By Scott Ronalds

From our Quarterly Report:

I said last year that 2014 was a “bizarre” year. I feel the same about 2015. I recently heard it described as “violently flat.”

It was a harder year to keep steady because of some extreme outcomes, most of which were not anticipated. We started the year feeling that our loonie was already weak, but it proceeded to fall another 17% relative to the U.S. dollar. The same with oil and other commodities - low went a whole lot lower.

In the course of twelve months, high yield bonds (affectionately known as ‘junk’ bonds) went from being loved and easy to sell (liquid) to despised and sticky (illiquid). Debt levels started the year insanely high and, you guessed it, went still higher, with Canadian consumers and the Ontario government being the poster boys.

More than other years, 2015 reinforced the benefits of diversification. We (our fund managers and I) didn’t see most of these things coming, but by focusing on owning great businesses at good prices, and building portfolios exposed to a broad set of variables, our balanced clients had a positive return for the 7th year in a row.

Read Tom's full brief and the rest of our report here.