Quarterly and Annual Review Guide

Transcription

1 Y O U R M A N A G E D A C C O U N T Quarterly and Annual Review Guide

2 YOUR QUARTERLY AND ANNUAL MANAGED REVIEWS With any investment program it is important that you and your Investment Advisor be able to assess your progress toward achieving your investment goals. With your BMO Nesbitt Burns managed portfolio we provide a comprehensive reporting package to assist you with this. Your Quarterly and Annual Managed Reviews are designed to give you concise information which will allow you to track your progress toward your long-term investment goals. It gives you, on a quarterly basis, up-to-date information on the holdings in your managed portfolio, performance, market outlook and all activity in your portfolio. Please use this guide as a resource for understanding your Quarterly and Annual Managed Account Reviews.

3 QUARTERLY COVER PAGE REVIEW Your managed accounts are listed here that are detailed within this quarterly reporting package. If you have more than one managed account and you asked to have all of your accounts in one combined reporting package, they will be listed here along with corresponding page numbers of where each account's detailed report can be found within this package. Your managed account(s) numbers are clearly identified to enable you to track each of your accounts efficiently. Your portfolio manager(s) and the investment mandate or the name of your model portfolio.

4 QUARTERLY REVIEW CONSOLIDATED REPORT: YOUR MANAGED PORTFOLIO AT A GLANCE As you have entrusted us with the management of your assets, we believe that we must be accountable to you for the performance of your accounts in both absolute and relative terms. This consolidated report summarizes your combined managed accounts' performance over different time periods and your overall portfolio's account mix and asset mix. Currency. Indicates the currency of the consolidated report. Performance Overview. Performance is measured since your combined portfolio's inception, over the last months, and over this quarter. Your rate of return figures will always be shown net of fees if paid from your managed accounts. Further, the rate of return figure is annualized for periods measured greater than months. Market value - beginning of period. Indicates the value of your consolidated portfolio at the beginning of each period. Additional contributions/withdrawals. The net dollar value of all additions to and/or withdrawals from your combined portfolio in each time period measured, excluding fees Net amount invested. The total dollar value of your investment adjusted for any contributions and/or withdrawals. Investment growth/loss. Indicates the change in the value of the portfolio adjusted for contributions and/or withdrawals. Market value - end of period. Indicates the value of your portfolio at the end of the reporting period. Your rate of return. Indicates your consolidated rate of return for your managed portfolio measured over different time periods. Please refer to page 7 of this Guide for a detailed explanation on performance measurement. Bar Chart. With any investment program, the best measure of success is the program's ability to achieve your specific investment goals. This bar chart graphically depicts the growth of your managed portfolio since its inception and thus the progress of your portfolio to achieving its goals. The net amount invested has been adjusted for any contributions or withdrawals. 0 Accounts in Your Managed Portfolio. This section and pie chart illustrates the account breakdown of your managed portfolio. It also details for each account in your managed portfolio, the account's current market value, and its percentage weighting in your overall managed portfolio.

5 QUARTERLY REVIEW CONSOLIDATED REPORT: ASSET ALLOCATION One of the key determinants of your investment success is asset allocation. This report provides you with information on your portfolio s current asset allocation, helping you and your Investment Advisor ensure that the allocation remains appropriate for your goals and your risk tolerance.

6 QUARTERLY REVIEW MANAGED ACCOUNT DETAILED REPORT This is the first page of the detailed report for your managed account. If you have more than one managed account, a separate portfolio summary for each will follow. Currency. Indicates the currency of the account, and the currency in which the account is reported. Performance Overview. Performance is measured since your managed account's inception, over the last months, and over this quarter. Your rate of return figures will always be shown net of fees if paid from your managed account. Further, the rate of return figure is annualized for periods measured greater than months. Market value beginning of period. Indicates the value of your account at the beginning of each period. Additional contributions/withdrawals. The net dollar value of all additions to and/or withdrawals from your account in each of the time periods measured, excluding fees. Net amount invested. The total dollar value of your investment in this account, adjusted for any contributions and/or withdrawals Investment growth/loss. Indicates the change in the value of the account over time adjusted for contributions and/or withdrawals. Market value - end of period. Indicates the value of your account at the end of the reporting period. Your rate of return. Indicates the rate of return for your account measured over different time periods. Please refer to page 7 of this Guide for a detailed explanation on performance measurement. Bar Chart. With any investment program, the best measure of success is the program's ability to achieve your specific investment goals. This bar chart graphically depicts the growth of your account since its inception and thus the progress of your portfolio to achieving its goals. The net amount invested has been adjusted for any contributions or withdrawals.

