WaveFront All-Weather Fund Q1 2026 Commentary

Q1 2026 Quarterly Commentary

by Robert Koloshuk, CIO

Q1 2026 Overview

In Q1 2026, the WaveFront All-Weather Fund returned +1.66%, outperforming the S&P 500 Total Return Index by +599 basis points - the S&P 500 returned -4.33% over the same period.

Since inception in 2019, the Fund has delivered a +8.83% annualized net return with materially lower volatility than equities and a low correlation to both stocks and bonds.

+1.66%Q1 return
+599 bpsvs. S&P 500
+8.83%annualized since inception

The market environment in Q1 again highlighted the importance of diversification across return drivers, regions, and risk types. While Canadian equities were notably strong during the period - particularly energy- and resource-linked segments - global markets remained more mixed. This created a challenging relative backdrop for globally diversified portfolios that are less concentrated in Canada.

Q1 2026 Performance

Updated through March 31, 2026

ITD
WAAV
8.83%
Benchmark
7.41%
1 Year
WAAV
11.90%
Benchmark
19.05%
YTD
WAAV
1.66%
Benchmark
2.48%
1mo
WAAV-3.49%
Benchmark-6.13%
3mo
WAAV1.66%
Benchmark2.48%
YTD
WAAV1.66%
Benchmark2.48%
1yr
WAAV11.90%
Benchmark19.05%
3yr
WAAV8.80%
Benchmark11.17%
5yr
WAAV6.33%
Benchmark7.06%
ITD
WAAV8.83%
Benchmark7.41%

*Disclaimer: All performance highlights are since inception on 12/1/2019. Effective January 2, 2025, WaveFront All-Weather Fund, LP merged into WaveFront All-Weather Alternative Fund. The ETF’s performance track record is ported from the LP and reflects historical annual compounded returns net of fees except for figures of one year or less, which are simple returns. Past performance is not indicative of future results. Investment risks, fees, and charges may reduce returns. Correlation to equities refers to the correlation of the fund’s returns to the returns of the S&P 500 Index. TTM trailing 12-month yield is a historical measure based on past distributions and is not indicative of future results. Distributions may include return of capital and should not be confused with total return.

Positioning & Portfolio Design

From a positioning standpoint, the Fund continued to reflect its all-weather design. Equity exposure remained an important return contributor, while the portfolio’s broader asset mix sought to balance participation in equity growth with resilience across a range of macro environments.

The strategy maintained its broad diversification across fixed income, gold, real assets, and the WaveFront Global Diversified Investment Class managed futures/CTA strategy, in addition to its global equity growth strategies.

Duration Risk: A Key Theme

A notable theme during the quarter was duration risk. Fixed income markets were less supportive than many investors had hoped entering the year, and the path of rates remained an important driver of performance across balanced and diversified portfolios.

Our view: portfolios built solely around traditional stock-and-bond assumptions remain vulnerable to shifts in inflation expectations, interest rate volatility, and changing stock/bond correlations - but the solution is not to replace fixed income with more equities and equity derivatives.

Portfolio Allocation

as of March 31, 2026

Equities14.64%
Macro & Trend26.65%
Alt. Defensive20.03%
Real Estate19.19%
Fixed Income19.35%
Special Situations0.13%

*Disclaimer: Portfolio allocations are shown for illustrative purposes only and represent the Fund’s positioning as of the stated date. Allocations are subject to change without notice and may not be representative of current or future holdings. References to asset class, sector, regional, or strategy exposures are intended to provide general portfolio context only and do not constitute investment advice or a recommendation to buy or sell any security.

Gold: Tactical Adjustments

Within the Fund, gold remained an important defensive allocation. There were some tactical adjustments during the period as volatility calmed following the recent selloff.

The strategy added back modestly to its gold exposure at the end of Q1 after years of gradual downward adjustments to total ounces held. The decline from 2019 to 2026 reflects the portfolio’s dynamic approach to risk budgeting and position sizing, not a directional call on gold itself.

Managed Futures: The Diversification Engine

The Fund’s allocation to the WaveFront Global Diversified Investment Class continued to serve its critical role within the all-weather structure — and Q1 2026 was a clear example of why.

While the S&P 500 fell 4.6% amid escalating geopolitical tension and tariff uncertainty, managed futures delivered +7.42%, reinforcing the pattern that has held across 15 major equity drawdowns since 2000: when traditional markets struggle, this sleeve tends to show up.

Although the managed futures sleeve experienced some reduction in weight during the quarter as its own realized volatility increased, it remained the Fund’s largest single allocation. The data above illustrates why: across the worst equity quarters of the past 25 years, managed futures have averaged +4.4% while the S&P 500 averaged -13.4% — a spread of nearly 18 percentage points.

This isn’t diversification in theory. It’s diversification that has delivered when investors needed it most — and it’s a structural feature of how WAAV is built.

