your ticket to comprehensive retirement planning

Transcription

1 your ticket to comprehensive retirement planning An investment designed to meet your retirement needs. Retirement will mean a significant transformation to your life you will have the time to enjoy pastimes and pursue goals not possible with a full-time career. RetirementEdge Income Portfolios are designed to help you achieve the financial freedom to make the most of your retirement years. > Growth potential of a diversified portfolio of leading Dynamic Funds What s the Edge? Dynamic RetirementEdge Income Portfolios are leading-edge retirement solutions built with some of Dynamic s core mutual funds. > Automatic asset allocation that grows conservative over time > Reliable cash flow from guaranteed monthly principal repayments > Tax Efficiency potential tax deferral until maturity and non-taxable principal repayments series 11 & 12 One ticket financial planning.

2 > Growth potential of a diversified portfolio of core Dynamic Funds BMO Dynamic RetirementEdge Income Portfolios are structured to provide you with the potential of capital appreciation while paying a guaranteed stream of distributions, in the form of principal repayment. At maturity, investors will receive the total return of the Fund Portfolio over the term of the note plus the deposit balance (if any) less the monthly capital repayments. While the Variable Return is not subject to an upper limit, it can be zero. asset class investment style fund name Dynamic Fund of Canada Target Weight CANADIAN EQUITY Equity Income Growth Dynamic Dividend Fund Dynamic Power Canadian Growth Fund/Class 10% 10% Growth Dynamic Power Small Cap Fund 5% Global EQUITY Growth Focus + Dynamic Power Global Growth Class of Dynamic Global Fund Corporation Dynamic Global Fund Dynamic Focus+ Equity Fund Dynamic Global Discovery Fund Dynamic Global Dividend Fund 10% 5% Fixed Income Core Credit Analysis Dynamic Canadian Bond Fund Dynamic High Yield Bond Fund 33.3% 67.7% Canadian equity component*: > Dynamic Fund of Canada The fund aims to deliver long-term capital appreciation by investing primarily in Canadian companies that are deeply undervalued. Contrarian-style management focuses on out-of-favour and misunderstood companies with solid business fundamentals. > Dynamic Dividend Fund The fund aims to provide a conservative monthly income stream through a diversified portfolio of three equity asset classes: dividend-paying equities, income trusts and preferred shares. The fund targets high-quality companies that generate sustainable dividends and/or cash flow with the added potential for growth. > Dynamic Power Canadian Growth Fund/Class The fund offers a diversified portfolio of established companies with a proven ability to grow earnings. The unique investment discipline combines top-down economic analysis with bottom-up company analysis. > Dynamic Power Small Cap Fund The fund seeks to achieve long-term capital growth by investing primarily in equity securities of small-sized Canadian corporations. The fund is actively managed with due consideration to both risk and return. Global equity component*: > Dynamic Power Global Growth Class of Dynamic Global Fund Corporation This core large-cap global equity fund is driven by the principle that earnings growth equals stock price performance. A strict bottom-up approach is used to create a portfolio containing the fastest-growing companies operating within a broad range of global economies. > Dynamic Global Fund The fund invests in a broad mix of deeply undervalued companies of different market caps operating in different sectors and markets around the world to provide well-diversified global exposure and long-term capital appreciation. > Dynamic Focus+ Equity Fund This fund combines elements of value and growth investing to select a portfolio of equity investments from businesses operating anywhere in the world. Each investment is chosen using a patient and common sense investment approach that is fundamental for capital preservation and the potential for long-term returns. > Dynamic Global Discovery Fund The fund aims to profit from investments in companies that are not well known, unavailable or unwanted by most investors. The goal is to deliver a truly unique portfolio of international equities. > Dynamic Global Dividend Fund Conservatively managed, a broadly diversified fund that invests in well-managed and yet undervalued dividend-paying equities from around the world to deliver long-term growth. Bond component*: > Dynamic Canadian Bond Fund The fund focuses on generating an income stream through investments made in a diversified portfolio of Canadian fixed income securities, primarily federal, provincial and corporate bonds. > Dynamic High Yield Bond Fund The fund seeks to achieve above-average interest income and some potential for long-term capital growth by investing primarily in Canadian corporate bonds. The management approach is a blend of top-down and bottom-up analysis. * The relative weightings of the funds comprising the equity and fixed income components may vary due to fluctuations in the market values of the units of each fund. However, the target weighting of each fund in the equity and fixed income components will be restored on each annual rebalancing date. 3

3 > Automatic asset allocation Investors need growth to fund their retirement. That means investing in equities early on. But as retirement approaches, the investment horizon shortens, and investors become more risk averse. Dynamic RetirementEdge Income Portfolios recognize this evolution in an investor s needs and, over time, automatically adjust the asset allocation of the Portfolio to a more conservative approach with greater fixed-income exposure. For the Current Pay Note, the initial asset allocation of the Fund Portfolio will be 65% equity and 35% fixed income. On each Annual Rebalancing Date, the allocation to the Equity Component will be systematically decreased, while the allocation to the Fixed Income Component will be systematically increased. In year 20, the target allocation to the Equity Component will be 27% and the target allocation to the Fixed Income Component will be 73%. 80% 60% 40% 20% Automatic asset allocation (Current Pay Note) Fixed income Equities 0% Start Year 5 Year 10 Year 15 Year 20 For the Deferred 5 Notes, the allocation would keep getting rebalanced until year 25, where the target to the Equity Component will be 22% and the target allocation to the Fixed Income Component will be 78%. 80% 60% 40% Automatic asset allocation (Deferred 5 Note) Fixed income Equities 20% 0% Start Year 5 Year 10 Year 15 Year 20 Year 25 *If an Extraordinary Event occurs, the Fund Portfolio will be replaced with Notional Fixed Annuities that will continue to make payments until maturity of the Notes. For further information on Extraordinary Events, please refer to the Information Statement. 4