7 QUARTERLY REVIEW ASSET ALLOCATION, TAX INFORMATION AND INVESTMENT OBJECTIVE Asset Allocation One of the key determinants of your investment success is asset allocation. This report provides you with information on your account's current asset allocation, sector or geographical mix, helping you and your Investment Advisor ensure that the allocation remains appropriate for your goals and your risk tolerance. Tax Information Your realized gains/losses. For this quarter and on a year-to-date basis, your cumulative realized gains/losses on your securities sold are reported. Dividends (Distributions). All dividends paid to you during each period are reported. If you have a Quadrant Program account, all distributions paid to you will be reported. Interest. All interest paid to you during each period is reported. Your Investment Objective Setting your investment goals and objectives are a crucial part of the investing process. Your investment time horizon is an important part of establishing your tolerance for investment risk and volatility of investment returns. For example if your time horizon is short, you probably cannot afford to withstand prolonged periods of down-markets - the price that is sometimes paid for the opportunity of achieving above-average long-term returns. We have restated your investment objective here, so that you may balance your investment results against it. 6

8 QUARTERLY REVIEW DETAILED RATES OF RETURN AND RELEVANT BENCHMARKS This section shows your performance against relevant benchmarks. In this section, performance calculations begin at the end of the month in which you opened your account. This is because many of the indices used to evaluate performance are only available on a month-end basis. Rates of return for your portfolio are calculated net of fees if paid from this account. Performance for each of the main asset classes in your portfolio is itemized to provide information on the relative performance of each asset class. The rate of return on the cash component of your portfolio may from time to time appear to be quite high. This is because returns are calculated using the time-weighted methodology. An unusually high number may appear here when you have a large cash balance in your account during the quarter. You earn interest on this cash balance until such time as the assets are invested. This interest payment will typically be paid at the end of the month. If the cash balance in the account is small at the time the interest is paid, the calculated return will be high since the interest payment is related to the cash in the account on that day. When this occurs an asterisk will appear beside the return with the following footnote: *Return reflects cash movement within portfolio during period measured. Benchmark indices correspond to your portfolio, providing a relevant comparison for your portfolio s performance. The time-weighted rates of return for your total portfolio. TIME-WEIGHTED RATES OF RETURN In order to present your performance fairly, we calculate a time-weighted rate of return for both your account and for the indices shown. The actual growth in your account will be affected not only by the manager s investment actions, but also by your contributions to and withdrawals from the account. For example, if you add $00,000 to your account at the beginning of a year where the manager has strong performance, your account will increase not only because of the manager s actions but because there were more funds available to benefit from this performance. A simple growth rate would overstate the manager s skill. Similarly, a withdrawal at the same time would hurt your manager s performance when considering total dollars gained or lost. The time-weighted methodology involves calculations that adjust for contributions to and withdrawals from your account. Thus, this method is the best measure of your account s investment performance. 7

9 QUARTERLY REVIEW INVESTMENT REVIEW This comprehensive investment review covers relevant economic and market information as it relates to your portfolio. Your Investment Advisor will discuss with you how these events have impacted your portfolio, and will work with you to ensure that the manager or model you have selected continues to be the most suitable in order to enable you to achieve your long-term goals. 8

10 QUARTERLY REVIEW ASSETS UNDER MANAGEMENT This report provides a listing of all of the securities in your portfolio at quarter end. It provides detail as to how your portfolio is diversified among the various asset classes as well as within each class. Assets may be segregated by country, by asset class or by sector grouping. This will help you and your Investment Advisor monitor the level of diversification in your portfolio. Unless otherwise indicated all values are in the currency of the account. The following definitions explain each of the columns: Description. The name of the security. Quantity. The number of securities owned in the portfolio. Cash, Short Term Investments and Fixed Income Securities are all shown in dollars, representing the face value. Stocks and mutual funds are shown in number of units Unit Value. Market price of the security as of the reporting date. The Unit Value is shown in the currency of the security. If this is other than the currency of the account, it will be indicated as such with a US or CD to the right of the actual Unit Value. Total Market Value. The total current market value of the investment; Unit Value multiplied by the Quantity. % of Account. Market Value divided by Total Account Average. Average Cost Per Unit. The average cost per unit of the security owned. The Unit Cost includes commission, if any, paid to acquire the securities. It does not include accrued interest paid on bonds. The Unit Cost is shown in the currency of the security. If this is other than the currency of the account, it will be indicated as such with a US or CD to the right of the actual Unit Cost. Total Cost. The Total Cost of the investment in the security; Unit Cost multiplied by the Quantity. Unrealized Gain/Loss. The capital appreciation/ depreciation in the value of the security since its purchase; Total Value less Total Cost. Current Yield. The expected annual income (interest and/or dividends) to be paid on the security divided by the Market Value.

11 ANNUAL REVIEW In addition to your Quarterly Performance and Portfolio Summary, you will receive an annual reporting package which provides additional information to help you monitor your portfolio, and complete your tax return. 0

12 ANNUAL REVIEW EXECUTIVE SUMMARY This report provides a summary of the activity in your account for the past calendar or fiscal year. Opening Value. The value of your portfolio on January st or the first day of your fiscal year. For those clients who joined the Program during the year, the opening asset value will be the assets invested at the time the account is opened. 6 Contributions. Total value of all deposits/contributions made to the account throughout the year. Dividends. Total value of dividends received throughout the year. Interest. Total value of all interest payments received throughout the year. Withdrawals. Total value of all withdrawals made from the account throughout the year. Fees are shown separately on this report. Fees. The total fees, including applicable taxes, paid from your account throughout the year. If fees were charged to another account this information will not appear Execution Costs. A portion of the overall fee paid that has been allocated for accounting purposes to the cost of trading the securities in your account. 8 0 Market Growth. The change in the value of the securities held in the portfolio at the end of the year. It does not include appreciation in the value of securities sold throughout the year. Closing Value. The value of your portfolio on December st, or the last day of your fiscal year. Annual Rate of Return. The annual return earned on your account. For accounts opened during the year, the rate of return shown here is the return earned for the period the account was open. Net Realized Gains/Losses. The net realized gain/loss on all securities sold throughout the year. A separate report itemizes these transactions.

