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					                                                                                                                As at September 30, 2011




 Quarter Ending September 30, 2011



                                                                    Compliments of:
                                                                    Frank Dakos
                                                                    Investment Planning Counsel
                                                                    1100-100 Conestoga College Blvd.
                                                                    Kitchener, ON N2P 2N6
                                                                    Phone: 519-578-2591
                                                                    Email: fdakos@ipckitchener.com
                                                                    Website: www..moneytipswithfrank.com




The Report Card provides a comprehensive review of past, current and potential factors that may impact your
investments. Our goal is to continuously monitor your investments to help you meet your financial objectives.
                                                                               As at September 30, 2011




About This Report
•   While this is a quarterly communiqué, the comments in this Report Card refer to
    the last three and 12 months.
•   Market discussions are related to the indices and do not analyze or reflect your
    personal investments.
•   Counsel Portfolio Services examines the performance and risk management of
    each mandate within your Counsel investment solution.
•   We review the performance, risk management and overall effectiveness of each
    sub-advisor and underlying fund manager.
•   Counsel investment solutions adopt a long-term approach to investing. Each
    portfolio solution is properly diversified to reflect an appropriate:
     –   Asset mix
     –   Geographic allocation
     –   Investment style mix
•   A market-cycle typically refers to a period of between six and eight years.
•   Please refer to the chart at the end of this presentation for further information on
    Counsel portfolio solutions.
•   The benchmarks used for each Counsel investment solution can be found at the
    end of this presentation.
                                              As at September 30, 2011




Agenda
1.   Market & Economic Overview
2.   What The Investment Specialists Say
3.   Review Of Counsel Investment Solutions
                                As at September 30, 2011




1. Market & Economic Overview
                                                                                                                           As at September 30, 2011




       Global Stock Markets: Index Movements
                                                               Performance
                                                                                    Since
                                                                                             Q3:
                 Index                Country
                                                    3-Month
                                                     Return
                                                               YTD
                                                              Return
                                                                        1 Year
                                                                        Return
                                                                                   Mar 9,
                                                                                  2009 Low
                                                                                             • Challenging quarter for all markets
                                                                                   Returns
                                                                                             • Equity returns affected by
World Markets
MSCI World                          International    -15.26    -13.86     -7.04      15.76       concerns over:
MSCI Emerging Markets               International    -23.19    -23.53    -18.14      25.86
MSCI EAFE                           International    -16.35    -17.78    -13.47       9.59        –   Unsustainable European sovereign
North American Markets
S&P 500                             U.S.             -13.87     -8.68      1.14      24.29
                                                                                                      debt levels and its potential impact
NASDAQ Composite                    U.S.             -12.70     -8.33      2.96      28.77            on Europe’s banking sector
Russell 2000                        U.S.             -21.87    -17.02     -3.53      28.44
S&P/TSX Composite                   Canada           -12.02    -11.88     -3.55      21.47        –   Status of the North American
Dow Jones Industrial Average        U.S.             -12.09     -5.74      1.16      21.49            economic recovery
European Markets
FSE DAX                             Germany          -25.41    -20.42    -11.67      17.16        –   Pace of emerging market
Euronext Paris CAC 40               France           -24.79    -19.46    -17.14      10.72
FTSE 100                            U.K.             -12.93    -10.58     -4.41      20.00            economic growth, particularly
Wiener Borse                        Austria          -29.60    -33.91    -23.36      13.16            China
Euronext BEL 20                     Belgium          -17.15    -17.35    -17.70      13.89
ISEQ Overall
Euronext AEX
                                    Ireland
                                    Holland
                                                     -15.24
                                                     -16.92
                                                               -13.24
                                                               -18.60
                                                                          -6.46
                                                                         -13.34
                                                                                     10.24
                                                                                     18.67
                                                                                             •   A global slowdown has been in
OSE Oslo Bors Benchmark             Norway           -17.34    -20.80     -8.69      23.91       place since April 2011
Euronext Lisbon 20                  Portugal         -19.56    -19.10    -18.23       5.73
Spain IBEX 35                       Spain            -17.50    -13.31    -18.72       8.48   •   Slowdown is primarily due to:
SWX SPI                             Switzerland      -11.93    -13.54    -10.51      13.42
OMXC 20                             Denmark          -18.72    -23.44    -15.98      21.41        –   sovereign debt concerns in Europe
Far East Markets
NZX 50                              N.Z.              -3.04      1.04      5.20      12.52        –   unrest in the Middle East
S&P/ASX All Ordinaries              Australia        -12.66    -16.03    -12.22      11.05
Nikkei 225 Average                  Japan            -11.37    -14.94     -7.14       7.82        –   impact from the aftermath of the
Emerging Markets
Hang Seng HIS                       Hong Kong        -21.46    -23.63    -21.32      16.40
                                                                                                      earthquake in Japan in March
Shanghai SE Composite               China            -14.59    -15.98    -11.16       2.89
BSE SENSEX India                    India            -12.69    -19.77    -18.01      30.45
BOVESPA Ibovespa                    Brazil           -16.15    -24.50    -24.64      14.35
Performance is calculated using local currency. Data as at: September 30, 2011
Source: Morningstar Direct, Counsel Portfolio Services
                    As at September 30, 2011




Where Are We?




                ?
                                                                                                As at September 30, 2011




Wild Quarter
13000                                                                                               60


12500                                                          CBOE Market Volatility Index         50
                                                                       up 171%
12000
                                                                                                    40
11500
                                                                                                    30
11000

                                                                 Dow Jones Industrial Average       20
10500
                                                                          down 13%

10000                                                                                               10


9500                                                                                                0
      1


               1


                        1


                                  1

                                 11


                                 11


                                 11


                                 11


                                 11


                                 11


                                 11


                                 11


                                 11
   l-1


            l-1


                     l-1


                               l-1

                              g-


                              g-


                              g-


                              g-


                              g-


                              p-


                              p-


                              p-


                              p-
 Ju


          Ju


                   Ju


                             Ju

                            Au


                            Au


                            Au


                            Au


                            Au


                            Se


                            Se


                            Se


                            Se
 Source: Thomson Financial Inc., Counsel Portfolio Services.
As at September 30, 2011
                                                 As at September 30, 2011




