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Your session has expired

You’ve been logged out due to inactivity

An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. Invalid login Your account has been temporarily locked because of too many failed login attempts. Please try again later. The code entered has expired. Please request a new code to continue. The code entered is not valid. Please request a new code to continue. Email address format is not valid. Your account has not been verified. Please check your email for instructions on how to verify your credentials. Your account has been disabled. An error occurred while processing your request. Please try again later. Invalid login This account has reached its limit for daily password resets. Please try again in 24 hours. Password does not meet password strength requirements. Please try again. That password was recently used. Please enter a new one. Password is not strong enough. Password cannot contain any forbidden words. Password is a commonly used password. Password cannot contain common words. Password cannot contain repeating characters. Password cannot contain sequence of characters. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. The account information you provided does not match our records. This account is not authorized to perform the request you've initiated. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. We are unable to log you out of all the application Password does not meet password strength requirements. Please try again. An error occurred while processing your request. Please try again later.

Session time out

Due to inactivity, you’ll be automatically logged out in

 

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Please enter the email address you used when registering.

Invalid login
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Email sent

If you have a valid account with us, you will receive an email with instructions to reset your password.

An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. Invalid login Your account has been temporarily locked because of too many failed login attempts. Please try again later. The code entered has expired. Please request a new code to continue. The code entered is not valid. Please request a new code to continue. Email address format is not valid. Your account has not been verified. Please check your email for instructions on how to verify your credentials. Your account has been disabled. An error occurred while processing your request. Please try again later. Invalid login This account has reached its limit for daily password resets. Please try again in 24 hours. Password does not meet password strength requirements. Please try again. That password was recently used. Please enter a new one. Password is not strong enough. Password cannot contain any forbidden words. Password is a commonly used password. Password cannot contain common words. Password cannot contain repeating characters. Password cannot contain sequence of characters. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. The account information you provided does not match our records. This account is not authorized to perform the request you've initiated. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. We are unable to log you out of all the application Password does not meet password strength requirements. Please try again. An error occurred while processing your request. Please try again later.

An error occurred while processing your request. Please try again later.

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Two-step verification

In order to change your password, we need to verify your identity. We will send an authorization code to the email address on file.

An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. Invalid login Your account has been temporarily locked because of too many failed login attempts. Please try again later. The code entered has expired. Please request a new code to continue. The code entered is not valid. Please request a new code to continue. Email address format is not valid. Your account has not been verified. Please check your email for instructions on how to verify your credentials. Your account has been disabled. An error occurred while processing your request. Please try again later. Invalid login This account has reached its limit for daily password resets. Please try again in 24 hours. Password does not meet password strength requirements. Please try again. That password was recently used. Please enter a new one. Password is not strong enough. Password cannot contain any forbidden words. Password is a commonly used password. Password cannot contain common words. Password cannot contain repeating characters. Password cannot contain sequence of characters. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. The account information you provided does not match our records. This account is not authorized to perform the request you've initiated. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. We are unable to log you out of all the application Password does not meet password strength requirements. Please try again. An error occurred while processing your request. Please try again later.

Two-step verification

Please enter the 6-digit code sent to your email. If you have not received a code, you may not have a registered account.

An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. Invalid login Your account has been temporarily locked because of too many failed login attempts. Please try again later. The code entered has expired. Please request a new code to continue. The code entered is not valid. Please request a new code to continue. Email address format is not valid. Your account has not been verified. Please check your email for instructions on how to verify your credentials. Your account has been disabled. An error occurred while processing your request. Please try again later. Invalid login This account has reached its limit for daily password resets. Please try again in 24 hours. Password does not meet password strength requirements. Please try again. That password was recently used. Please enter a new one. Password is not strong enough. Password cannot contain any forbidden words. Password is a commonly used password. Password cannot contain common words. Password cannot contain repeating characters. Password cannot contain sequence of characters. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. The account information you provided does not match our records. This account is not authorized to perform the request you've initiated. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. We are unable to log you out of all the application Password does not meet password strength requirements. Please try again. An error occurred while processing your request. Please try again later.

