August 2021

New Revenue Streams

Global risk appetite improved, with stock markets rising while commodity and fixed income markets declined. Although the Delta variant is slowing the reopening in some regions, companies continued to raise earnings estimates. At the annual Jackson Hole Economic Symposium, the Federal Reserve hinted at tapering their stimulus program later in 2021 but committed to low policy rates for the foreseeable future.

Pfizer‐BioNTech’s COVID‐19 vaccine became the first U.S.‐produced vaccine to receive full FDA approval. Officials hope the approval will reduce some of the ongoing vaccine hesitancy and will allow organizations to implement vaccination requirements. Pfizer is seeking approval for a third booster shot which would be administered 8 to 9 months after the second dose. Pfizer (+7.6%) reported earnings for the first six months of 2021, during which time the company recorded global sales of $11.3 billion USD specifically for BNT162b2, the internal name for their COVID‐19 vaccine.

Corporations looking to shift supply chains have had to delay plans as a resurgence in COVID cases increases border restrictions. Apple (+4.1%), for
example, plans to begin manufacturing their AirPods in Vietnam to reduce their reliance on Chinese production in response to rising trade tensions with the U.S. While plans are delayed indefinitely, management still intends to move at least 20% of production to Vietnam at some point.

In a bid to enter the retail trading market, PayPal (+4.8%) is exploring options that would allow customers to trade stocks on their platform. Last October, PayPal demonstrated their innovation with a foray into cryptocurrency, and this move looks to be a continuation of this ethos. The addition of retail trading revenue should help close the gap left from the loss of one of their largest customers, eBay.

As students prepare to head back into the classrooms, retailers are eyeing the surplus savings of parents who postponed costly summer trips. According to a survey from the National Retail Federation, families with children in elementary school plan to spend an average of $849 USD on school‐related items, an increase of 7.5% from last year. Big‐box retailers, like Canadian Tire Corp. (+0.0%) and Target (‐5.4%), are expecting seasonal sales to climb more than 9% from 2020

Portfolio Contributors

• iShares Global Water ETF (CWW) gained 5.26% for the month as a result of the continued growth in the Industrials sector.
• iShares Global Clean Energy ETF (ICLN) added 3.95% as governments and institutions put a greater emphasis on renewable energy

Portfolio Detractors

• EdgePoint Global Portfolio (EDG500) moved higher over the month, adding 0.75%.
• Steadfast Income Pool (MAJ383) was relatively flat, adding 0.03% as investors shifted towards equities.

All returns are for the reported month and in local‐currency.
All data sourced from SIACharts and FACTSET.