JEWISH FOUNDATION INVESTMENT PERFORMANCE UPDATE FROM STACY ROSEN –QUARTER AND FISCAL YEAR ENDING JUNE 30, 2025

The Jewish Foundation of Greater Toronto’s pooled investment portfolio returned 4.0% on a total return basis in the quarter through June 30, 2025. That brings our performance for the fiscal one-year period to 13.5%. We are also pleased with the portfolio’s average performance over the past several years: 12.3% annually over the past three years, and 9.5% annually over the past five years.

This quarter saw a very turbulent start with Liberation Day tariff announcements in the U.S., leading to increased market volatility. Tariffs were subsequently deferred, which lifted investors’ spirits and led to a recovery rally. A few trade deals were struck during the quarter, culminating with President Trump’s Big Beautiful Bill being passed. In monetary policy, both the U.S. Federal Reserve and the Bank of Canada held their policy interest rates steady, signaling a cautious approach amidst ongoing trade uncertainty and its potential impact on their respective economies.

Looking in more detail at the Jewish Foundation’s portfolio performance drivers over both the fourth fiscal quarter and the full fiscal year, growth was largely driven by strong global public equity markets (up 6.5% in the quarter, and 16.9% for the fiscal year), which make up approximately 54% of the Foundation’s portfolio. Breaking the market growth down into geographic attribution, international equities led with the strongest performance (as measured by the EAFE Index, Europe, Australasia, and the Far East), returning 6% in Canadian dollar terms for the quarter and 17.5% for the fiscal year. U.S. stocks, recovering from a major equity drawdown early in the quarter, returned 5.2% for the quarter and 14.8% for the fiscal year. Canadian stocks were up 8.5% for the quarter, and 26.4% for the fiscal year. Emerging markets stocks returned 6.2% during the quarter and 14.9% for the fiscal year in Canadian dollar terms. Israel equity markets also made a very strong showing this year, also contributing to the year’s positive performance. Although still positive, performance was dampened by limited growth in private and real assets this year, with deal exits across the industry slowing significantly over the quarter and the year. On the plus side for the portfolio, while a depreciating U.S. dollar weakened the performance for most Canadian investors, our U.S. dollar hedge on a strategic portion of the portfolio added 0.5% to our quarterly performance, and 0.4% to our fiscal year performance.

Looking ahead, we believe the U.S. economy may stall over the coming quarters as the growth-reduction effects of tariffs kick in. The worst-case scenario of a severe trade war has likely been averted, and the odds of a recession have diminished, though the jury is still out as to what the effects of the tariffs will be on U.S. inflation. In the Euro area, our medium-term outlook is constructive because of increased fiscal spending, especially in Germany. However, near-term tariff impacts could remain a headwind. Chinese markets are expected to slow in the second half of 2025 as increased tariffs weigh on exports. We believe our portfolio’s diversification, from both an asset class and geographic perspective, will help shield us from the full impact of substantial equity drawdowns.

The Investment Advisory Committee has been quite busy over the last year, reviewing and adjusting our public equity allocations, geographic weightings, and active versus passive levers, while in the process reducing fees and increasing efficiency. We have also continued allocating to high-conviction private market managers in equity, debt, real estate, and infrastructure. As always, we are committed to stewarding the Jewish Foundation’s portfolio during these uncertain times, and we expect our prudent diversification and sound portfolio construction to pay dividends during volatile periods like this. The Investment Advisory Committee maintains a steadfast focus on enhancing returns, while reducing risk and volatility, to compound the power of donors’ philanthropic goals for future generations of our community.