Please create a new password

An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. Invalid login Your account has been temporarily locked because of too many failed login attempts. Please try again later. The code entered has expired. Please request a new code to continue. The code entered is not valid. Please request a new code to continue. Email address format is not valid. Your account has not been verified. Please check your email for instructions on how to verify your credentials. Your account has been disabled. An error occurred while processing your request. Please try again later. Invalid login This account has reached its limit for daily password resets. Please try again in 24 hours. Password does not meet password strength requirements. Please try again. That password was recently used. Please enter a new one. Password is not strong enough. Password cannot contain any forbidden words. Password is a commonly used password. Password cannot contain common words. Password cannot contain repeating characters. Password cannot contain sequence of characters. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. The account information you provided does not match our records. This account is not authorized to perform the request you've initiated. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. We are unable to log you out of all the application Password does not meet password strength requirements. Please try again. An error occurred while processing your request. Please try again later.
  • Must be at least 9 characters long
  • Must have at least one capital letter
  • Must have a number
  • Must have a special character
  • Cannot contain any characters that repeat more than twice
  • New passwords fields must match

An error occurred while processing your request. Please try again later.

An error occurred while processing your request. Please try again later.

Password successfully reset.

Invalid login

Enter your password to login.

Invalid login
Invalid login
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Forgot password?

Two-step verification

In order to change your password, we need to verify your identity. We will send an authorization code to the email address on file.

An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. Invalid login Your account has been temporarily locked because of too many failed login attempts. Please try again later. The code entered has expired. Please request a new code to continue. The code entered is not valid. Please request a new code to continue. Email address format is not valid. Your account has not been verified. Please check your email for instructions on how to verify your credentials. Your account has been disabled. An error occurred while processing your request. Please try again later. Invalid login This account has reached its limit for daily password resets. Please try again in 24 hours. Password does not meet password strength requirements. Please try again. That password was recently used. Please enter a new one. Password is not strong enough. Password cannot contain any forbidden words. Password is a commonly used password. Password cannot contain common words. Password cannot contain repeating characters. Password cannot contain sequence of characters. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. The account information you provided does not match our records. This account is not authorized to perform the request you've initiated. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. We are unable to log you out of all the application Password does not meet password strength requirements. Please try again. An error occurred while processing your request. Please try again later.

Two-step verification

Enter the 6-digit code sent to your email

An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. Invalid login Your account has been temporarily locked because of too many failed login attempts. Please try again later. The code entered has expired. Please request a new code to continue. The code entered is not valid. Please request a new code to continue. Email address format is not valid. Your account has not been verified. Please check your email for instructions on how to verify your credentials. Your account has been disabled. An error occurred while processing your request. Please try again later. Invalid login This account has reached its limit for daily password resets. Please try again in 24 hours. Password does not meet password strength requirements. Please try again. That password was recently used. Please enter a new one. Password is not strong enough. Password cannot contain any forbidden words. Password is a commonly used password. Password cannot contain common words. Password cannot contain repeating characters. Password cannot contain sequence of characters. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. The account information you provided does not match our records. This account is not authorized to perform the request you've initiated. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. We are unable to log you out of all the application Password does not meet password strength requirements. Please try again. An error occurred while processing your request. Please try again later.

Please create a new password

An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. Invalid login Your account has been temporarily locked because of too many failed login attempts. Please try again later. The code entered has expired. Please request a new code to continue. The code entered is not valid. Please request a new code to continue. Email address format is not valid. Your account has not been verified. Please check your email for instructions on how to verify your credentials. Your account has been disabled. An error occurred while processing your request. Please try again later. Invalid login This account has reached its limit for daily password resets. Please try again in 24 hours. Password does not meet password strength requirements. Please try again. That password was recently used. Please enter a new one. Password is not strong enough. Password cannot contain any forbidden words. Password is a commonly used password. Password cannot contain common words. Password cannot contain repeating characters. Password cannot contain sequence of characters. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. The account information you provided does not match our records. This account is not authorized to perform the request you've initiated. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. We are unable to log you out of all the application Password does not meet password strength requirements. Please try again. An error occurred while processing your request. Please try again later.
  • Must be at least 9 characters long
  • Must have at least one capital letter
  • Must have a number
  • Must have a special character
  • Cannot contain any characters that repeat more than twice
  • New passwords fields must match

An error occurred while processing your request. Please try again later.

An error occurred while processing your request. Please try again later.

Password successfully reset.

Two-step verification

In order to change your password, we need to verify your identity. We will send an authorization code to the email address on file.

An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. Invalid login Your account has been temporarily locked because of too many failed login attempts. Please try again later. The code entered has expired. Please request a new code to continue. The code entered is not valid. Please request a new code to continue. Email address format is not valid. Your account has not been verified. Please check your email for instructions on how to verify your credentials. Your account has been disabled. An error occurred while processing your request. Please try again later. Invalid login This account has reached its limit for daily password resets. Please try again in 24 hours. Password does not meet password strength requirements. Please try again. That password was recently used. Please enter a new one. Password is not strong enough. Password cannot contain any forbidden words. Password is a commonly used password. Password cannot contain common words. Password cannot contain repeating characters. Password cannot contain sequence of characters. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. The account information you provided does not match our records. This account is not authorized to perform the request you've initiated. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. We are unable to log you out of all the application Password does not meet password strength requirements. Please try again. An error occurred while processing your request. Please try again later.

