Natixis Survey: Most Canadians Fear Future Oil Price Shocks and Feel Powerless When It Comes to Protecting Their Investment Portfolios

- Expect portfolios to earn average annual gains of more than 9%
- Despite aspirations, few have a financial plan or want to take more risk
- Say stocks, real estate will be best asset classes this year

BOSTON & TORONTO--()--Following the drop in oil prices, Canadians worry about further declines, but are still optimistic about their investment portfolios over the long term, according to a survey released by Natixis Global Asset Management, the parent of Toronto-based asset manager NexGen Financial.

The majority of those surveyed (54%) say they fear future oil price drops, 61 percent admit they are not willing to take more investment risk compared to a year ago and 59 percent said they feel vulnerable when it comes to protecting their portfolios from market shocks.

“Following last year’s deep drop in commodities prices, investors have good reasons to be concerned,” said John Hailer, chief executive officer of Natixis Global Asset Management – The Americas and Asia. “This served as a reminder of the sometimes volatile nature of investment markets. Yet many investors haven’t really planned, or prepared themselves emotionally, for another market setback.”

Besides oil prices, investors’ other concerns include a worldwide economic slowdown (cited by 54%), slower global growth (39%) and higher interest rates (37%).

Despite the economic challenges, 88 percent of Canadian investors believe their current approach will enable them to have a steady income when they retire. To get there, investors say their portfolio needs to gain an average of 9.3 percent annually, over and above inflation, the survey found. Eighty percent of investors think their target is realistic.

Rational optimism?
Most investors were pleased with the performance of their portfolios last year, and they expect their gains to be as good or better in 2015. However, relatively few Canadians have solid financial plans or are willing to take the risks that might produce better rewards.

The survey found:

Satisfaction with gains: Seventy-five percent of Canadians were happy with their investments last year. This year, 34 percent think their returns will be better, 53 percent say they’ll be the same and only 13 percent expect they will be worse.

Relatively few investors plan: Just 38 percent of those polled say they follow a financial plan.

Returns vs. protecting capital: Most Canadians (73%) are sometimes conflicted between obtaining returns and preserving capital.

“Without a financial plan or a professional advisor to manage investment risk and reduce portfolio volatility, the odds are diminished that investors will be able to achieve their goals,” Hailer said.

Natixis encourages investors to work with an advisor to create a durable portfolio that can help manage risk and reduce volatility through a mix of alternative investment strategies working in tandem with long-only, traditional investments.

In retirement, promise and peril
Retirement remains the top financial priority, and most investors (57%) say the responsibility of funding retirement is falling increasingly to individuals and away from government- and employer-sponsored schemes.

They anticipate 50 percent of their retirement income will come from their own efforts – saving, investing, selling their home or business or picking up a job after retiring. Of the rest of their retirement income, 26 percent would come from an employer pension, 18 percent from government support and 6 percent from other sources (including support from children).

Investors have several concerns about paying for retirement, with about half saying their financial wellbeing could be hampered by:

• Uninsured health expenses: Cited by 53 percent

• Inflation: 52 percent

• Uninsured long-term care costs: 48 percent

• Failing to save enough money: 47 percent

“Retirement security is influenced by many factors, so it’s important for investors to plan for the unexpected,” said Ed Farrington, executive vice president for retirement for Natixis. “Investors should begin retirement planning earlier, save aggressively, invest effectively and understand their income needs in retirement under various scenarios.”

Finding alternatives to traditional strategies
Canadians like the idea of alternative investments, a group that includes long-short funds, private equity, hedge funds and commodities. The performance of alternatives often does not correlate with broader markets; therefore, they can lessen volatility in a portfolio.

Sixty-three percent of investors say they want to employ nontraditional strategies that do not rely strictly on stock and bonds to generate return. Seventy percent would like to follow an investment approach that protects their investments from volatility.

However, few Canadians currently invest in alternative assets. Only 41 percent of Canadians own alternatives, compared with 50 percent of investors around the world. Just a third of Canadians (34%) say they have a good understanding of alternatives. Education has an important role to play. Eighty-one percent of Canadians agree professional advice is important when making financial decisions.

