MD Precision PortfoliosTM
April 4, 2025 Summary
After a detailed review of global economic and financial market conditions, MD Financial Management (MD) has made the following changes to the tactical asset allocation of the MD Precision Portfolios™ suite.
- We decreased our allocation to equities overall to a neutral position. Trade tensions have generated significant uncertainty to the economic and financial market outlook. The heightened risks to both economic growth and inflation in the U.S. from trade policy announcements could cascade more broadly into the rest of the global economy, that otherwise was expected to generate more balanced growth this year. Given these developments, returning portfolios to their strategic asset allocations is warranted.
- To return our Canadian equity position back to neutral, we decreased our allocation.
- To return our U.S. equity position back to neutral, we decreased our allocation.
- To return our international equity position back to neutral, we increased our allocation.
- We remain neutrally positioned in emerging market equities.
- To return our fixed income position back to neutral, we increased our allocation overall.
- We remain neutrally positioned in cash.
Portfolio changes
Bars that are above the 0% baseline indicate an overweight position versus the portfolios’ strategic asset allocation, while bars below the 0% baseline indicate an underweight position.
“Underweight” and “overweight” are relative terms, linked to the strategic asset allocation outlined in the simplified prospectus. An underweight position indicates a lower weighting and is generally an indication of the relative unattractiveness of an asset class. An overweight position indicates a higher weighting and is generally an indication of the relative attractiveness of an asset class.
MD Precision Conservative PortfolioTM (3+ years)
MD Precision Balanced Income PortfolioTM (4+ years)
MD Precision Moderate Balanced PortfolioTM (7.5+ years)
MD Precision Moderate Growth PortfolioTM (10+ years)
MD Precision Balanced Growth PortfolioTM (15+ years)
MD Precision Maximum Growth PortfolioTM (20+ years)
Note: The number of years (in parentheses) indicates the investment time horizon.
| Portfolio | Canadian equities | U.S. equities | International equities | Emerging markets equities | Short Canadian fixed income | Canadian universe fixed income | Cash |
|---|---|---|---|---|---|---|---|
| MD Precision Conservative Portfolio | Neutral | Neutral | Neutral | Neutral | Neutral | Neutral | Neutral |
| MD Precision Balanced Income Portfolio | Neutral | Neutral | Neutral | Neutral | Neutral | Neutral | Neutral |
| MD Precision Moderate Balanced Portfolio | Neutral | Neutral | Neutral | Neutral | Neutral | Neutral | Neutral |
| MD Precision Moderate Growth Portfolio | Neutral | Neutral | Neutral | Neutral | Neutral | Neutral | Neutral |
| MD Precision Balanced Growth Portfolio | Neutral | Neutral | Neutral | Neutral | Neutral | Neutral | Neutral |
| MD Precision Maximum Growth Portfolio | Neutral | Neutral | Neutral | Neutral | Neutral | Neutral | Neutral |
Why make tactical asset allocation decisions?
MD makes tactical asset allocation decisions to shift the positioning of your portfolio in response to trends in financial markets. These decisions are made as market conditions change. Through discussions with our research partners, we look for temporary, shortterm opportunities that may increase returns and/or reduce the risk of your portfolio. This is distinct from your portfolio’s strategic asset allocation, which maintains a longer-term view
Tactical versus Strategic asset allocation
MD Precision Portfolios allow investors to benefit from a combination of tactical and strategic asset allocation. With our tactical decisions, we look for temporary, shorter-term opportunities, based on an outlook of six to 18 months, which can potentially increase the return and/or reduce the risk of your portfolio.
Strategic asset allocation reflects the policy weights (asset mix) that have been set for your portfolio based on your investment needs and objectives
We overlay the tactical asset allocation decisions on the strategic asset allocations that support each of the portfolios. This means that we may temporarily deviate from the strategic allocations to take advantage of shortterm opportunities. Tactical decisions are made within a defined range and “risk budget” (the amount of risk allowed for each portfolio).
MD’s unique tactical asset allocation approach
Ongoing, comprehensive monitoring of global economic and financial market conditions drives our tactical asset allocation decisions. As conditions change, opportunities may present themselves. To identify these opportunities, MD uses in-depth economic research from industry-leading sources in combination with our proprietary investment management methodology.
MD’s process takes multiple variables into account, including the macroeconomic environment, financial market conditions, market risk indicators and fundamental trends.
MD’s tactical asset allocation process is designed to make the following decisions:
- Equities versus fixed income–Is the environment set to support equities or better suited for the stability of fixed income?
- Relative equity–Within equities, which geographical locations provide the most potential?
- Relative fixed income–Within fixed income, are short-term or longer-term bonds more attractive?
- Currencies––How will the foreign currencies of our foreign investments behave relative to the Canadian dollar? most potential?
Tactical asset allocation decisions are supported by rigorous analysis and are adapted to the unique needs of MD clients.
Invest with confidence
Put leading asset global managers and all-in-one convenience to work for you with MD Precision Portfolios. An MD Advisor can help you determine the ones best suited to your goals