Worst 15 Quarters for the S&P 500 Index vs. Managed Futures

Historical returns from Jan 2000 to Mar 2026

Avg S&P 500: -13.4%Avg Managed Futures: +4.4%Avg Spread: +17.8%
Q4 2008Global Financial Crisis
+31.5%
S&P 500: -22.6%MF¹: +8.9%
Q1 2020Covid-19 Pandemic
+19.5%
S&P 500: -20.0%MF¹: -0.5%
Q3 2002WorldCom Scandal
+24.7%
S&P 500: -17.6%MF¹: +7.1%
Q2 2022Inflation & Rate Hikes
+23.8%
S&P 500: -16.4%MF¹: +7.4%
Q3 20019/11 Attacks
+17.7%
S&P 500: -15.0%MF¹: +2.7%
Q3 2011Euro Debt Crisis
+16.9%
S&P 500: -14.3%MF¹: +2.6%
Q4 2018US-China Trade War
+11.5%
S&P 500: -14.0%MF¹: -2.5%
Q2 2002Tech Bubble Burst
+23.2%
S&P 500: -13.7%MF¹: +9.5%
Q1 2001Tech Bubble Burst
+18.4%
S&P 500: -12.1%MF¹: +6.3%
Q2 2010Euro Debt Crisis
+11.6%
S&P 500: -11.9%MF¹: -0.3%
Q1 2009Chinese Markets Turmoil
+9.5%
S&P 500: -11.7%MF¹: -2.1%
Q1 2008Global Financial Crisis
+16.1%
S&P 500: -9.9%MF¹: +6.1%
Q3 2008Global Financial Crisis
+4.7%
S&P 500: -8.9%MF¹: -4.2%
Q4 2000Tech Bubble Burst
+26.3%
S&P 500: -8.1%MF¹: +18.2%
Q3 2015China Slowdown
+9.3%
S&P 500: -6.9%MF¹: +2.3%
Q1 2026Iran Conflict & Tariff Escalation
+12.0%
S&P 500: -4.6%MF¹: +7.4%

Data Source: Bloomberg and WaveFront Global Asset Management Corp. Past performance is not a guarantee of future results. Performance of an index is not illustrative of any particular investment. It is not possible to invest directly in an index. Index returns are unmanaged and do not reflect the deduction of any fees or expenses. Index returns reflect all items of income, gain and loss and the reinvestment of dividends and other income.

¹ Managed Futures represented by the SG CTA Index.

Attribution

Performance in the quarter was driven primarily by the Fund’s alternative defensive and managed futures exposures. Gold was the single largest contributor, adding +129.8 bps, while the WaveFront Global Diversified Investment Class contributed +121.6 bps. Together, those exposures helped offset weakness across parts of the Fund’s equity and REIT allocations.

At the allocation level, Alternative Defensive (+137 bps) and Systematic Macro & Trend (+122 bps) were the primary drivers of quarterly returns. Fixed Income was modestly positive at +4 bps, while Equities were broadly flat overall (+1 bp). REITs detracted (28 bps) during the quarter.

Beyond gold and managed futures, notable positive contributors included Taiwan Semiconductor (+16.4 bps), ARM (+15.8 bps), Primaris REIT (+11.9 bps), and U.S. dollar exposure (+8.8 bps). The main detractors included SAP (-28.9 bps), Allied Properties (-28.0 bps)and Microsoft (-14.6 bps).

Top Contributors

  • Gold Futures +129.8 bps
  • WF Global Diversified +121.6 bps
  • Taiwan Semiconductor +16.4 bps
  • ARM Holdings +15.8 bps
  • Primaris REIT +11.9 bps

Top Detractors

  • SAP -28.9 bps
  • Allied Properties -28.0 bps
  • CAN Apartment Prop. -21.0 bps
  • Microsoft -14.6 bps
  • Boardwalk REIT -10.9 bps

*Disclaimer: Attribution is shown for illustrative purposes only, is based on the stated period, and may not be representative of current or future portfolio positioning or results. Past performance is not indicative of future results.

Outlook

Looking ahead, we believe the case for truly diversified, active portfolio construction remains compelling. Investors continue to face a market backdrop shaped by elevated geopolitical uncertainty, fragile assumptions around traditional income-oriented strategies, and the potential for sharp shifts in equity and rate regimes.

In that environment, the goal of the WaveFront All-Weather Fund remains unchanged: to provide investors with a robust core portfolio solution built to navigate a wide range of market conditions, rather than relying too heavily on any single outcome.

Getting Started

We believe a 5% allocation to WaveFront All-Weather is an effective starting point for any investor or financial advisor looking to build a more resilient investment account.

Download Factsheet

Important Disclosures

This commentary is provided for informational purposes only and does not constitute investment advice, a solicitation, or an offer to buy or sell any security. Past performance does not guarantee future results. All investments carry risk, including the possible loss of principal. The S&P 500 Total Return Index is shown for illustrative comparison purposes only and is not the Fund’s benchmark. Investors should review the Fund’s prospectus and offering documents before investing.

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