Month in Review - September 2021
The month of September is historically a volatile one for global stock markets, and this September was no different, as the TSX Composite fell 2.8% and the S&P500 (in CAD) fell 4.3%. The Canadian Bond Universe fell 1.7%, further increasing losses on traditional balanced portfolios, highlighting the current risk of bonds. Traditionally, bonds have hedged losses when stocks fall, providing a diversified portfolio. However, with rates so low, bonds are now more correlated to stocks, which is why Harbourfront has introduced private debt and private real estate as an alternative to bonds. These two asset classes continue to remain uncorrelated to stocks, resulting in a more diversified portfolio than those with bonds.