Reasons To Be Negative

• Europe continues to muddle through its sovereign
  debt issues
• Unemployment is high across major developed
  economies
• Markets are increasingly more correlated
• Economic growth is slowing across major economies
  including U.S., China and Brazil
• Short covering by speculators
• China is dealing with an uncomfortably high inflation
  rate of over 6%
• U.S. faces an election year in 2012
                                                                                        As at September 30, 2011




Reasons To Be Negative
• Warnings for a gloomy economic outlook by Central
  Banks and the IMF
   – “…significant downside risks to the economic outlook including
     strains in global financial markets.”
                                             - Ben Bernanke, Chairman of the U.S. Federal Reserve,
                                                  Federal Reserve Statement, September 21, 2011 -

   – “…world economic outlook not so positive.”
                                                        - Stephen Harper, Prime Minister of Canada,
                     in a press conference following a meeting with Finance Minister Jim Flaherty and
                                       Bank of Canada Governor, Mark Carney September 27, 2011 -

   – “…problems in the eurozone are now so big that they have begun to
     threaten the stability of the world economy.”
                                                        - David Cameron, Prime Minister of the U.K,
                                           - in a speech to the Canadian MPs, September 22, 2011 -

   – “The world economy is in a dangerous new phase, with risks on the
     rise, but while the problems are largely economic, the solutions are
     mainly political.”
                 - Christine Lagarde, Managing Director, IMF in a press conference ahead IMF Annual
                                                                       Meeting, September 22, 2011 -
                                    As at September 30, 2011




The World Is In A Cautionary Mood
                                                                       As at September 30, 2011




Why The Focus On Greece?
• The bond market has clearly priced in that Greece will likely
  default on its debt
• Threats building in the European banking system which hold
  Greek debt and debt from peripheral European economies
• Greece shares the single currency, the euro (a monetary union).
  Difficult for the 17-nation euro area’s political leaders to reach a
  prompt agreement without a fiscal union
• The longer it takes to reach a solution, the more it will impact
  investor confidence – expect volatility and short-term pain to
  continue




 Collective commentary from Mawer Investment Management Ltd., Picton
 Mahoney Asset Management and Thornmark Asset Management Inc.
                                                                                      As at September 30, 2011




Greek Bond Yields At Record Levels
                    Greek 2-Year Bond Spread Against German Bund




•   Greek yields are once more reaching record highs
•   A promising expansion of the main European bailout mechanism has
    been agreed upon in principle, but its implementation seems to be
    considerably less certain
Source: The Global Investment Outlook, RBC Investment Strategy Committee, Fall 2011
                                                                                      As at September 30, 2011




Spanish And Italian Bond Yields Rising
    Spanish and Italian Greek 2-Year Bond Spread Against German
                               Bund




•   Alarmingly, Italy and Spain have now been sucked into the vortex of
    fear, increasing their borrowing costs
•   The risk is that their temporary liquidity problems could become
    solvency problems should the cost of borrowing continue to rise
•   These countries are many times larger than Greece,Ireland and
    Portugal
Source: The Global Investment Outlook, RBC Investment Strategy Committee, Fall 2011
                                                                As at September 30, 2011




European Nations Have Been Through This Before:
Usual Workout Period Has Been 4 to 9 Years
            Select European Economies Undergoing Large Fiscal
                               Adjustments
            Imbalances and Workout Periods 1981 through 2009




Source: Empirical Research Partners
                                                                  As at September 30, 2011




Correlation




•   Performance of the S&P500 (2001-2011) resembles performance of
    MSCI Japan (1990-2000)
•   Will the next 10 years for the S&P 500 have a similar pattern to the
    MSCI Japan (2001-2011)?
•   Remember – past performance or data mining is not indicative of future
    performance
                                                                    As at September 30, 2011




Are We In For Another Crash Or Financial
Crisis?
• Correction - Yes
• Financial crisis - Maybe
Our Investment Specialists say:
• “We do not feel that much has changed from a year ago. European
  sovereign debt problems first surfaced in May of 2010, U.S.
  Government debt problems have been mounting for almost three years
  and China has been trying to control developing world growth for the
  better part of a decade. We continue to stick to our view that this will be
  a long and pronounced bottoming process for developed economies as
  debt problems are sorted out by consumers, corporations and
  governments.” – Leon Frazer & Associates Inc.
• “At this point, another recession seems unlikely given most developed
  economies have never fully recovered from the last” – Montrusco Bolton
  Investments Inc.
                                                                        As at September 30, 2011




Are We In For Another Crash Or Financial
Crisis?
•   “We do not believe the U.S. will tip back into recession territory. The
    economy is doing reasonably well in some respects. However, job
    growth, housing and credit expansion have not yet demonstrated
    consistent improvement and are a primary reason why consumer and
    business confidence remain at low levels.” – Marsico Capital
    Management, LLC
•   “Despite the “crisis of policy confidence” in the eurozone, it is likely that
    words will be turned into action. Those actions, however, will include
    more fiscal austerity and this will likely contribute to a recession in
    Europe. In emerging markets where growth is stronger, there are
    inflation pressures that could lead to tighter monetary policy. Therefore,
    growth in these markets is also subject to risks on the downside. -
    Thornmark Asset Management Inc
•   “At this stage, we do not believe that a North American recession is
    imminent.” – Acuity Investment Management Inc.
                                               As at September 30, 2011




Is It All Doom And Gloom?
• Oil and food prices are falling
• Mortgage rates are expected to remain low
• Companies are sitting on record amounts of cash
• U.S. and Canadian banks have replenished their
  balance sheets
• Stocks are not trading at expensive levels
                                                                                 As at September 30, 2011




Good News: Cash On Balance Sheets
Apple                                                           $59.71 Billion
Microsoft                                                       $41.25 Billion
Cisco Systems                                                   $40.23 Billion
Pfizer                                                          $36.40 Billion
Google                                                          $34.98 Billion
General Electric                                                $29.64 Billion
Johnson & Johnson                                               $27.66 Billion
General Motors                                                  $26.62 Billion
Intel                                                           $24.49 Billion
Oracle Corp                                                     $24.36 Billion
Source Globe & Mail, Sept 27, 2011 – Moody’s Investor Service
                                                            As at September 30, 2011




Reasons To Be Positive
• Companies have large cash balances
   – did not have this amount of cash sitting on the sidelines in
     2008
• Politicians are working together
• Markets been through rough periods before
                                                                                      As at September 30, 2011