Please enter you new phone number

Invalid number
Invalid country code
Number is too short
Number is too long
Invalid number
Invalid number
An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. Invalid login Your account has been temporarily locked because of too many failed login attempts. Please try again later. The code entered has expired. Please request a new code to continue. The code entered is not valid. Please request a new code to continue. Email address format is not valid. Your account has not been verified. Please check your email for instructions on how to verify your credentials. Your account has been disabled. An error occurred while processing your request. Please try again later. Invalid login This account has reached its limit for daily password resets. Please try again in 24 hours. Password does not meet password strength requirements. Please try again. That password was recently used. Please enter a new one. Password is not strong enough. Password cannot contain any forbidden words. Password is a commonly used password. Password cannot contain common words. Password cannot contain repeating characters. Password cannot contain sequence of characters. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. The account information you provided does not match our records. This account is not authorized to perform the request you've initiated. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. We are unable to log you out of all the application Password does not meet password strength requirements. Please try again. An error occurred while processing your request. Please try again later. An error occurred while registering your account. Please try again.

Your account phone number has been changed successfully

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An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. Invalid login Your account has been temporarily locked because of too many failed login attempts. Please try again later. The code entered has expired. Please request a new code to continue. The code entered is not valid. Please request a new code to continue. Email address format is not valid. Your account has not been verified. Please check your email for instructions on how to verify your credentials. Your account has been disabled. An error occurred while processing your request. Please try again later. Invalid login This account has reached its limit for daily password resets. Please try again in 24 hours. Password does not meet password strength requirements. Please try again. That password was recently used. Please enter a new one. Password is not strong enough. Password cannot contain any forbidden words. Password is a commonly used password. Password cannot contain common words. Password cannot contain repeating characters. Password cannot contain sequence of characters. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. The account information you provided does not match our records. This account is not authorized to perform the request you've initiated. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. We are unable to log you out of all the application Password does not meet password strength requirements. Please try again. An error occurred while processing your request. Please try again later.

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Invalid login
An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. Invalid login Your account has been temporarily locked because of too many failed login attempts. Please try again later. The code entered has expired. Please request a new code to continue. The code entered is not valid. Please request a new code to continue. Email address format is not valid. Your account has not been verified. Please check your email for instructions on how to verify your credentials. Your account has been disabled. An error occurred while processing your request. Please try again later. Invalid login This account has reached its limit for daily password resets. Please try again in 24 hours. Password does not meet password strength requirements. Please try again. That password was recently used. Please enter a new one. Password is not strong enough. Password cannot contain any forbidden words. Password is a commonly used password. Password cannot contain common words. Password cannot contain repeating characters. Password cannot contain sequence of characters. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. The account information you provided does not match our records. This account is not authorized to perform the request you've initiated. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. We are unable to log you out of all the application Password does not meet password strength requirements. Please try again. An error occurred while processing your request. Please try again later. An error occurred while validating your email address. Please try again.

Email sent

If you have a valid account with us, you will receive an email with instructions to reset your password.

An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. Invalid login Your account has been temporarily locked because of too many failed login attempts. Please try again later. The code entered has expired. Please request a new code to continue. The code entered is not valid. Please request a new code to continue. Email address format is not valid. Your account has not been verified. Please check your email for instructions on how to verify your credentials. Your account has been disabled. An error occurred while processing your request. Please try again later. Invalid login This account has reached its limit for daily password resets. Please try again in 24 hours. Password does not meet password strength requirements. Please try again. That password was recently used. Please enter a new one. Password is not strong enough. Password cannot contain any forbidden words. Password is a commonly used password. Password cannot contain common words. Password cannot contain repeating characters. Password cannot contain sequence of characters. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. The account information you provided does not match our records. This account is not authorized to perform the request you've initiated. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. We are unable to log you out of all the application Password does not meet password strength requirements. Please try again. An error occurred while processing your request. Please try again later.

An error occurred while processing your request. Please try again later.

An error occurred while processing your request. Please try again later.

Two-step verification

In order to change your password, we need to verify your identity. We will send an authorization code to the email address on file.