Faith in stocks, real estate
While a plurality of investors says stocks will generate the strongest investment results in the next year, others have faith in more-defensive asset categories, particularly real estate.

Thirty-one percent say stocks will be the best asset class. Nearly one-quarter (24%) say real estate, with the rest split among cash (12%), commodities (11%), private equity (9%), bonds (8%) and other types of investments (4%).

Natixis surveyed 250 individual investors across Canada with a minimum of C$256,460 (US$205,230) in investable assets. The online survey was conducted in February 2015 and is part of a larger global study of 7,000 investors in 17 countries from Europe, the Americas and the Middle East. The findings are published in a new whitepaper, “Close enough isn’t good enough.” For more information, visit

Important Definitions
Long-short fund - A type of mutual fund that mimics some of the trading strategies typically employed by a hedge fund.
Private Equity - Equity capital that is not quoted on a public exchange. Private equity consists of investors and funds that make investments directly into private companies or conduct buyouts of public companies that result in a delisting of a public equity.
Hedge Funds - Hedge funds are alternative investments using pooled funds that may use a number of different strategies in order to earn active return for their investors.
Commodities - A commodity is a basic good used in commerce. One way to invest in commodities is through a futures contract, which is an agreement to buy or sell, in the future, a specific quantity of a commodity at a specific price.
Volatility – The range of variation in the value of a security.

About Natixis Global Asset Management, S.A.
Natixis Global Asset Management, S.A. is a multi-affiliate organization that offers a single point of access to more than 20 specialized investment firms in the U.S., Europe and Asia. The firm ranks among the world’s largest asset managers.1 Through its Durable Portfolio Construction® philosophy, the company is dedicated to providing innovative ideas on asset allocation and risk management that can help institutions, advisors and individuals address a range of modern market challenges. Natixis Global Asset Management, S.A. brings together the expertise of multiple specialized investment managers based in Europe, the United States and Asia to offer a wide spectrum of equity, fixed-income and alternative investment strategies.

Headquartered in Paris and Boston, Natixis Global Asset Management, S.A.’s assets under management totaled $890.0 billion (€735.5 billion) as of December 30, 2014.2 Natixis Global Asset Management, S.A. is part of Natixis. Listed on the Paris Stock Exchange, Natixis is a subsidiary of BPCE, the second-largest banking group in France. Natixis Global Asset Management, S.A.’s affiliated investment management firms and distribution and service groups include Active Investment Advisors®;3 AEW Capital Management; AEW Europe; AlphaSimplex Group; Aurora Investment Management; Axeltis; Capital Growth Management; Darius Capital Partners; Dorval Finance;4 Gateway Investment Advisers; H2O Asset Management;4 Harris Associates; IDFC Asset Management Company; Loomis, Sayles & Company; Managed Portfolio Advisors®;3 McDonnell Investment Management; Mirova;5 Natixis Asset Management; Natixis Environment & Infrastructure Luxembourg; NexGen; Ossiam; Reich & Tang Asset Management; Seeyond;6 Snyder Capital Management; Vaughan Nelson Investment Management; Vega Investment Managers;4 and Natixis Global Asset Management Private Equity, which includes Seventure Partners, Naxicap Partners, Alliance Entreprendre, Euro Private Equity, Caspian Private Equity and Eagle Asia Partners. Visit for more information.

1 Cerulli Quantitative Update: Global Markets 2014 ranked Natixis Global Asset Management, S.A. as the 16th largest asset manager in the world based on assets under management as of December 31, 2013.
2Assets under management (AUM) may include assets for which non-regulatory AUM services are provided. Non-regulatory AUM includes assets which do not fall within the SEC’s definition of ‘regulatory AUM’ in Form ADV, Part 1.
3Division of NGAM Advisors, L.P.
4 An affiliate of Natixis Asset Management.
5 A subsidiary of Natixis Asset Management.
6A global investment unit of the Natixis Asset Management organization, operated in the U.S. through Natixis Asset Management U.S., LLC.



Natixis Global Asset Management
David Snowden, 617-449-2507

Release Summary

Natixis Survey: Most Canadians Fear Future Oil Price Shocks and Feel Powerless When It Comes to Protecting Their Investment Portfolios


Natixis Global Asset Management
David Snowden, 617-449-2507