Equity Valuations Are At Attractive Levels
                      World Equity Market Trailing PE Ratio




•   Despite solid earnings, equity market valuations tumbled in mid-summer as risk
    aversion soared and the market priced in a greater likelihood of a second recession in
    three years
•   Margins for TSX-listed companies show a solid expansion that has not yet been
    dented - a key point that is often overlooked during times of extreme market turmoil
•   For many corporations, current sales are simply not that sensitive to wild swings in
    newspaper headlines
•   Companies have spent the last three years trimming fat from their operations. Each
    dollar of top line sales now delivers a near-record stream of profits to the bottom line


Source: The Global Investment Outlook, RBC Investment Strategy Committee, Fall 2011
                  As at September 30, 2011




It Will Be Slow
                 As at September 30, 2011




Source: Forbes
                                                                                                                                                                                    As at September 30, 2011




            Canadian Currency Performance
                   CAD vs. U.S. Dollar                                                                               CAD vs. Euro
 1.08                                                      0.90

 1.06
 1.04
 1.02
 1.00                                                      0.75
 0.98
 0.96
 0.94
 0.92
                                                           0.60
 0.90




                                                                  9/30/2010

                                                                              10/30/2010


                                                                                           11/30/2010


                                                                                                        12/30/2010


                                                                                                                      1/30/2011

                                                                                                                                  2/28/2011

                                                                                                                                              3/30/2011


                                                                                                                                                          4/30/2011

                                                                                                                                                                      5/30/2011


                                                                                                                                                                                     6/30/2011

                                                                                                                                                                                                 7/30/2011


                                                                                                                                                                                                             8/30/2011


                                                                                                                                                                                                                         9/30/2011
        10


        10

        10
         0




         1

         1

         1


         1

         1


         1

         1


         1


         1
       01




       01

       01

       01


       01

       01


       01

       01


       01


       01
      20


      20

      20
     /2




     /2

     /2

     /2


     /2

     /2


     /2

     /2


     /2


     /2
    0/


    0/

    0/
   30




   30

   28

   30


   30

   30


   30

   30


   30


   30
  /3


  /3

  /3
 9/




 1/

 2/

 3/


 4/

 5/


 6/

 7/


 8/


 9/
10


11

12




Source: Bank of Canada            Source: Bank of Canada                                                                                                                          Source: Bank of Canada



           • The European sovereign crisis caused a flight to safety to the U.S. dollar
           • U.S. dollar appreciation and lower oil prices led to a drop in the Canadian
             dollar
           • Comments by political leaders that the world is in turmoil also supported
             the U.S. dollar
                                                                                                                       As at September 30, 2011




             Canada: Equities Versus Fixed Income
       Short-term: Equities vs. Bonds                                       Long-term: Equities vs. Bonds
10%                                                                   10%
                                                                       9%
 5%                                                                    8%
                                                                       7%
 0%                                                                    6%
           1 month           3 month        6 month          1 year
                                                                       5%
 -5%                                                                   4%
                                                                       3%
-10%
                                                                       2%
                                                                       1%
-15%
                                                                       0%
-20%                                                                        3 year      5 year       10 year         15 year        20 year

                     Bonds - DEX Universe   Equities - S&P/TSX                       Bonds - DEX Universe      Equities - S&P/TSX
Source: Globe and Mail

       • Fixed income, which was written off by many investors at the beginning of the year
         because of the fear of inflation, was again the saviour for well balanced investors
       • A run to safety due to Europe’s crisis, coupled with politicians calling for global interest
         rates to be kept low for several years were the main causes of fixed income
         appreciation
       • Equity valuations are cheap and, at some point, a reversion to the mean has to occur
       • However we need to demonstrate patience first
                                                                                                    As at September 30, 2011




      Canadian Market Overview
Investment Style Performance                         Market Cap Performance




                                                                       S&P TSX 60 Total Return
                 MSCI Canada Growth Index
                                                                       S&P TSX Completion Total Return
                 MSCI Canada Value Index.                              S&P TSX Small Cap Total Return


Source: Morningstar Direct                      Source: Morningstar Direct

•    Global slowdown affected Canada
•    Defensive sectors such as Utilities and                Market Sector
                                                                               Year-on- Year-to- Q3
                                                                                Year     date   2011
     Consumer Staples provided the most
                                                        Energy                   -13.13  -23.95 -23.05
     security. Utilites was the only positive           Materials                 -5.95  -17.67 -8.80
     sector                                             Industrials               -8.16  -13.02 -20.61
                                                        Consumer Discretionary   -10.04  -15.84 -15.05
•    Energy was affected by oil prices, which           Consumer Staples           8.89    3.79 -0.89
     have declined since April                          Healthcare                22.20   12.22 -6.93
                                                        Financials                 0.17   -4.72 -10.12
•    Slowing economic growth also affected              Info. Technology          -5.76  -13.59 -15.79
     Industrials and Consumer Discretionary.            Telecom Services          13.79   13.47 -0.85
•    Caution recommended                                Utilities                 10.63    5.55   3.57
                                                                                                             As at September 30, 2011




          U.S. Market Overview
    Investment Style Performance                              Market Cap Performance



                                                                                      S&P 500 Total Return
                         Russell 1000 Value Index                                     S&P Mid Cap 400 Total Return
                         Russell 1000 Growth Index                                    S&P Small Cap 600 Total Return



    Source: Morningstar Direct                         Source: Morningstar Direct


•      Europe’s debt concerns political confusion in the                                 Year-on- Year-to- Q3
                                                                      Market Sector
       U.S. were the culprits of volatility                                                Year    date   2011
                                                                  Energy                      5.61 -12.62 -20.86
•      Utilities was the only positive sector, perhaps            Materials                  -8.73 -22.98 -24.96
       supported by investors seeking capital preservation        Industrials                -6.72 -16.11 -21.51
       and/or higher dividend yields                              Consumer Discretionary      4.56  -6.77 -13.32
                                                                  Consumer Staples            6.40   1.03 -4.94
•      Most severe declines seen in sectors most closely          Healthcare                  3.95   0.81 -10.51
       linked with economic activity and macroeconomic            Financials                -17.66 -25.94 -23.12
                                                                  Info. Technology            2.81  -6.52 -7.96
       outlook, both of which weakened during the quarter
                                                                  Telecom Services            0.39  -5.22 -9.18
•      Energy was affected by oil prices, which have              Utilities                   7.15   7.17   0.44
       declined since April                                        Returns measured in U.S. dollar terms
•      Caution recommended
                                                                                         As at September 30, 2011