An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. Invalid login Your account has been temporarily locked because of too many failed login attempts. Please try again later. The code entered has expired. Please request a new code to continue. The code entered is not valid. Please request a new code to continue. Email address format is not valid. Your account has not been verified. Please check your email for instructions on how to verify your credentials. Your account has been disabled. An error occurred while processing your request. Please try again later. Invalid login This account has reached its limit for daily password resets. Please try again in 24 hours. Password does not meet password strength requirements. Please try again. That password was recently used. Please enter a new one. Password is not strong enough. Password cannot contain any forbidden words. Password is a commonly used password. Password cannot contain common words. Password cannot contain repeating characters. Password cannot contain sequence of characters. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. The account information you provided does not match our records. This account is not authorized to perform the request you've initiated. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. An error occurred while processing your request. Please try again later. We are unable to log you out of all the application Password does not meet password strength requirements. Please try again. An error occurred while processing your request. Please try again later.

Two-step verification

Please enter the 6-digit code sent to your email. If you have not received a code, you may not have a registered account.

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Episode 95: Investing, happily, ever after—is your portfolio set for a fairytale ending? (part 2)


In part two of our happily, ever after series of Investments Unplugged, we continue to compare timeless tales to the current markets. In this conversation, we provide our updated outlook on bonds and discuss global central banks as they start their easing cycles.

Tune into our new episode to learn more.  

This communication is not and under no circumstances is to be construed as an invitation to make an investment in the Manulife Real Asset Investment Fund (the “Fund”), nor does it constitute a public offering to sell the securities of the Fund. The offering of units of the Fund is made pursuant to its Confidential Offering Memorandum only to those “accredited investors” in certain jurisdictions of Canada who meet certain eligibility and cannot be sold in Canada to the general public. The offering memorandum contains important information regarding the fund’s investment objectives, strategies, restrictions, risks, fees, redemption limitations, liquidity and other matters of interest. There are no assurances that the stated investment objectives of the fund will be met. Applications for investment in the Fund will only be considered on the terms set out in the Confidential Offering Memorandum, a copy of which can be obtained from us. Eligible investors should review the Confidential Offering Memorandum carefully before deciding to purchase units and should note that alternative investments can involve significant risks. The Fund is not guaranteed, its values may change frequently and past performance may not be repeated.

The opinions expressed are those of Manulife Investment Management as of the date of this publication, and are subject to change based on market and other conditions. The information and/or analysis contained in this material have been compiled or arrived at from sources believed to be reliable but Manulife Investment Management does not make any representation as to their accuracy, correctness, usefulness or completeness and does not accept liability for any loss arising from the use hereof or the information and/or analysis contained herein. Manulife Investment Management disclaims any responsibility to update such information. Neither Manulife Investment Management or its affiliates, nor any of their directors, officers or employees shall assume any liability or responsibility for any direct or indirect loss or damage or any other consequence of any person acting or not acting in reliance on the information contained herein.

All overviews and commentary are intended to be general in nature and for current interest. While helpful, these overviews are no substitute for professional tax, investment or legal advice. Clients should seek professional advice for their particular situation. Neither Manulife, Manulife Investment Management Limited, Manulife Investment Management, nor any of their affiliates or representatives is providing tax, investment or legal advice. Past performance does not guarantee future results. This material was prepared solely for informational purposes, does not constitute an offer or an invitation by or on behalf of Manulife Investment Management to any person to buy or sell any security and is no indication of trading intent in any fund or account managed by Manulife Investment Management. No investment strategy or risk management technique can guarantee returns or eliminate risk in any market environment. Unless otherwise specified, all data is sourced from Manulife Investment Management.

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Kevin Headland:

Commentary is for general information purposes only. Clients should seek professional advice for their particular situation.

Macan Nia:

Basically, what is it? Michael Scott, he's the boss. He comes out of his office and there's all this commotion and he's yelling. "It's happening. It's happening." And that's what it felt like this morning. It's happening. The Bank of Canada cut rates.

On this episode of Investments Unplugged, we continue our discussion focus on our happily-ever-after thought leadership where we draw comparisons between classic children fables and investing. In the first part, we discussed the similarities between the fable Goldilocks And The three Bears and the current global macro backdrop, while also comparing the teachings from the Ants And The Grasshopper and our equity outlook.

In this episode, we compare the lessons from the Three Little Pigs and outlook for bonds moving forward. And finally we focus on global central banks as they start their easing cycles and whether we can draw similarities to the fable, The Goose That Laid The Golden Egg. Ultimately, fairy tales are just stories, but it's the meaning behind these stories that matter. The lessons contained within these stories can be applied in many ways and aren't just for children. We believe that these lessons can be applied in investments as well. Hopefully, these fairy tales can help pave the way to investing happily-ever-after. Listen on. This is Investments Unplugged.

