Canadian DB pension plans record largest gains of 2025 to date in Q3 amid broad equity and fixed income

TORONTO, Oct. 30, 2025 /CNW/ - RBC Investor Services (RBCIS) reported that Canadian defined-benefit (DB) pension plans under its administration achieved their largest median quarterly return of the year, gaining 4.4% in the third quarter of 2025, and representing a 7.1% increase year-to-date (YTD). This growth was driven by a broad-based mix of equity and fixed income contributions.

"The third quarter of 2025 was unusual in that both equities and fixed income advanced at the same time," said Isabelle Tremblay, Director, Client Solutions, and Asset Owner Segment Lead, RBCIS. "We can attribute the equity returns to resilient corporate earnings, AI-driven productivity and strong deal-making. Gains were especially strong among gold producers, as investors continued to look for stability and diversification through traditional safe-haven assets."

Client pension plans invested in Canadian equities yielded a 9.5% return for the quarter and 21.5% YTD, maintaining the momentum established in the second quarter. The S&P/TSX Composite Index, supported by broad-based gains across sectors, increased by 12.5%, resulting in a YTD return of 23.9%. The Materials sector led the performance, with a substantial 37.8% gain for the quarter and 79.3% YTD, driven by gold producers such as Agnico Eagle and Barrick, which benefited from higher bullion prices and strong quarterly results. Other leading sectors posting significant gains included Information Technology (13.2%), Energy (12.6%), and Financials (10.6%).

U.S. equity markets, represented by the S&P 500 Index (CAD), rose by 10.3% in the third quarter and 11.1% YTD, with the weaker Canadian dollar contributing to the gains due to favourable currency translation effects. The Information Technology and Communication Services sectors posted increases of 15.4% (18.3% YTD) and 14.2% (20.5% YTD), respectively. These gains were supported by strong earnings from the "Magnificent 7" technology companies. Consumer discretionary stocks added 11.7% for the quarter.

Global equity performance also strengthened over the period, with client plans returning 8.7% for the third quarter and 14.5% YTD in global equities, and the MSCI World Index (CAD) gaining 9.4% for the third quarter and 13.6% YTD.

Fixed income assets performed well across the yield curve, supporting overall portfolio performance. Client plans' fixed income allocations returned 1.5% for the quarter and 2.1% YTD. The FTSE Canada Overall Bond Index rose by 1.5% for the quarter and 3.0% YTD, with medium-term bonds generating the strongest returns (2.0% for the quarter and 4.4% YTD).

"The Bank of Canada's decision to reduce its key interest rate by 0.25% on September 17 encouraged fixed income investors, with lower yields supporting broader portfolio outcomes," Tremblay noted.

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About RBC Investor Services

RBC Investor Services delivers investment servicing solutions to Canadian asset managers and asset owners, insurance providers, investment counsellors and global financial institutions. With more than 1,500 employees and offices across the globe, our focus is on safeguarding the assets of our clients and enabling their growth. Part of Royal Bank of Canada, Canada's largest bank, RBC Investor Services has over C$2.7 trillion of assets under administration. Learn more at rbcis.com.

For more information, please contact:
Ylana Kurtz, RBC

SOURCE RBC Investor Services