 International Market Overview
• Europe, in particular Greece, were
                                        Investment Style Performance
  forefront in the global crisis
• The fear of a contagion and
  political mismanagement affected
  European equities                                       MSCI EAFE Value

• Defensive sectors such as Utilities                     MSCI EAFE Growth

  and Consumer Staples provided
  the most security
• Energy was affected by oil prices,    Source: Morningstar Direct

  which have declined since April                 Market Sector
                                                                    Year-on- Year-to-  Q3
                                                                     Year     date    2011
• Slowing economic growth also               Energy                     2.34    -9.54 -13.73
                                             Materials                 -9.19   -20.41 -18.98
  affected Industrials and Consumer          Industrials               -5.83   -12.62 -15.22
                                             Consumer Discretionary     0.45    -6.50  -9.59
  Discretionary.                             Consumer Staples           7.67     5.98   1.63
                                             Healthcare                 6.67     6.60  -2.55
• Concerned that there are no quick          Financials               -15.78   -17.70 -16.45
  fixes to Europe’s problems                 Info. Technology           2.82    -4.06  -1.80
                                             Telecom Services           2.01     1.63  -2.61
                                             Utilities                 -1.07     0.30   0.57
                                             Returns measures in Canadian dollar terms
                                   As at September 30, 2011




2. What The Investment Specialists Say…
                                                                    As at September 30, 2011




On Equities vs. Bonds
•   “Fundamentals have been thrown out. Businesses are priced for
    perpetual decline and there is really no improvement in conditions. It
    has created huge opportunities for those who rationally assess business
    values during times of stress. Further, many developed stock markets
    now have dividend yields which are greater than their respective 10-
    year bond yields, adding to the relative attractiveness of equities.” –
    Mackenzie Cundill Investments Inc.
•   “After the substantial decline in yields over the third quarter, we
    anticipate volatility to continue, but believe that the moves may be less
    significant in the coming months.” – Acuity Investment Management Inc.
                                                                      As at September 30, 2011




On Interest Rates
•   “To mitigate any potential economic tipping point, the global central
    banks, in our opinion, will continue to be extremely accommodating for
    the foreseeable future. For example, the U.S. Federal Reserve (Fed)
    has commenced Operation Twist and the Bank of England has
    announced its second quantitative easing program (QE2).” – Dreman
    Value Management, LLC
•   “We do not believe the U.S. Federal Reserve (Fed) will increase rates
    unless some of the economic numbers improve and unemployment
    drops… the German Bundesbank is an inflation-oriented central bank.
    If they believe that inflation data is surfacing, they are likely to raise
    rates, which could give some short-term support to the currency.
    However, if the European Central Bank embarks on this path, we would
    be unsurprised if at some point they are forced to reverse. ” – Mawer
    Investment Management Ltd.
                                                                      As at September 30, 2011




On Current Bond Yields And The Expectation For
The Direction of Long-Term Yields
•   “We feel that yields at the end of the reporting period may reflect
    excessive pessimism in many developed economies, in effect pricing in
    a recession along with the increased risks in Europe. While Europe is
    likely either teetering on the brink or already in recession, at this point
    we feel that the U.S. is maintaining a moderate growth pace. A North
    American recession does not appear imminent, although a spillover of
    Europe’s problems coupled with a contractionary fiscal policy in the U.S.
    could put growth in jeopardy at some point next year. As a result, after
    the substantial decline in yields over the third quarter, we anticipate
    volatility to continue, but believe that the moves may be less significant
    in the coming months.” – Acuity Investment Management Inc.
                                                                  As at September 30, 2011




On North America vs. Europe vs. The Emerging
Markets
•   “There are opportunities everywhere. We are looking in Europe as
    those markets have been amongst the world’s weakest performing. We
    are exposed to emerging markets directly through Samsung Electronics
    and through large multinational companies such as Carrefour SA and
    Honda Motors, both of which have business units in emerging market
    economies. Risk is reduced through buying companies which are
    trading at significant discounts to their net asset value.” – Mackenzie
    Cundill Investment Management Inc.
•   “We continue to favour North American equities over European equities
    as sovereign debt concerns overhang European markets and its banks.
    The North American fiscal and political situation is a concern. U.S.
    economic prospects will remain uncertain as consumers are cautious in
    light of ongoing weakness in the housing sector. Growth in the emerging
    markets is slowing, but we expect that it will likely outperform Europe
    and North America. Our mandate is 100% Canadian equities.” –
    Montrusco Bolton Investments Inc.
                                                                       As at September 30, 2011




On North America vs. Europe vs. The Emerging
Markets
•   “It is our belief that the growth in Asia is real. From our perspective, the
    global recession only helped to accelerate what was already a gradual
    shift in the economic engine of the world. Further, it seems that the
    forces that drive the global ‘two-speed’ economy are structural in nature.
    This suggests to us that this is a theme that is likely to continue into the
    long-term and should underlie future outlooks for quite some time.” –
    Mawer Investment Management Ltd.
•   “Overall, our view is that there are enough vested interests aligned at
    the table to avoid a full-fledged European banking crisis. But avoiding
    this fate will not be easy and the European leaders must avoid any
    significant missteps. We do hope that the leaders attempt to deal with
    the issues now, as opposed to later, as has been their policy over the
    last year. We would note, however, that we expect investor sentiment to
    be highly volatile throughout this process and for as long as there
    remains uncertainty.” – Mawer Investment Management Ltd.
                                                                     As at September 30, 2011




On North America vs. Europe vs. The Emerging
Markets
•   “We remain concerned about the near term prospects for capital
    markets due primarily to the challenges confronting Europe. A speedy
    resolution does not appear to be at hand given the meaningful political
    and financial complexities European policy makers face, although they
    are gradually making progress.” – Acuity Investment Management Inc.
•   “While Europe is likely either teetering on the brink or already in
    recession, at this point we feel that the U.S. is maintaining a moderate
    growth pace. A North American recession does not appear imminent,
    although a spillover of Europe’s problems coupled with a contractionary
    fiscal policy in the U.S. could put growth in jeopardy at some point next
    year.” – Acuity Investment Management Inc.
•   “Global risks are at a heightened level. Our current expectation is for an
    outright economic contraction in Europe, while the probability of a
    recession in North America is maintained at 50%.” – Thornmark Asset
    Management Inc.
                                                                    As at September 30, 2011