13 ANNUAL REVIEW REALIZED GAINS / LOSSES This report provides an effective summary of all realized gains and losses in the account during the past calendar or fiscal year. Description. The name of the security. Date of Sale. Security sales are shown in date order. Multiple sales of a security over more than one day will be shown individually. Number of Units Sold. The number of units involved in the transaction. Cash, Short Term Investments and Fixed Income Securities are all shown in dollars, representing the face value. Stocks and mutual funds are shown in number of units Unit Sale Price. The average sale price per unit of the security less commission, if any, paid to sell the security. Exchange Rate. For tax purposes all capital gains and losses must be reported in Canadian dollars. This exchange rate represents the weighted average exchange rate applicable on the purchase of the securities and will only appear for non-canadian dollar transactions. Total Proceeds. The dollar value of the transaction calculated as the market price of the security (times the Exchange Rate, if applicable) multiplied by the Quantity. Unit Cost. The average purchase price per unit of the security, including any commission paid to acquire the security. Exchange Rate. For tax purposes all capital gains and losses must be reported in Canadian dollars. This exchange rate represents the weighted average exchange rate applicable on the sale of the security and will appear only for non-canadian dollar transactions. Total Cost. The total purchase price of the securities calculated as the average purchase price per unit of the security (times the exchange rate, if applicable) multiplied by the Quantity. 0 Realized Gain/Loss. Realized gain or loss on the sale of the security; Total Proceeds less Total Cost, in Canadian dollars.

14 ANNUAL PURCHASES REVIEW The annual Purchases report provides a summary of all of the securities purchased in your account during the year in order of date of purchase. The Unit Cost is shown in the currency of the security. If this is other than the currency of the account, it will be indicated as such with a US or CD to the right of the actual unit cost. Total Cost is in the currency of the account. Hence, the Total Cost of a US security purchased in a Canadian account will appear in Canadian dollars. The exchange rate is that which was applicable at the time of the purchase and will only appear for non-canadian dollar denominated securities.

15 ANNUAL REVIEW CONTRIBUTIONS AND WITHDRAWALS This report provides a summary of all security and cash deposits and withdrawals made to or from the account during the year. The value shown for securities deposited to or withdrawn from the account is based on the market price on the day it was placed in or removed from the account.

16 BMO NESBITT BURNS MANAGED ASSETS PROGRAMS The BMO Nesbitt Burns Quadrant Program Based on the principle of protecting and enhancing wealth, the Quadrant Program provides broad diversification by asset class and investment style to manage risk and provide the potential for superior returns. This diversification is achieved by investing in a wide range of asset classes that reflects your particular risk profile. Once the appropriate asset mix is established for your account, we will construct a portfolio that consists of a range of specialized mutual funds each of which combines the talents of some of the leading investment managers in the world. By using this multi-manager approach, investors gain the advantages of an aggregate portfolio. A quarterly fee, based on the assets in your account, covers all of the services provided through the Quadrant Program, including commissions and comprehensive reporting. The BMO Nesbitt Burns BluePrint Program The BluePrint Program provides efficient and cost effective access to BMO Nesbitt Burns top rated* investment research. Through the BluePrint Program, you can access seven portfolios that are fully managed on a discretionary basis by professional portfolio managers. Rather than creating your own portfolio, you work with your Investment Advisor to select from the seven that are already established and are managed to meet specific investment objectives. A quarterly fee, based on the assets in your account, covers all of the services provided by the BluePrint Program, including commissions and comprehensive reporting. The BMO Nesbitt Burns Advance Program The Advance Program combines BMO Nesbitt Burns exceptional services with those of leading independent Investment Managers managers who are generally not available to individual investors. Once your Investment Advisor and you have established your investment goals and formalized them in a written Investment Policy Statement, appropriate Investment Managers are recommended for your consideration. Your Investment Advisor carefully monitors your program to ensure that the results are in line with your expectations and that your needs continue to be met. A quarterly fee, based on the assets in your account, covers all of the services provided through the Advance Program, including commissions and comprehensive reporting. * Brendan Wood International Survey. Institutional Equity Sales and Research in Canada, 00.

17 - BMO (M-bar roundel symbol) is a registered trade-mark of Bank of Montreal, used under licence. - Nesbitt Burns, "Advance Program", "BluePrint Program" and "Quadrant Program" are registered trade-marks of BMO Nesbitt Burns Corporation Limited, used under licence.