Invest in Canada

Investing in Canada isn’t just the right thing to do; it makes good financial sense.

Overview Opportunities Research Paper Long Term Returns

Overview

The country is known for its favourable demographics, a tolerant, well-educated, and diverse population, an expanding economy with moderate debt levels, abundant natural resources, modern infrastructure, and a democratic political system. It is also recognized for its strong legal system, as well as its world-renowned educational institutions. We are optimistic about Canada’s prospects.

Canada Is Rich With Opportunity

The Canary in the Coal Mine

In 1990, Canadian pension funds allocated close to 80%* of their equity investments to Canadian public equities. By 2020, this had fallen to barely 10%*. This decline has important policy implications for Canada.

Who will determine Canada’s future if Canadian savings do not play their essential economic role in funding Canadian investments?

What will be the impact on growth, jobs, and incomes?

This is only one of several issues that have risen in importance as a result of the shortening of the investment horizon that has been imposed on pension funds by changes to regulations.

Research Paper (PDF)

Presentation (PDF)

Long Term Returns

Canadian equities have generated strong long term returns

Since 1988, LetkoBrosseau’s investments in Canadian equities have generated $19 billion in net gains ^[1] across all client portfolios, equivalent to a 14.4% compounded annualized return. This is about 80% more than the 8.3% annualized return delivered by international markets^[2] over the same period.

There are self-sustaining benefits to investing in our own industries

The Pension Investment Association of Canada reported that in 2000, the proportion of Canadian equities in overall asset allocation of pension plans in Canada was 28%; in 2020, it was approximately 5%.

We should be laser-focused on building the next made-in-Canada global success story. If Canadian pension funds and institutional investors don’t invest in our own country to support the development of these businesses, who will?

Canadian Equity Carve-out^[4][5]

Compounded Annualized Returns as at December 31, 2023

	1 yr	3 yrs	5 yrs	10 yrs	since inception
Gross Return	7.89%	14.42%	10.70%	8.34%	14.21%
Benchmark Return	11.63%	9.53%	11.29%	7.58%	8.39%

Value of $1 million invested in the Canadian Equity Composite since 1995^[3][5]

* Pension Investment Association of Canada. (s.d.) Pension investment association of Canada. PIAC 2022. https://piacweb.org/.

[1] Represents the net gains on Canadian equities for all mandates under management from January 1, 1988 to December 31, 2023.

[2] MSCI World Total Return Net Index

[3] The value graph represents the excess return of the Letko Brosseau Canadian Equity Composite over the benchmark gross of fees from October 1, 1995 to December 31, 2023.
The benchmark since inception is 2% FTSE Canada 91 Day T-Bill Total Return Index and 98% S&P/TSX Composite Total Return Capped Index.

[4] The returns are gross of fees and are derived from a carve-out of total firm assets made up of Canadian Equities for the period from January 1, 1988 to December 31, 2023. The benchmark is the S&P/TSX Composite Total Return Capped Index.

[5] Returns reflect the reinvestment of dividends, income and other earnings. Reclaimable withholding tax refunds are recognized when received. The benchmark is fully invested, and its returns include the reinvestment of dividends, income and other earnings.
Gross-of-fees returns are presented before management fees and custodial fees but after trading expenses.
This information is for informational purposes only and is not intended to provide, and should not be relied upon for, accounting, legal or tax advice or investment recommendations. It should not be considered a solicitation to buy or an offer to sell a security. It does not consider any investor’s particular investment objectives, strategies, tax status or investment horizon. There is no representation or warranty as to the current accuracy of, nor liability for, decisions based on such information.
Past performance is not a guarantee of future returns. All investments pose the risk of loss and there is no guarantee that any of the benefits expressed herein will be achieved or realized.
The returns do not represent those of a Canadian Equity mandate but do provide an indication of our ability to select and manage securities in this segment. The choice of securities and their returns could have been different when managing a Canadian Equity mandate.