On North America vs. Europe vs. The Emerging
Markets
•   “We believe modest growth will continue in North America as it will take
    years for consumers to reduce debt loads. The situation in Europe is
    disconcerting and the status of their monetary union is very much in
    question. Though mindful of a sentiment driven shift in stock prices that
    could occur from further disruption in Europe, we feel the cash flow,
    earnings, and dividends of the companies we own are fairly well
    insulated from ramifications resulting from a European sovereign
    default.” – Leon Frazer & Associates Inc.
                                                                   As at September 30, 2011




On Commodities
•   “Over the long-term, the continued strength in Energy and Commodity
    prices is expected to remain due to demand from the emerging
    economies.” – Thornmark Asset Management Inc.
•   “It would appear the formula for a stronger gold price has some negative
    sentiment, but just not too much. These conditions make investing in
    gold stocks difficult and unpredictable.” – Howson Tattersall Investment
    Counsel
                                                                      As at September 30, 2011




On Market Volatility
•   “We expect market volatility to remain elevated as investors grapple with
    the economic situation. For long-term investors, though, equity
    valuations appear attractive at current prices.” – Mawer Investment
    Management Ltd.
•   “Volatility creates opportunity for us, and we look to buy companies
    which have significant discounts to their NAV. While we do not forecast,
    it is fair to say that volatility will remain until there is clarity around
    economic and fiscal issues in Europe and the U.S.” – Mackenzie Cundill
    Investment Management Inc.
•   “We are constructive on the prospects for equity markets over the next
    year, but history shows us that stocks can overshoot on the downside
    during bear markets.” – Picton Mahoney Asset Management
                                                                       As at September 30, 2011




On The Recovery
•   “Over the past twelve months, both Europe and the U.S. have struggled
    to bring a self-sustaining recovery to life and to overcome the hurdles
    that were presented to them in the last crisis. We see little changing
    over the next twelve months. If anything, the recovery should continue
    to improve… Companies now have a higher proportion of cash on their
    balance sheet than anytime in the past 50 years. Earnings and
    earnings momentum have also improved over the last year and the U.S.
    banking system appears both better capitalized and more stable. On
    the other hand, while corporations are flush with cash, they are still
    doing little with it. ” – Mawer Investment Management Ltd.
•   “We feel that despite the near term risks, corporate balance sheets
    remain strong and expect them to outperform government bonds over
    the mid- to long-term.” – Acuity Investment Management Inc.
•   “Stability in credit markets will be the precursor to any significant rally.
    We continue to believe that any stock market rally will be in the context
    of a longer term trading range.” – Picton Mahoney Asset Management
    Inc.
                                    As at September 30, 2011




3. Review of Counsel Investment Solutions
                                                                                                                                                                               As at September 30, 2011




               Counsel Balanced Portfolio




                                                                                Target Allocation
                            Mandate                                                                                                        Current Target Allocation*
                                                                                   (Oct 2009)*
          Canadian short term fixed income                                             n/a                                                                7.00%
          Fixed income                                                               40.00%                                                               33.00%
          Canadian value equities                                                    8.00%                                                                7.75%
          Canadian growth equities                                                   8.00%                                                                7.75%
          U.S. value equities                                                        7.50%                                                                7.00%
          U.S. growth equities                                                       7.50%                                                                7.00%
          International value equities                                               7.50%                                                                7.00%
          Internationa growth equities                                               7.50%                                                                7.00%
          Global small cap                                                           8.00%                                                                10.50%
          Global real estate                                                         6.00%                                                                6.00%
* Target asset allocation weights adjusted following annual review of Counsel portfolios and with the renewal of the simplified prospectus on October 26, 2011.
This Portfolio is managed using a multi-manager process. The current sub-advisor or underlying mutual fund manager for each mandate is listed beside the mandate for which it provides portfolio
management / sub-advisory services. This Portfolio invests in underlying mutual funds (which may be managed by Counsel) currently sub-advised by the sub-advisors listed beside each investment
mandate. For information on the underlying funds, please refer to the prospectus, which is available on our website
at www.counselservices.com or on the SEDAR website at www.sedar.com.
                                                                                                                             As at September 30, 2011




           Counsel Balanced Portfolio
       Effective Asset Class Mix                                                    Effective Top 10 Sector Allocation
100%                                                                                 25%
90%
                                                                                     20%
80%
70%                                                                                  15%
60%
50%                                                                                  10%

40%
                                                                                     5%
30%
20%                                                                                  0%




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                      Geographic
           Effective Sep-10 Jun-11 Sep-11 Mix




                                                                                    om
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                                                                                  C
55%
50%                                                                                               Sep-10   Jun-11   Sep-11
45%
40%
35%
30%
25%
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                          Sep-10       Jun-11       Sep-11
                                                                                                                                                     As at September 30, 2011




      Counsel Balanced Portfolio




      Positive and negative attribution for Q3 2011
                   Canadian                       Cdn          Cdn           U.S.     U.S.     Int'l              Int'l        Global     Global         Portfolio
                   short term        Fixed       value       growth         value   growth    value             growth         small       real         Design &
Mandate          fixed income       income      equities     equities      equities equities equities           equities        cap       estate       Construction
Attribution             -               -          +            -             -        -         -                  -             -          -               -



      Positive and negative attribution for the 12 months ended September 30, 2011
                   Canadian                       Cdn          Cdn           U.S.     U.S.     Int'l              Int'l        Global     Global         Portfolio
                   short term        Fixed       value       growth         value   growth    value             growth         small       real         Design &
Mandate          fixed income       income      equities     equities      equities equities equities           equities        cap       estate       Construction
Attribution             +              +           +            -             -        -         -                  +             -          -               -




      +       Positive attribution to overall Portfolio, reflecting that the mandate outperformed its relative benchmark on a gross returns basis.
      -       Negative attribution to overall Portfolio, reflecting that the mandate underperformed its relative benchmark on a gross returns basis.
                              As at September 30, 2011