Welcome back to the second part of this Investments Unplugged named Happily-ever-after. My name is Macan Nia, co-chief investment strategist. I guess I should introduce myself and joined here...

Kevin Headland:

You need no introduction, come on.

Macan Nia:

And joined here with my partner in crime, Kevin Headland.

Kevin Headland:

It's a great start.

Macan Nia:

It's fantastic.

Kevin Headland:

It's been one of those days, one of those days.

Macan Nia:

It seriously has been one of those days. So Kev, let's continue the discussion. And for those that are maybe listening to this episode and didn't have the opportunity to listen to the last one, in a nutshell, what we've done is we've attached children fables and the lessons from those to investing principles today. So in the first part we chatted about the global economic environment. We also talked to the dynamic for equities. We attached fables for that. And then the fables were... Oh my gosh, it's gone. Drawing a blank, for the macro one.

Kevin Headland:

Goldilocks And The Three Bears.

Macan Nia:

Goldilocks And The Three Bears.

Kevin Headland:

Goldilocks economy.

Macan Nia:

All I had in my head was porridge for some reason. And then for the second one it was, essentially, The Ant And The Grasshopper. Now what we're going to do for the second part is talk about bonds. The fable that we're going to attach to this one is The Three Little Pigs and Kev you'll talk to that in just a bit. And then the last part will be the fed and I will draw comparisons to The Goose That Laid The Golden Egg. So let's get started, Kev. Let's talk about the bond backdrop. As the time of recording, this is June 5th, and to the delightment of myself as a variable rate mortgage owner, the Bank of Canada finally started cutting interest rates. This morning, they cut interest rates from five to four and three quarters, and we could talk to that in a bit, but this goes to the backdrop, Kev, of the theme when it comes to bonds. We have been waiting, it seems forever, at least the past year, for these cuts to materialize, and you and I were joking this morning.

It reminds me of that one episode in The Office. And for those that followed The Office or a lot of you know which one I'm talking about. Basically, what is it, Michael Scott, he's the boss, he comes out of his office and there's all this commotion. And he's yelling, "It's happening. It's happening." And it's a fire. But everyone's hustling and bustling. They've been waiting for this because I think they had fire procedures in place. And he's just like, "Everyone out, it's happening." And that's what it felt like this morning, Kev. It's happening. The Bank of Canada cut rates. What we've all been forecasting for the better much of the past year of these cuts likely to happen has big begun. So I think that's a good prelude into the bond conversation.

Kevin Headland:

Yeah, for sure. And it's funny you say you're so happy a quarter point, it's going to be a little barely a blip in your overall mortgage, but at least it's not raising rates. At least, we're starting to cut rates. There's a little bit of a light at the end of the tunnel maybe. In fact it was almost a full year, so last time they stopped raising rates was a year ago in July. So almost full year between last rate hike and the first rate cut. But in terms of the overall fixing of landscape, bonds, we've been talking about bonds, the opportunity bonds, since beginning of 2023. It was a terrible 2022 and it took time before that theory started to play out. Roughly 10 months. It wasn't until the last two months of the year of 2023 when really the bond opportunity really started to materialize in terms of performance. And in terms of a fairy tale, it made me think of The Three Little Pigs.

And of course, The Three Little Pigs are three little brothers that are pigs. They're trying to build houses to protect themselves against the big bad wolf who's trying to blow them over and eat them. Of course, we talked about how fairy tales are actually very dark when you actually pull back the layers and realize that like, "Oh, these aren't very children like stories, are they?" But anyway, the first pig constructs his house out of straw. Really quick and easy. Of course, it blows down very easily. The second pig builds their house out of sticks or wood. A little bit better, but still does get blown over. And the final pig takes his time and does it properly and builds out of brick. And I think it really is, or begs the question, how strong is your fixed income house? And I think it's key right now is to make sure the fixing portion of your portfolio stands the test of time and build it right.

Now, build it also with flexibility. The key here is we want to be flexible because we talked about the three phases of fixed income. The first phase being the clip the coupon phase, take advantage of the yield opportunity that exists. Still very positive. Still there. The second phase is duration is your friend. As the economy starts to weaken, as central banks start to cut rates, the long end of the yield curve tends to fall and that's when the duration math is really in your favor. Third phase is take on risk. When the maximum capitulation, when the economy is likely recession or gain towards recession, end of the cycle, high spreads to the widen, which means the price falls and you want to take advantage of that attractive valuation and the riskier aspects in the market. Same with equities. We were saying we were transitioning between phase one and phase two.

