Your 2024 investment replay

“So, how have your investments been doing?”

If you’d be stumped by this question at a holiday party, you’ve come to the right place.

Welcome to the first in a quarterly series of updates about the markets in general, and the performance of Tangerine’s Investment Portfolios in particular.

Let’s get into it.

A year of ups and downs (but mostly ups)

The past year sometimes felt like a nailbiter, with the cost of living still high for many Canadians, and major world events causing a lot of uncertainty.

But the bottom line for many investors? It’s been a good year.

Talking points: The U.S. kicked off 2024 on a high note with tech stocks (hey, Nvidia!) leading the charge¹. Later in the year, when the Bank of Canada started cutting interest rates, certain rate-sensitive sectors in Canada (like banks and mining companies) got a nice lift.

In fact, November was the best month of the year (so far) for both the S&P/TSX Composite index in Canada and the S&P 500 index in the U.S., reaching new record highs.

What it means for your investments: Good news! Tangerine’s Investment Portfolios have been riding that market wave. 🏄‍♂️

Performance from Jan. 1 to Nov. 30, 2024. Source: 1832 Asset Management L.P. Past returns are not indicative of future performance.

As you can see in the chart above, all of our Portfolios posted positive returns, ranging from 9.70% to 31.58%. Our three Equity Growth Portfolios and our Dividend Portfolio, with 100% investment in stocks, saw the highest returns among our Investment Funds in 2024.

Click to see our full historical performance

💡Why don’t I just move all my money into these Portfolios?

• Portfolios concentrated in stocks, rather than those more balanced between stocks and bonds, are considered medium to high risk, meaning they tend to see greater swings in performance (volatility) over time.
• Strong performance this year doesn’t guarantee strong performance in future years. It’s important to understand your goals, when you’ll need the money, and your ability to stomach potential losses.
• If you want to reassess your financial goals and risk tolerance, give us a call at 1-877-464-5678.
• However, apart from the Money Market Fund, all of our Portfolios have at least some stock market exposure, so they all benefited from the good tidings of 2024.

The year at a glance

Want to put 2024 in perspective? Here are a few numbers to keep in mind.

A deeper dive: 2024’s greatest hits

A few talking points to impress your friends this season while passing the cheese platter.

1. Inflation and interest rates drop

The backstory: Rising inflation over the last few years hurt many of us, bringing up the price of everything from gas to groceries to travel to luxury items. Central banks around the world then raised interest rates to bring these price hikes under control.

Higher interest rates made borrowing money more expensive, which dampened corporate spending and investing in general.

What happened this year: As inflation has come under control, interest rates have been ticking down this year, with the Bank of Canada lowering its policy interest rate five times between June and December.

What’s next: Lower inflation and interest rates generally mean more money is flowing through the economy, with more corporate and retail spending that can pump up stock prices. And as interest rates fall, bond prices tend to rise – that is, bonds you already hold in your portfolio become more valuable to investors.

Conversation starter: “Eating out is still too expensive – but at least my RSP is doing well!”

2. Silicon Valley soars

The backstory: You may have heard of a little company called Nvidia¹. The AI chipmaker was the best performing stock in the S&P 500 index in 2023. It’s also the newest name in the exclusive club of high-performing tech stocks dubbed The Magnificent Seven (which also includes Alphabet, Amazon, Apple, META, Microsoft, and Tesla)².

What happened this year: Most of these tech giants have continued to crush it this year. Since they make up about a third of the S&P 500’s total value, they’ve made a lot of the stock market’s performance look better than it actually is. You’ll be happy to know that all of our Portfolios (except the Money Market Fund) contained Nvidia in 2024.

What’s next: While tech has been having a great run, we don’t put all our eggs in that basket. By diversifying your portfolio, we’re making sure you still benefit from strong tech performance without being overly exposed if (or when) things start to slow down in that sector.

As an example of this strategy, the chart below shows the sector breakdown of underlying investments in the Tangerine Balanced Growth ETF Portfolio, with a still-substantial 25% invested in tech, nearly 17% in financials, and the remainder spread out among other sectors.

Conversation starter: “What do you think will come first, flying cars or self-folding laundry?”

Sector breakdown as at Dec. 6, 2024. Source: 1832 Asset Management L.P. 

3. Politics happened

What happened? Politics played a significant backdrop to the global economic story this year, perhaps more than usual. Uncertainty over whether there would be unrest following this fall’s U.S. election may have priced a bit of caution into market values leading up to it. After a relatively calm election, the markets rallied – while the Loonie slid to its lowest level in years.

What’s next: Our crystal ball is foggy, like everyone else’s, but you can count on a lot of news, and market noise, that you may be better off tuning out.

What that means for you: Anything can happen, and the best way to prepare for that is to ensure you have a mix of assets spread out into different sectors, but also geographically. Our Portfolios already do this. For example, the Tangerine Balanced Growth ETF Portfolio counts about 25% of its assets in countries outside of Canada and the U.S. (see chart below).

Conversation starter: “Let's spend our Canadian dollars where they're still worth something – in Canada.”

Geographic breakdown as of Aug. 31, 2024. Source: 1832 Asset Management L.P.

So … what does this mean for me in 2025?

Here’s the thing.

If you were picking your own stocks and bonds, you would want to check that you are diversified across different sectors and countries, and that your assets are correctly balanced to your risk appetite.

But if you’re invested with Tangerine, we do that for you automatically.

• Our low-cost³, passively managed Portfolios contain underlying funds that are designed to track major market indexes. As the market changes, so do your investments.
• Every quarter, we review the Portfolios and rebalance the assets to ensure they maintain the mix of assets targeted for each Fund.
• We’ve got your back with diversification. The index funds that underlie all our Portfolios are invested in a variety of sectors and countries, with the emphasis changing depending upon the Portfolio you choose. Our Core Portfolios have a greater emphasis on Canadian stocks and bonds; our Global ETF Portfolios have more global exposure; and our Socially Responsible Global Portfolios have more concentration in U.S. stocks.
• Our Financial Advisors are here to help you plan for your goals and ensure your Investment Portfolio is aligned to them.

These strategies take the guesswork out of investing.

If you haven’t already, be sure to set up an Automatic Savings Program, a hassle-free way to regularly add money to your Investment Portfolio over time. Automation also takes emotions out of the equation, mitigating the common trap of second-guessing the market.

Until next year…

It’s been a great year for markets, and for your investments with Tangerine. We’ll keep an eye on things as we head into 2025 – and we’ll be sure to keep you posted.

Now, picture yourself again at the holiday party. The question comes to you: So, how have your investments been doing?

Are you ready for it?

¹ Holdings are subject to change and are not buy/sell recommendations.

² Securities mentioned are not buy/sell recommendations.

³ A fund's expenses are made up of the management expense ratio (MER). The MER for each Tangerine Core Portfolio is 1.06%. The MER for the Tangerine Global ETF Portfolio is 0.76%. The MER for each Tangerine Socially Responsible Global Portfolio is 0.82%.

Diversification does not guarantee a profit or eliminate the risk of loss.