Counsel Balanced Portfolio:
2010 Annual Distributions
                                                                                                                                As at September 30, 2011




       Counsel Short Term Bond

      Effective Investment Mix                                                     Effective Bond Maturity
70%                                                                         100%

60%                                                                         90%
                                                                            80%
50%
                                                                            70%
40%
                                                                            60%
30%
                                                                            50%
20%                                                                         40%
10%                                                                         30%

0%                                                                          20%
       Corporate   Federal       Provincial    Mortgage &    Cash & cash    10%
                                               Real estate    equivalents
                                                                             0%
                                                                                     Under 1 Yr   1 - 5 Yrs        5 - 10 Yrs   20 + Yrs
                        Sep-10     Jun-11     Sep-11

                                                                                                  Sep-10      Jun-11   Sep-11
                                                                               As at September 30, 2011




     Counsel Short Term Bond



                   Contributors                    Detractors         Strategic Shifts
Q3        • Absolute returns were              • Overweight           • None
            positive given the significant       corporate credits
            decline in interest rates over
            the period
          • Overweight corporate credits
               – provided incremental return
                 through yield enhancement
Past 12   •   Not applicable.
months         – TD was appointed as sub-advisor for the mandate in
                 October 2010
                            As at September 30, 2011




Counsel Short Term Bond:
2010 Annual Distributions
                                                                                                                                           As at September 30, 2011




         Counsel Fixed Income




      Effective Investment Mix                                                  Effective Bond Maturity
                                                                              45%
60%
50%                                                                           40%
40%                                                                           35%
30%
                                                                              30%
20%
10%                                                                           25%
 0%                                                                           20%
                                                                         al
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                                                                                    Under 1 Yr   1 - 5 Yrs     5 - 10 Yrs    10 - 20 Yrs     20 + Yrs

                         Sep-10         Jun-11     Sep-11                                             Sep-10     Jun-11     Sep-11
                                                                    As at September 30, 2011




Fixed Income
             Contributors           Detractors             Strategic Shifts

Q3        • None               • High yield bonds       • Substantially
                               • Underweight              reduced exposure
                                 government bonds         to high yield bonds
                               • Overweight               and convertible
                                 investment grade         debentures
                                 corporate bonds
Past 12   • Exposure to real   • High yield bonds
months      return bonds not   • Holding of bonds
            on the benchmark     which have a shorter
                                 duration relative to
                                 the benchmark
                               • Overweight
                                 investment grade
                                 bonds
                            As at September 30, 2011




Counsel Fixed Income:
2010 Annual Distributions
                                                                          As at September 30, 2011




 Counsel Canadian Value




                Contributors             Detractors              Strategic Shifts
Q3        • Barrick Gold           • Methanex                •    None
          • BCE                    • Encana
          • Teck Resources         • Enbridge
Past 12   • Zero exposure to RIM   • EnCana
months    • BCE                    • Yellow Media
          • TMX Group              • Sherrit International
                                                                                                            As at September 30, 2011




Counsel Canadian Value
       Effective Asset Class Mix                                  Effective Top 10 Sector Allocation
100%                                                              30%
90%
                                                                  25%
80%
                                                                  20%
70%
60%                                                               15%

50%                                                               10%
40%                                                               5%
30%
                                                                  0%
20%




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                     Sep-10   Jun-11      Sep-11
                                                                                 Sep-10   Jun-11   Sep-11
                            As at September 30, 2011




Counsel Canadian Value:
2010 Annual Distributions
                          As at September 30, 2011




Counsel Canadian Growth
                                                                                                       As at September 30, 2011




       Counsel Canadian Growth




       Effective Asset Class Mix                                  Effective Top 10 Sector Allocation
120%                                                              30%
                                                                  25%
100%                                                              20%
                                                                  15%
80%                                                               10%
                                                                  5%
60%
                                                                  0%




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          Equities        Income trusts            Cash & cash
                                                    equivalents
                                                                                Sep-10   Jun-11   Sep-11

                     Sep-10   Jun-11      Sep-11
                            As at September 30, 2011




Counsel Canadian Growth:
2010 Annual Distributions
                                                                       As at September 30, 2011




Canadian Growth Equities
               Contributors            Detractors              Strategic Shifts
Q3        • Underweight          • Underweight Consumer       • None
            Materials              Staples
          • New Gold             • Industrials
          • Energy                  – Finning International
             – Talisman Energy
Past 12   • Energy               • Industrials
months       – Baytex Energy     • Underweight Consumer
             – Encana              Staples
          • Materials            • Canadian Oil Sands
                                                                   As at September 30, 2011




Canadian Quantitative Growth Equities
               Contributors              Detractors        Strategic Shifts

Q3        • SXC Health Solutions   • Valeant              • Added Utilities
          • Canadian Utilities       Pharmaceuticals      • Eliminated
                                   • Precision Drilling     Industrials,
                                   • Overweight Energy      Financials and
                                                            Information
                                                            Technology
                                                            sectors
Past 12   • Valeant                • Overweight
months      Pharmaceuticals          Resources
          • Overweight Health
            Care
                                                                      As at September 30, 2011




Counsel U.S. Value




               Contributors           Detractors             Strategic Shifts
Q3        • Information        • Overweight Energy           • None
            Technology         • Underweight Utilities
             – Microsoft
             – Intel
             – Cisco Systems
          • Materials
Past 12   • Consumer Staples   • Consumer Discretionary
months    • Health Care        • Overweight Energy
          • Information        • Zero allocation Utilities
            Technology
                                                                                                          As at September 30, 2011




       Counsel U.S. Value
       Effective Asset Class Mix                                 Effective Top 10 Sector Allocation
100%                                                           25%

90%                                                            20%
80%                                                            15%
70%
                                                               10%
60%
                                                                5%
50%
                                                                0%
40%




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            Equities                      Cash & Equivalents

                                                                               Sep-10   Jun-11   Sep-11
                       Sep-10   Jun-11   Sep-11
                            As at September 30, 2011




Counsel U.S. Value:
2010 Annual Distributions
                                                                       As at September 30, 2011