It seems however, this time not saying it's different, it's just been not as linear. The phase one to phase two step. There's still a lot of opportunity that exists in phase one. There's even some opportunity that exists in phase three where there is some high yield bonds that remain attractive. But we want to do our due diligence, research the proper credit, understand the opportunities there and not take undue risk there. That flexibility of really moving around is key right now as there's abundance of opportunity and fixed income. We just want to make sure we're building our house out of brick instead of stone. We talked about the Bank of Canada cutting rates. The ECB is likely going to cut rates tomorrow, June 6th, for the first time. So really in the developed world, we're almost now getting the Fed as being the lone holdout from cuts. Of course, Bank of England still doesn't cut rates, but they're likely close to it. So it seems that the Fed might be the only one left to cut rates.

Macan Nia:

Yeah, I think Kev, when we look at that diagram two, it's disingenuous. For those that have seen it, it's basically an arrow, the three different phases, and there's one dot that's between phase one and phase two. And I think that's a little bit, I think we need to update that Kev in the sense that it's disingenuous. That's assuming that growth across the world is all synchronized. And we know that's not the case, as you mentioned. We know the Bank of Canada already has start cutting rates. Like you said, the ECB is probably going to cut rates at their next meeting. And if I was to update that one, I think the dot where it is between phase one and phase two, that's the US. Whereas if there was a Canadian dot, if there was a European dot, those would be actually more closer to phase two where you want to be adding more to duration and maybe you would want to in the US. But across the world, we're clearly approaching phase two with some economies already in phase two.

And that will have implications for central bank policy. That will have implications for CAD USC. That will have implications, most importantly, maybe not most importantly, but in the context of this discussion is bonds. And we've all been waiting for this bond thesis to play out. The backdrop for many of us made sense, but it wasn't materializing in cuts. And now that patience, it seems, is finally being rewarded. Now the next question was, it will be is because we're never happy as investors. Okay, we got one in Canada, when's the next one and how many more by the end of the year? And I think that's where investors should temper their expectations. This is unlikely to be a typical interest rate easing cycle. I think there's going to be a lot of wait and see, data dependency. They want to make sure that inflation does not reaccelerate. As we always tell investors, temper your expectations.

Kevin Headland:

Well, going back to that, the expectations. I think Tiff Macklem today in the press conference had the best line. He said, "Let's just enjoy this for a moment." And I chuckled myself when he said it. It was so funny, off the cuff when people were asking, "When's the next one? What's your plan for July? What's going on September?" And he was just, "Okay, calm down. Let's just enjoy this first cut and we'll see what happens later on." As you said, there's a lot of information still to come. GDP data, unemployment data, inflation data. We don't want to put the cart before the horse, shall we say. The other thing that is really interesting, as you said also, is the notion of the differences in the global economies on a relative basis. We're now over 25% of the world's central banks with GDP perspective that have already started cut rates.

So that's important. Already we're seeing rate cuts. So even some of the dynamics of duration, we're already working in other areas of the world. And again, that points back to one of the keywords I said earlier is flexibility. I think really when we're building portfolios in this current environment, flexibility, especially in fixed income, is key. And I think we want to be able to have the biggest sandbox to play in, making sure we can really pull those levers to try and maximize their return and maximize our income. Still obviously cognizant of risks. Still trying to manage any downside volatility offset to equities. But really the idea of fixed income is still a good piece of portfolio. It's still a solid base of a portfolio. Still a foundation built out a brick. And I think it's important to realize that 2022 was an aberration. Fixed income is not dead. The 64th portfolio is not dead. Perhaps it's morphing, it's changing, but there's still a place for these type of assets in a portfolio and it's important we don't forget about that.

Macan Nia:

Yeah, it's funny you say that. There's been a bunch of stuff going around on the internet since the decision today. And I thought the funniest one, for me anyways, was it's basically a picture of a concert and Tiff Macklem's head's been superimposed on whoever's signing the autograph. And the guy signing an autograph, in this example, I think it's a baby. There's people getting their typical rock star behavior of signing things. But Tiff Macklem's head is superimposed on this body and all the image says is, Tiff greeting over leveraged condo investors after his announcement. And I thought that was really funny. But I think we should also temper expectations of how this is going to impact the Canadian housing market, how this is going to impact CAD USD. This is just one cut. This is not going to reaccelerate the Canadian housing market. It is not going to reintroduce new buyers into the market.

