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					Mutual Fund Portfolio Strategies Agenda


 •   Investor’s dilemma… Why diversify?
 •   Asset allocation - Why does it matter?
 •   Asset allocation - How it works?
 •   Asset allocation - Why it works?
 •   Asset allocation - What it will do for you.
 •   Why use a Financial Advisor?
                Risk vs Return


                                           100% Equities
Expected         Yes
 Return                           Combinations
           100% Bonds


                                No!
                100% T-Bills



                        Risk/Volatility
            Historical Portfolio Risk vs Return



Higher
                                                     Aggressive

                                           Growth
   RETURN




                                     Balanced

                           Moderate

                      Conservative

   Lower            VOLATILITY                  Higher
           Asset Allocation Investing
                Made Easy …
                                              3. Match to the Asset
1. A profile Questionnaire                     Allocation Portfolio
calculates your Risk Score                      Recommendation

                                                          Aggressive
                       2. Match your risk
                       score to your portfolio’s
                       Investment Objective               Growth


                                                          Balanced

                                                          Moderate


                                                          Conservative
       Investment Personality ?

•   Current Net worth         •   Current Income
•   Financial Goals           •   Taxation Priorities
•   Investment Time Horizon   •   Portfolio Review
•   Needs for Liquidity       •   Past Performance
•   Safety / Risk tolerance   •   Financial Statements
•   Retirement Income Need    •   Existing Investments
•   Other Income Sources      •   Family Income Needs
•   Inflation Protection      •   Estate Preservation
•   Principle Protection      •   Wealth Transfer
What will a balanced Asset Allocation do for you ?
 It will provide Good Long-term Performance !

                                         Asset Mix Universes
                                 Asset Mix Universe
                        15%
                        14%
 Annual Return (Mean)




                        13%          Max Frontier
                        12%
                        11%
                        10%
                         9%                                     Diversified Frontier
                         8%
                         7%
                         6%
                         5%
                         4%
                              0% 2% 4% 6% 8% 10 12 14 16 18 20 22 24
                                             % % % % % % % %
                         Risk (Std. Deviation)
                                                 Risk (Stdev)
                Asset Allocation
                Portfolio Mixes

                                                                                 Equity
                                                                                 100%
                                                            Fixed-
                                                           Income
                                                             20%



                                         Fixed-
                                                                 Equity
                                                                  80%
                                                                              Aggressive
                                                                               Growth
                                        Income
                                          40%     Equity
                                                   60%


                               Equity
                                                           Growth
            Equity    Fixed-
                                40%
             20%     Income


   Fixed-
                       60%
                                         Balanced
                                                                          Equity
  Income
    80%

                     Moderate                                             Fixed-Income
Conservative
        Asset Class Best Funds Report
•   Canadian equity        •   AGF
•   Canadian dividend      •   Franklin Templeton
•   Income trusts          •   Elliott & page (Manulife)
•   Canadian bonds         •   Fidelity
                           •   AIC (buy, hold & prosper)
•   Short term bonds
                           •   AIM Trimark
•   Global bonds
                           •   TD funds
•   US equity              •   Manulife / standard life
•   International equity   •   Big bank funds
•   Money market           •   Phillips Hager & north
•   Specialty funds        •   Cartier partners
•   Sector markets         •   Ethical funds / credit union
             Correlation… Why Does It Work?


                   Int'l Stocks       US Stocks            Can. Stocks        Can. Bonds
80.00%

60.00%

40.00%

20.00%

 0.00%

-20.00%

-40.00%
          1977


                 1979


                        1981


                               1983

                                      1985


                                             1987


                                                    1989


                                                              1991

                                                                     1993


                                                                            1995


                                                                                   1997


                                                                                          1999
    Understanding Your Critical
     Portfolio Success Factors
Your existing financial situation
Your priorities & financial goals
Your investment timeline
Your risk tolerance
Optimal asset allocation
Asset class investment selections
Time in the market !
Not timing the market!
Investment Selection Success Factors

 Historically Successful Returns – ask why?
 Consistent Top Quartile Rankings – ask why?
 Asset Class & Volatility Expectations = Risk
 How does it Compare against its own index ?
 Best Funds Report for past 3, 5 & 10-years
 Front End Fees, Back End Fees, or No Load?
 RSP Eligible? Dollar Limits or Restrictions?
 Low MER or Principle Guarantees, if possible?
 Any Principle or Maturity Guarantees ?
Having your own certified financial planner …

 Do you own mutual funds already?
 Did you know that part of your MER is paid to someone?
 Is this “someone” giving you the service you need?
 Is this “someone” giving you the advice you need?
 Is this “someone” giving you the respect you need?


 Since you are already paying “someone” part of the MER
 why not put your funds under your own control of who
 this advisor should be? … Someone who deserves it !
    Samuel J. Esaw, CFP, CLU, CHFC
•   Certified Financial Planner
•   Chartered Life Underwriter
•   Chartered Financial Consultant
•   Helping build, protect & preserve estates since 1985


• Served Lawyers with the Canadian Bar Association
• Served Doctors with the Canadian Medical Association
• Now serving you with unbiased & independent advice


         Well Informed …            Well Advised

				
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