Counsel U.S. Growth



               Contributors                Detractors        Strategic Shifts
Q3        • Underweight Financials • Materials             • Increased
             – American Express        – Dow Chemical        Consumer
          • Consumer               • Energy                  Discretionary
            Discretionary              – Halliburton Co.   • Reduced cyclical
             – Amazon.com                                    sectors
                                                              – Industrials
                                                              – Materials
Past 12   • Consumer               • Stock selection and
months      Discretionary            underweight
          • Industrials              allocation to:
          • Underweight Financials    – Energy
                                       –    Health Care
                                                                                                           As at September 30, 2011




       Counsel U.S. Growth
       Effective Asset Class Mix                                 Effective Top 10 Sector Allocation
100%                                                            25%

90%                                                             20%
80%                                                             15%
70%
                                                                10%
60%
                                                                 5%
50%
                                                                 0%
40%




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             Equities                      Cash & Equivalents
                                                                                Sep-10   Jun-11   Sep-11
                        Sep-10   Jun-11   Sep-11
                            As at September 30, 2011




Counsel U.S. Growth:
2010 Annual Distributions
                                                              As at September 30, 2011




Counsel International Value




               Contributors         Detractors        Strategic Shifts
Q3        • Sega Sammy         • ING Groep         • None
          • First Pacific Co   • Exor
          • Sekisui House      • Honda Motor Co.
Past 12   • Sega Sammy         • Post NL and TNT
months    • Willis Group         Express
          • First Pacific      • Mediaset
                               • Reliance
                                 Communications
                                                                                                           As at September 30, 2011




          Counsel International Value
       Effective Asset Class Mix                                     Effective Top 10 Sector Allocation
100%                                                                  35%
90%                                                                   30%
80%                                                                   25%
70%                                                                   20%
60%                                                                   15%
50%                                                                   10%
40%                                                                    5%
30%                                                                    0%




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                        Sep-10   Jun-11   Sep-11

                                                                                    Sep-10   Jun-11   Sep-11
                               As at September 30, 2011




Counsel International Value:
2010 Annual Distributions
                                                                       As at September 30, 2011




 Counsel International Growth




             Contributors          Detractors               Strategic Shifts
Q3        • GlaxoSmithKline   • Alstom                • Increased Health Care
          • Unilever          • Siemens               • Reduced Industrials
          • Underweight       • Underweight Japan
            Financials
Past 12   • Fuchs Petrolub    • State Bank of India
months
          • Roche             • Alstom
          • Underweight       • Underweight Japan
            Financials
                                                                                                              As at September 30, 2011




          Counsel International Growth
       Effective Asset Class Mix                                      Effective Top 10 Sector Allocation
120%                                                                   35%
                                                                       30%
100%                                                                   25%
                                                                       20%
80%                                                                    15%
                                                                       10%
60%                                                                     5%
                                                                        0%




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             Equities                     Cash & Cash Equivalents




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                        Sep-10   Jun-11    Sep-11                                  Sep-10   Jun-11   Sep-11
                                As at September 30, 2011




Counsel International Growth:
2010 Annual Distributions
                                                                                      As at September 30, 2011




     Counsel Global Real Estate



             Contributors                Detractors                     Strategic Shifts
Q3        • Stock selection in   • Overweight Hong Kong          • Reduced exposure to:
            Japan and Canada       and China                          – lodging companies in
          • Underweight          • Stock selection in the U.K.           the U.S. and Canada
            Western Europe       • Exposure to emerging               – small capitalization
                                   markets                               office companies in
                                                                         Europe
                                                                 • Increased exposure to:
                                                                      – defensive companies
                                                                         that own high quality
                                                                         retail assets in the U.S.
Past 12   • Stock selection in   • Stock selection in the U.K.
months      Singapore and        • Exposure to Hong Kong
            Australia              and China
                                                                                                                                As at September 30, 2011




       Counsel Global Real Estate
        Effective Asset Class Mix                                   Effective Geographic Mix
80%                                                                 45%

70%                                                                 40%
                                                                    35%
60%
                                                                    30%
50%
                                                                    25%
40%
                                                                    20%
30%
                                                                    15%
20%
                                                                    10%
10%                                                                 5%
 0%                                                                 0%
-10%    Equities   Mortgage & Real   Income Trusts   Cash & Cash          U.S.   Europe   Japan    Emerging Far East   Canada     Cash
                                                                    -5%
                        Estate                        Equivalents                                  Markets

                      Sep-10    Jun-11   Sep-11                                           Sep-10    Jun-11   Sep-11
                              As at September 30, 2011




Counsel Global Real Estate:
2010 Annual Distributions
                                                                                                                                             As at September 30, 2011




      Counsel Global Small Cap




      Positive and negative attribution for Q3 2011
                             Cdn            U.S.         Int'l        Portfolio
                             Small         small        small        Design &
         Mandate              Cap           cap          cap        Construction
         Attribution           -             +             -              -


      Positive and negative attribution for the past 12 months ended September 30, 2011
                             Cdn            U.S.         Int'l        Portfolio
                             Small         small        small        Design &
         Mandate              Cap           cap          cap        Construction
         Attribution           +             +             -             +


+   Positive attribution to overall Portfolio, reflecting that the mandate outperformed its relative benchmark on a gross returns basis.
-   Negative attribution to overall Portfolio, reflecting that the mandate underperformed its relative benchmark on a gross returns basis.
                                                                                                           As at September 30, 2011




       Counsel Global Small Cap
       Effective Asset Class Mix                                     Effective Top 10 Sector Allocation
100%                                                                   25%
90%
                                                                       20%
80%
70%                                                                    15%
60%
                                                                       10%
50%
40%                                                                    5%
30%                                                                    0%
20%




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                      Sep-10   Jun-11    Sep-11
                                                                                    Sep-10   Jun-11   Sep-11
                            As at September 30, 2011




Counsel Global Small Cap:
2010 Annual Distributions
                                                                             As at September 30, 2011




Canadian Small Cap
                   Contributors                 Detractors           Strategic Shifts
Q3        • Materials                      • Financials             • None
             – Fortuna Silver Mines           – GMP Capital
             – Dundee Precious                – Oppenheimer
               Metals                         – Canaccord
                                           • Overweight position
          • Celtic Exploration
                                             and stock selection
          • Guardian Capital                 in the Energy sector
                                              – Grand Cache Coal
                                              – Rock Energy
                                           • Le Chateau
Past 12   • Vector Aerospace               • Consumer
months    • Materials                        Discretionary
               –    Dundee Precious           – Le Chateau
                    Metals                    – Dorel Industries
               –    Fortuna Silver Mines   • Overweight position
          • Dundee Corp.                     and stock selection
                                             in the Energy sector
                                              – Rock Energy
                                              – PHX Energy
                                                                As at September 30, 2011




