LF Canlife Asia Pacific Fund Update

a tricky month

BY KIM LEE, SENIOR FUND MANAGER

March was a tricky month for global equity markets, as investors continued to prefer ‘safe haven’ assets such as government bonds. Pleasingly, Asian markets largely outperformed their developed market counterparts as the domestic growth story remained strong. We believe the higher volatility of late has been primarily driven by sentiment, with the fundamentally attractive backdrop being ignored.

For example, the recent Chinese National Party Congress (NPC) has anointed President Xi Jinping as ‘President for Life’. In the short-term this should be a positive for the market, as reforms such as the One Belt, One Road (OBOR) initiative continues. In addition, the domestic consumption story in China continues to be very strong, with growth in third tier cities and in the online space two areas we are particularly focused on.

However, risks do remain. We are closely monitoring China’s dialogue with the US, which has been more constructive in recent days. In addition, the medium to long-term impacts of President Xi’s appointment are still uncertain. Nonetheless, we believe Asian equities are well-placed to continue their strong performance in 2018 and beyond, particularly given the strength of the consumption growth story.

Important Information

Past performance is not a guide to future performance. The value of investments may fall as well as rise and investors may not get back the amount invested. Currency fluctuations can also affect performance. Due to the underlying assets held, the price of the Fund is classed as having above average to high volatility.

The information contained in this document is provided for use by investment professionals and is not for onward distribution to, or to be relied upon by, retail investors. No guarantee, warranty or representation (express or implied) is given as to the document’s accuracy or completeness. The views expressed in this document are those of the fund manager at the time of publication and should not be taken as advice, a forecast or a recommendation to buy or sell securities. These views are subject to change at any time without notice. This document is issued for information only by Canada Life Investments. This document does not constitute a direct offer to anyone, or a solicitation by anyone, to subscribe for shares or buy units in fund(s). Subscription for shares and buying units in the fund(s) must only be made on the basis of the latest Prospectus and the Key Investor Information Document (KIID) available at www.canadalifeinvestments.com.

Canada Life Investments is the brand for investment management activities undertaken by Canada Life Asset Management Limited, Canada Life Limited and Canada Life European Real Estate Limited. Canada Life Asset Management Limited (no. 03846821), Canada Life Limited (no.00973271) and Canada Life European Real Estate Limited (no. 03846823) are all registered in England and the registered office for all three entities is Canada Life Place, Potters Bar, Hertfordshire EN6 5BA. Canada Life Asset Management is authorised and regulated by the Financial Conduct Authority. Canada Life Limited is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority.

CLI01177 Expiry on 15 July 2018

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