CI Canadian Investment Corporate Class

Transcription

1 Management Report of Fund Performance for the year ended March 31, 217 This annual management report of fund performance contains financial highlights but does not contain the complete annual financial statements of the investment fund. You can get a copy of the annual financial statements at your request, and at no cost, by calling , by writing to us at CI Investments Inc., 2 Queen Street East, Twentieth Floor, Toronto, ON, M5C 3G7 or by visiting our website at or SEDAR at Securityholders may also contact us using one of these methods to request a copy of the investment fund s proxy voting policies and procedures, proxy voting disclosure record, or quarterly portfolio disclosure. INVESTMENT OBJECTIVE AND STRATEGIES The objective of the CI Canadian Investment Corporate Class (the Fund ) is to obtain maximum long-term capital growth by investing, directly or indirectly, primarily in shares of major Canadian corporations. To meet the objectives of the Fund, the portfolio advisor invests primarily in the securities of the largest companies (by capitalization) listed on the Toronto Stock Exchange, manages the Fund in a disciplined value style, focusing on companies that are considered to be undervalued in relation to their future prospects and offer good absolute and relative value as characterized by measures such as lower-than-average price/book and price/earnings, and higher-thanaverage dividend yield. The portfolio advisor applies a disciplined, bottom-up stock selection process to evaluate a company s current position and future prospects. The portfolio advisor may also choose to invest up to 49% of the Fund s assets in foreign securities. The Fund may use derivatives, but only as permitted by securities regulations. In order to earn additional income, the Fund may also enter into securities lending transactions, repurchase transactions and reverse repurchase transactions, to the extent permitted by securities regulations. RISK There were no changes to the Fund over the period of this report that materially affected the overall level of risk associated with the Fund. The Fund is suitable for investors who want a core Canadian equity fund in their portfolios, are investing for the medium and/or long term and can tolerate medium risk. RESULTS OF OPERATIONS The net asset value of the Fund decreased by $341.2 million to $482.7 million from March 31, 216 to March 31, 217. The Fund had net redemptions of $435.1 million during the year. The portfolio s performance increased assets by $119. million. The Fund paid distributions totalling $25.1 million. The one-year return for Class A shares was 16.%, Class AT5 shares was 16.%, Class AT6 shares was 15.9%, Class AT8 shares was 15.8%, Class D shares was 16.4%, Class E shares was 16.1%, Class ET5 shares was 15.9%, Class ET8 shares was 16.%, Class EF shares was 17.3%, Class EFT5 shares was 17.2%, Class EFT8 shares was 17.1%, Class F shares was 17.2%, Class FT5 shares was 17.%, Class FT8 shares was 17.%, Class I shares was 18.8%, Class IT8 shares was 18.6%, Class O shares was 18.6%, Class OT5 shares was 18.4% and Class OT8 shares was 18.4%, as compared to the return of its benchmark of 18.6%. The benchmark is the S&P/TSX Composite Total Return Index. The S&P/TSX Composite Index experienced a double-digit percentage increase thanks to a broad-based recovery across multiple sectors. Financials, which stand to benefit from higher bond yields, contributed the most to the S&P/TSX Composite Index s advance. The energy sector benefitted from a tighter supply-demand dynamic in energy markets, helped by cooperation among Organization of the Petroleum Exporting Countries (OPEC) members to curtail production. Gold shares rallied strongly off low levels, though they gave back some of their gains as the year progressed. The U.S. economy showed continued signs of expansion after the surprise election of Donald Trump, whose platform promised less regulation, lower taxes and increased infrastructure spending. These factors contributed to a sharp rise in economically-sensitive equities after the November vote was cast. Conversely, defensive bond proxy sectors, which had benefitted from low inflation expectations, gave back some of their gains. The Fund, which employs a value-oriented approach to stock selection, benefitted from the shift in market dynamics. Over the twelve-month period, the Fund rose in-line with the benchmark, initially lagging the golddriven rally but eventually catching up as our value approach found favour in both Canada and the U.S. Stock selection within the Canadian market was positive, leading to outperformance in sectors such as utilities, consumer staples and industrials. Examples include Brookfield Infrastructure Partners, Premium Brands Holdings Corp., and Air Canada. Conversely, an underweight allocation to gold and base metals stocks caused the materials sector to act as a drag, while stock selection within the information technology sector for example DH Corp. detracted. The Fund s holdings in financials and energy were largely neutral vis-à-vis the benchmark, though they contributed meaningfully to results as measured in absolute returns. Banks such as Royal Bank of Canada performed strongly, while insurer Intact Financial, a defensive financial that is less linked to economic activity, did not keep up with the market. Within energy, larger well-financed producers such as Canadian Natural Resources Ltd. and Suncor Energy Inc. contributed positively, while Crescent Point Energy Corp., which disappointed the market with an equity raise, detracted. The Fund s relatively small cash allocation detracted from results given the market s rise. The Fund s U.S. allocation contributed positively in an environment that favoured our value approach. Noteworthy additions included MacDonald Dettwiler & Associates Ltd., Premium Brands Holdings Corp., and Great-West Lifeco Inc. Holdings sold during the quarter included Transcanada Corp., Power Corp., Thomson Reuters Corp., Crescent Point Energy Corp., Westjet Airlines Ltd. and BRP Inc. CIG - 237