U.S. Small Cap
               Contributors            Detractors     Strategic Shifts
Q3        •   Kinetic Concepts   • Alere            • None
          •   Brightpoint        • International
          •   Cash                 Rectifier
                                 • Solutia
Past 12   • Kinetic Concepts     • Solutia
months
          • Smart Modular        • Alera
            Technologies         • Nutrisystem
          • Alliance Data
            Systems
                                                                  As at September 30, 2011




International Small Cap
             Contributors           Detractors          Strategic Shifts

Q3        • Lundin Petroleum   • Metso               • Shifted from an
          • Eastern Star Gas   • Ming Fung Jewelry     overweight to an
          • Oji Paper          • Leoni                 underweight in
                                                       Capital Goods
                                                     • Reduced overweight
                                                       to Materials
                                                     • Reduced underweight
                                                       to Utilities
Past 12   • Lundin Petroleum   • Commerz Bank
months
          • SJM Holdings       • Ming Fung Jewelry
          • Mitsubshi Chemical • Nokia
                                                                                                                     As at September 30, 2011




Net Benchmarks
Net benchmark return is calculated using the actual management expense ratio(s) of the equivalent exchange traded fund(s) and
weighing that/those MER(s) by the benchmark/hybrid benchmark weight(s). The weighted MER(s) is/are then added to a typical retail
management fee of 1%. In February 2009, the typical retail management fee for Counsel Fixed Income was revised from 1% to 0.5%.

         Investment Solution                                                           Index
Counsel Conservative Portfolio          60% DEX Universe Bond, 40% MSCI World Total Return

Counsel Regular Pay Portfolio           50% DEX Universe Bond, 30% S&P/TSX Dividend Composite Total Return, 20% MSCI World Total Return

Counsel Balanced Portfolio              40% DEX Universe Bond, 60% MSCI World Total Return

Counsel Growth Portfolio                20% DEX Universe Bond, 80% MSCI World Total Return

Counsel All Equity Portfolio            100% MSCI World Total Return

Counsel Income Managed Portfolio        45% DEX Universe Bond, 45% S&P/TSX Dividend Composite Total Return, 10% S&P 500 Total Return

Counsel Managed Portfolio               40% DEX Universe Bond, 15% MSCI World Total Return, 45% S&P/TSX Composite Total Return
Counsel World Managed Portfolio         40% DEX Universe Bond, 60% MSCI World Total Return

Counsel Fixed Income                    100% DEX Universe Bond Index

Counsel Short Term Bond                 100% DEX Short Term Bond Index

Counsel Canadian Dividend               100% S&P/TSX Dividend Composite Total Return

Counsel Canadian Value                  100% S&P/TSX Composite Index

Counsel Canadian Growth                 100% S&P/TSX Composite Index

Counsel U.S. Value                      100% Russell 1000 Value Index

Counsel U.S. Growth                     100% Russell 1000 Growth Index

Counsel International Value             100% MSCI EAFE Value Index
Counsel International Growth            100% MSCI EAFE Growth Index

Counsel Global Small Cap                100% MSCI World Small Cap Total Return

Counsel Global Real Estate              100% FTSE EPRA/NAREIT
                                                                                                        As at September 30, 2011




General Disclaimers
This report may contain forward-looking statements which reflect our current expectations or forecasts of future
events. Forward-looking statements include statements that are predictive in nature, depend upon or refer to
future events or conditions, or include words such as: “expects”, “anticipates”, “intends”, “plans”, “believes”,
“estimates”, “preliminary”, “typical” and other similar expressions. In addition, these statements may relate to
future corporate actions, future financial performance of a fund or a security and their future investment strategies
and prospects. Forward-looking statements are inherently subject to, among other things, risks, uncertainties and
assumptions which could cause actual events, results, performance or prospects to differ materially from those
expressed in, or implied by, these forward-looking statements. These risks, uncertainties and assumptions
include, without limitation, general economic, political and market factors in North America and internationally,
interest and foreign exchange rates, the volatility of global equity and capital markets, business competition,
technological change, changes in government regulations, changes in tax law, unexpected judicial or regulatory
proceedings, catastrophic events and the ability of Counsel Portfolio Services to attract or retain key
employees. The foregoing list of important risks, uncertainties and assumptions is not exhaustive. Please
consider these and other factors carefully and do not place undue reliance on forward-looking statements.

The forward-looking information contained in this report is current only as of the date of this report. There should
not be an expectation that such information will in all circumstances be updated, supplemented or revised whether
as a result of new information, changing circumstances, future events or otherwise.

Commissions, trailing commissions, management fees and expenses all may be associated with mutual fund
investments. Please read the prospectus before investing. The indicated rates of return are the historical annual
compounded total returns including changes in unit value and reinvestment of all distributions and do not take into
account sales, redemption, distribution or optional charges or income taxes payable by any securityholder that
would have reduced returns. The indices cited are widely accepted benchmarks for investment performance
within their relevant regions, sectors or asset class, represent non-managed investment portfolios, exclude
management fees and expenses related to investing in the indices, and are not necessarily indicative of future
investment returns. Mutual funds are not guaranteed, their values change frequently and past performance may
not be repeated.

              To learn more about Counsel’s investment solutions, please
                                speak to your Advisor.
                                                                         As at September 30, 2011




                                         Your portfolio mix remains consistent
   Review Checklist                        with your risk tolerance.
                                         Your portfolio mix has been
                                           rebalanced to your pre-determined
      Frank W. Dakos
                                           mix (see Portfolio Review).
       519-578-2591
  fdakos@ipckitchener.com                Your portfolio’s long-term performance
 www.moneytipswithfrank.com                is acceptable given your investment
                                           strategy and financial objectives.
                                         Sub-advisors and underlying fund
We are committed to helping you
achieve your financial goals through:      managers have been effective in their
• effective investments                    respective areas of expertise.
• accountability of all parties          Do you have any questions or
• operating with your objectives and
  goals as our guide
                                           concerns?
                                         Is an action plan required?

				
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