So for those that are expecting this to have material or any impact, probably less likely. Now if we're at the end of the year and we're four cuts in, then let's have a conversation. But right now, let's temper our expectations in terms of the impact on this. And you've noticed the impact in CAD USD today. This was very well telegraphed, very well orchestrated, where CAD USD from a daily price movement perspective is actually below what it has been historically over the past couple of years. So very well telegraphed. That's why I think, Kev, those investors wanted to know what's next. Many people didn't think we'd get a June-July cut. Now we're getting exciting. So it's data dependent. We'll be paying close attention. And I'll pass it, Kev, maybe back to you for one final thought when it comes to bonds.

Kevin Headland:

Yeah, just maybe think of the internet and some the memes and I'm expecting to see the one, have you seen the one where it looks like a bunch of people at a bar and they're looking at a big screen TV and something happens and they all cheer like crazy? I could totally see that, one of the memes that I going to see on the internet soon with the announcement coming up and everyone's cheering.

Macan Nia:

Well, our group, we have a group, it's me, yourself, Francis, Erica, Dom. We have a big group. Hugo,

Kevin Headland:

Hugo. Hugo.

Macan Nia:

Alex Grecedo, and I'm just naming off everyone. But we were having a talk like, "Oh my goodness, Bank of Canada decision in 15 minutes." And I can tell the ones with variable rate mortgages were much more into it. And then when it came out, everyone's like, "Yes." High-fives.

Kevin Headland:

I think it's just nice to, we're finally getting off. We went through the rate hikes and those were delayed. Then we finally get rate hikes and we're excited then because we need that to calm our inflation. Then the rate hikes are longer and higher than many expected on both sides of the border. And then finally we got on the sidelines and it was a pause and okay, when are we getting to a level where we just start cutting rates? And again, we're finally there. So it is a bit of a sigh of relief, shall we say. But the key is temper expectation, as you said. I think that's really important. But still the pathway for the bond opportunity looks even better now as we start to see a light at the end of the tunnel, for the move lower in yields, which means higher in price for many fixing instruments.

Macan Nia:

Good place to transition, Kev. And last but not least is the Fed. And this has changed dramatically over past six months. So going into October of last year, markets we're expecting two cuts from the Fed. Overnight, the Powell pivot happened, six cuts were priced in. And then as we were going into really the past, really the first quarters of this year, that has been taken out again. Where I think today it's one, maybe two cuts. And we were talking about the federal and why were we paying attention to this? And the way we looked at it is the fable that we attached to this was The Goose That Laid The Golden Egg. So let's talk. This one is actually the darkest of all the fables. I hope you didn't read this to your child. In the future, if Owen becomes a serial killer, we can all pinpoint at what points to his mentality changed. Or maybe it's just being with you, Kev.

But anyways, I digress. But joking aside, so The Goose That Laid The Golden Egg is, it's a classic fable. It tells a story of a poor farmer. He discovers that one of his geese lays eggs and these eggs are made out of solid gold. He's overjoyed initially. But like humans, like all of us, the farmer becomes greedy and he wants more gold immediately. So he decides to kill the goose to access the golden eggs at once and only to find, Kev, that there are no golden eggs inside. And he has killed the golden goose. So the moral of the story here is they warn against basically greed, the dangers of always wanting immediate gratification at the expense of long-term sustainability. And the similarities we thought that were in this case is between the fable and the investors, the investors focus on the Fed. And why is that?

Because of greed. And so what we did very quickly, Kev, is we went back to 1970, we calculated the one- and two-year forward returns of various asset classes after the first rate cut in each cycle. I believe there was nine cycles we looked at. And the data suggests that, we wrote a piece on this, so if you want to actually go more into the details, see the charts, it's on our website. But ultimately, the reason that we want the Fed to start cutting rates is one-year and two-year forward returns historically are possible. What you also notice is that those riskier asset or risk-on asset classes like gross 2000 US high yield, they typically get a lot more of their gain in that second year. So if the Fed starts cutting this year, which we think is the base case, historically, that one year forward performance is driven by quality. And then the baton is passed from quality, in the first year, to more growth riskier in the second.

Kevin Headland:

Yeah, I think there is really, to me it's about the Fed put. The idea of as soon as the Fed starts to cut rates, markets move higher. And that was the idea. And the market was really pricing that in, especially after they stopped raising rates, there were that euphoria. Finally, they're not raising rates anymore, but then they were starting price those cuts in. And as soon as you said they started cutting those six rate cuts or priced the six rate cuts in, again the market took off and rallied quite strongly.

And it was really about that greed and saying, be careful and be cautious and maybe patient. Allow the returns to play over time because we've been up perhaps the valuation of the market too quickly, it might not last as long. And again, that's the greed that we might be seeing. So I think that's a key here is where we want to still be very constructive on the equity market, especially the SP 500. But also don't be greedy, identify and find the right companies we're looking for, the quality businesses, and allow those golden eggs to be laid out over time because that is the best way to achieve our goals at the end versus just trying to get all the gold at once. And again, greed very rarely pays off over longer term.

