by RBC Global Asset Management (U.S.) Inc., a federally registered investment adviser. In Europe, this Site is provided by RBC Global Asset Management (UK) Limited, which is authorised and regulated by the UK Financial Conduct Authority. In Asia, this Site is provided by RBC Global Asset Management (Asia) Limited to professional, institutional investors and wholesale clients only and not to the retail public. RBC Global Asset Management (Asia) Limited is registered with the Securities and Futures Commission in Hong Kong.

RBC GAM is the asset management division of Royal Bank of Canada (“RBC”) which includes RBC Global Asset Management Inc., RBC Global Asset Management (U.S.) Inc., RBC Global Asset Management (UK) Limited, RBC Global Asset Management (Asia) Limited, and BlueBay Asset Management LLP, which are separate, but affiliated subsidiaries of RBC.

Nothing contained in or on the Site should be construed as a solicitation of an offer to buy or offer, or recommendation, to acquire or dispose of any security, commodity, investment or to engage in any other transaction. This Site is not intended to provide legal, accounting, tax, investment, financial or other advice and such information should not be relied upon for providing such advice. RBC GAM takes reasonable steps to provide up-to-date, accurate and reliable information, and believes the information to be so when produced. The information, including layout, of this Site, may be wholly or partially suspended, withdrawn or changed at any time. We also reserve the right at any time to immediately suspend the provision of all or any part of this Site to you and/or block your access to this Site.

Information obtained from third parties is believed to be reliable, but no representation or warranty, express or implied, is made by RBC GAM, its affiliates or any other person as to its accuracy, completeness, reliability or correctness. The views and opinions expressed herein are those of RBC GAM and are subject to change without notice.

Any investment processes described in this Site may change over time. The characteristics set forth in this Site are intended as a general illustration of some of the criteria considered in selecting securities for client portfolios. Not all investments in a client portfolio will meet such criteria.

Past performance is not indicative of future results. With all investments there is a risk of loss of all or a portion of the amount invested. Where return estimates are shown, these are provided for illustrative purposes only and should not be construed as a prediction of returns; actual returns may be higher or lower than those shown and may vary substantially, especially over shorter time periods. It is not possible to invest directly in an index. Interest rates, exchange rates and market conditions are subject to change.

The Site may contain forward-looking statements about general economic factors which are not guarantees of future performance. Forward-looking statements involve inherent risk and uncertainties, so it is possible that predictions, forecasts, projections and other forward-looking statements will not be achieved. We caution you not to place undue reliance on these statements as a number of important factors could cause actual events or results to differ materially from those expressed or implied in any forward-looking statement. All opinions in forward-looking statements are subject to change without notice and are provided in good faith but without legal responsibility.

Certain names, words, titles, phrases, logos, icons, graphics or designs or other content in the pages of the Site are trade names or trade-marks owned by RBC or its subsidiaries, or trade names or trade-marks licensed to them. The trademarks are distinguished from one another and accompanied, at first-time use, with the appropriate trademark symbol: ®/TM. These symbols are keyed to their respective legend which describes the owner or licensee of the trade-mark. The display of trademarks and trade names on pages of the Site does not imply that a license of any kind has been granted to anyone else. The information is for your personal use only. Any unauthorized downloading, re-transmission, or other copying or modification of trademarks and/or the contents of the Site may be a violation of any federal or other law that may apply to trademarks and/or copyrights and could subject the copier to legal action. The information is protected under the copyright laws of Canada and other countries. Unless otherwise specified, no one has permission to copy, redistribute, reproduce, republish, store in any medium, re-transmit, modify or make public or commercial use of, in any form, the information.