4 > Reliable cash flow By investing in a diversified portfolio of Dynamic funds, and by guaranteeing steady cash flow, the Notes offer the growth potential from equities with the comfort of reliable cash flow. > Tax efficiency Bank of Montreal Dynamic RetirementEdge Income Portfolios include built-in tax efficiencies that offer investors the potential to defer taxes up to 20 years with the Current Pay Notes or up to 25 years with the Deferred 5 Notes. Investors in the Current Pay Notes will receive monthly principal repayment of $ per Deposit Note (4% of the deposit amount per annum). The monthly payments will continue for 20 years, regardless of market conditions or the performance of the Fund Portfolio. Investors in the Deferred 5 Notes will receive monthly principal repayment of $ per Deposit Note (5% of the deposit amount per annum). The monthly payments will start in year 6 and will continue for 20 years, regardless of market conditions or the performance of the Fund Portfolio. 5

5 > Terms of Deposit Notes (Series 11 & 12) Issuer: Bank of Montreal Selling Period: Until July 24, 2009 Minimum Investment: $2,000 Fees: Maximum of 2.80% per annum Liquidity: The Deposit Notes are tradeable in a daily secondary market, which BMO Capital Markets has undertaken to use reasonable efforts to provide Maturity: Current Pay: July 27, 2029 Deferred 5: July 28, 2034 Early Trading Charge (ETC): An Early Trading Charge equal to a percentage of the Deposit Amount set out below will be applied to secondary market disposition orders If redeemed within Deposit Note Thereafter JHN % 1.08% 0.70% 0.35% nil nil nil nil nil nil nil nil nil JHN % 1.45% 1.08% 0.70% 0.35% nil nil nil nil nil nil nil nil JHN % 1.83% 1.45% 1.08% 0.70% 0.35% nil nil nil nil nil nil nil JHN % 2.20% 1.83% 1.45% 1.08% 0.70% 0.35% nil nil nil nil nil nil JHN % 2.58% 2.20% 1.83% 1.45% 1.08% 0.70% 0.35% nil nil nil nil nil JHN % 2.95% 2.58% 2.20% 1.83% 1.45% 1.08% 0.70% 0.35% nil nil nil nil JHN % 3.70% 2.95% 2.58% 2.20% 1.83% 1.45% 1.08% 0.70% 0.35% nil nil nil JHN 485 nil nil nil nil nil nil nil nil nil nil nil nil nil JHN % nil nil nil nil nil nil nil nil nil nil nil nil JHN % 0.48% nil nil nil nil nil nil nil nil nil nil nil JHN % 0.95% 0.48% nil nil nil nil nil nil nil nil nil nil JHN % 1.45% 0.95% 0.48% nil nil nil nil nil nil nil nil nil JHN % 5.20% 4.45% 3.70% 2.95% 2.58% 2.20% 1.83% 1.45% 1.08% 0.70% 0.35% nil JHN % 5.20% 4.45% 3.70% 2.95% 2.58% 2.20% 1.83% 1.45% 1.08% 0.70% 0.35% nil You should make a decision to invest in the Deposit Notes after carefully considering, with your advisor, the suitability of this investment in light of your investment objectives, investment constraints and the information in the Information Statement. Please consult with your tax advisor regarding possible tax consequences of an investment in the Deposit Notes, and your particular tax consequences when disposing of the Deposit Notes prior to maturity. 6

6 One ticket financial planning. Head Office Dundee Place 1 Adelaide St. E., Ste Toronto, ON M5C 2V9 Toll free: Tel: DWD020_2174_A_EN_V4_0609 MOE777 Investments in the Bank of Montreal Dynamic RetirementEdge Income Portfolios are not mutual fund investments. They are investments in principle protected deposit notes (Deposit Notes) issued by Bank of Montreal and constitute direct, unconditional obligations of Bank of Montreal. Details regarding the calculations and payments of interest, the notional fund portfolio (Fund Portfolio), repayment of principal and certain risk factors are contained in the Information Statements, which can be obtained through This summary is issued for information purposes only to provide an overview of the Deposit Notes and does not constitute investment advice or an offer to sell or a solicitation to purchase. The Fund Portfolio is comprised of notional investments only, meaning that investors will not have any direct or indirect ownership interest in any of the underlying reference assets in the Fund Portfolio. Changes in the value of the Fund Portfolio will directly impact the return, if any, payable on the Deposit Notes at maturity. It is possible that no return will be paid on the Deposit Notes. Sales prior to maturity may be subject to an early trading charge. Bank of Montreal makes no assurances, representations or warranties with respect to the accuracy, reliability or completeness of information contained herein. Furthermore, Bank of Montreal makes no recommendation concerning Dynamic, the Fund Portfolio or the suitability of investing in securities generally or the Deposit Notes in particular. No person has been authorized to give any information or to make any representation not contained in the Information Statements relating to the Deposit Notes and Bank of Montreal does not accept responsibility for any information not contained in the Information Statement. Unlike conventional bank deposits, the Deposit Notes are not insured under Canada Deposit Insurance Corporation Act or any other deposit insurance regime designed to ensure that depositors receive payment of all or a portion of their deposits if the deposit taking Financial institution become insolvent. BMO Capital Markets is a trademark of Bank of Montreal used under license. RetirementEdge Income Portfolio, Current Pay Notes and Deferred 5 Notes are trademarks of BMO Nesbitt Burns Corporation Limited used under license. Dynamic Funds and the Dynamic logo are registered trademarks of Dundee Corporation.