Macan Nia:

And Kev, nothing is easy in investing. So it's not as simple as just that. One-year and two-year returns are great after the fact. Ultimately, when the Fed gets the cut rates, me and you will sit there and we'll say, "Okay, why are they cutting rates? What is the backdrop that they're cutting rates?" The reason I'm bringing this up is when you look at the previous nine easing cycles and you basic contrast various asset class returns, of the nine times, seven of them are possible. However, there are two periods where they're easing and those two-year forward returns are still negative. And those are the great financial crisis and .com. What is the difference between these two periods and the other seven? And what we came up with, essentially, was those seven of the nine where asset class returns were positive two years later after they began easing is the backdrop, Kev, is a typical economic slowdown. In a typical business.

The two that weren't, .com and great financial crisis, there's systematic risks, esoteric risks in the system. Financial crisis, we know what it was, .com. It was excessive valuations. You had a recession and you also had 911. As of right now, we think when they begin cutting rates, it's going to be on a backdrop of a typical economic slowdown. And to many of us, that's a new thing, myself included. If I started practicing in the field 15 plus years ago. Look at the easing cycles I've witnessed. So great financial crisis. COVID, not typical. Even the one before that, .com, which I was much younger, I think grade five, six, but I was still following markets, not to the degree like I am now.

Kevin Headland:

Were you really?

Macan Nia:

Yeah, those were the Nortal stock days, man, back in the day.

Kevin Headland:

Grade five, grade six.

Macan Nia:

Maybe grade five, maybe grade five I'm exaggerating. But grade seven, yeah, for sure. Yeah, I made a lot of mistakes back then by, I guess, equivalents of marijuana stocks.

Kevin Headland:

I started working. I started working in '99.

Macan Nia:

Wow. How are you that much?

Kevin Headland:

I worked during the tech grade.

Macan Nia:

You're not that much older anyways. But we haven't seen a traditional business cycle. And it seems, as of right now, that this, when they begin easing, it's going to be on that backdrop. Now let's say they start easing and something from the back page has come to the front page, commercial real estate, whatever it may be, then you may reassess or we may reassess. But as of right now, we believe it's going to be a difficult business cycle. Slow down and easing as a result will be positive for asset class returns easing.

Kevin Headland:

I think that's key right now is that's the idea. I think it's obvious about our overall messaging from the last or the previous podcast and this one and our framework from a fairy tales is this notion of patience, quality, flexibility. We're still very positive, but we want to take everything with a grain of salt. And I think it's important for us. It's all a measured approach, but there's no reason to be fearful in this environment, we don't think. We don't see many signs of it just yet. And if we start to see signs of material risk, definitely we will look into that, research it, and likely comment on it. But as it stands now, we remain still very positive and look at a balanced approach to fixing them our overall portfolio construction.

Macan Nia:

Absolutely. So I think that's a good place to pause. So I think when you look back in terms of these fables, it's taking lessons that children are taught and reintroducing those lessons to investors because I think, as investors, all of us are guilty of it. We lose sight of the big picture. We get caught up in the short-term noise. And I have found this with the bond, Kev, bonds and GICs. In the short-term noise the past couple of years, yeah, GICs have made sense. But are they going to make sense when we look back in five years, in five years time to see, okay, bonds have performed or GICs have performed. And I think it's important to reintroduce these very simple concepts, but important concepts when it comes to investing. So with that, do you know lasting thoughts? You're looking at me with a blank stare. I thought you had one more thing to say. Okay, so we're good to go?

Kevin Headland:

Nope. All good.

Macan Nia:

Again, we want to thank everyone for loose listening in. We're always very, very surprised by the listenership or the subscribership to the podcast. We appreciate it. Sometimes we feel we're recording this and it goes into a black hole. But we always appreciate when anyone comes up to us on the road and saying that they listen to this, it means a lot to us. Shows that our efforts are going noticed. So again, if you like it, recommend it to other like-minded financial podcasters. If you like it, give it a rating. It typically increases the table or the standings. So we just want to thank you again. So with that, I'm going to sign off. My name is Macan Nia.

Kevin Headland:

And Kevin Headland.

Macan Nia:

Thank you for joining us.

Kevin Headland:

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Kevin Headland, CIM

Kevin Headland, CIM, 

Co-Chief Investment Strategist

Manulife Investment Management

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Macan Nia, CFA

Macan Nia, CFA, 

Co-Chief Investment Strategist

Manulife Investment Management

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