2 Management Report of Fund Performance for the year ended March 31, 217 RECENT DEVELOPMENTS We continue to research and buy positions in idiosyncratic stocks that we believe will generate value over time. Valuations have expanded and we have taken advantage of the strength in the market to exit or trim some of the Fund s holdings and will continue doing so as prices approach our valuation targets. As a result, the cash balance in the Fund is higher than normal, though still in the single-digit percent range. With U.S. inflation hitting the U.S. Federal Reserve 2% target for the first time in five years, we anticipate that interest rates will rise, which will benefit the Fund s interest-sensitive holdings including financials. Oil price volatility has re-affirmed our focus on investing in strong cash flow generating companies which can remain profitable and create value in a low oil environment. The Trump administration s economic platform and proposals are likely to cause uncertainty in the markets. Proposals including deregulation, tax cuts and infrastructure spending have the potential to be catalysts for growth and have positive impacts on several sectors within the market. Conversely, the potential for instability and implementation of protectionist trade policies could negatively impact the markets. Geopolitical risk is elevated; hence our focus on companies with an ability to ride out any storms thanks to strong economic moats and positive fundamentals. We have identified a number of such companies and are prepared to deploy capital into them opportunistically. Effective January 3, 217, James Werry became a member of the Independent Review Committee of the Fund. RELATED PARTY TRANSACTIONS Manager, Portfolio Advisor and Registrar CI Investments Inc. is the Manager, Portfolio Advisor and Registrar of the Fund. CI Investments Inc. is a subsidiary of CI Financial Corp. The Manager, in consideration for management fees, provides management services required in the day-to-day operations of the Fund. The Manager bears all of the operating expenses of the Fund (other than taxes, borrowing costs and new governmental fees) in return for a fixed administration fee. Management fee and fixed administration fee rates as at March 31, 217, for each of the classes are shown below: Annual management fee rate (%) Annual fixed administration fee rate (%) A Shares AT5 Shares AT6 Shares AT8 Shares D Shares E Shares EF Shares EFT5 Shares Annual management fee rate (%) Annual fixed administration fee rate (%) EFT8 Shares ET5 Shares ET8 Shares F Shares 1..2 FT5 Shares 1..2 FT8 Shares 1..2 I Shares Paid directly by investor - IT5 Shares Paid directly by investor - IT8 Shares Paid directly by investor - O Shares Paid directly by investor.15 OT5 Shares Paid directly by investor.15 OT8 Shares Paid directly by investor.15 The Manager received $12.4 million in management fees and $1.3 million in fixed administrative fees for the year. Management Fees Approximately 26% of total management fees were used to pay for sales and trailing commissions. The remaining 74% of management fees were used for investment management and other general administration. Independent Review Committee The Fund received standing instructions from the Board of Governors ( BoG ) in its capacity as the Independent Review Committee ( IRC ) with respect to the following Related Party Transactions: a) trades in securities of CI Financial Corp.; b) purchases or sales of securities of an issuer from or to another investment fund managed by the Manager (referred to as Inter-Fund Trades ); c) purchases or sales of other investment funds managed by the Manager or their affiliates; and d) mergers of funds with another fund that is subject to National Instrument 81-2 ( Fund Mergers ). The applicable standing instructions require that Related Party Transactions be conducted in accordance with the Manager s policies and procedures. The Manager is required to advise the IRC of any material breach of a condition of the standing instructions. The standing instructions require, among other things, that the investment decisions in respect to Related Party Transactions (a) are made by the Manager free from any influence by any entities related to the Manager and without taking into account any consideration to any affiliate of the Manager; (b) represent the business judgment of the Manager uninfluenced by considerations other than the best interests of the Fund;

3 Management Report of Fund Performance for the year ended March 31, 217 and (c) are made in compliance with the Manager s policies and procedures. Transactions made by the Manager under the standing instructions are subsequently reviewed by the IRC on a quarterly basis to monitor compliance. The Fund relied on the IRC s standing instructions regarding Related Party Transactions during this reporting year. 3

4 Management Report of Fund Performance for the year ended March 31, 217 FINANCIAL HIGHLIGHTS The following tables show selected key financial information about the Fund and are intended to help you understand the Fund s financial performance for the past five years, as applicable. A Shares Commencement of operations July 15, 23 Year Ended Year Ended Year Ended Year Ended Year Ended Yea Mar. 31, 217 Mar. 31, 216 Mar. 31, 215 Mar. 31, 214 Mar. 31, 213^ Mar (.54) (.51) (.54) (.48) (.4) (.7) (.54) (2.63) (1.56) (.19) (.16) (.17) (.33) (.12) (.97) (.84) (.7) - - (1.16) (1.) (.87) (.33) (.12) , , ,5 998, ,6 7,981 39,216 42,286 45,81 5, AT5 Shares Commencement of operations October 11, 27 Year Ended Year Ended Year Ended Year Ended Year Ended Yea Mar. 31, 217 Mar. 31, 216 Mar. 31, 215 Mar. 31, 214 Mar. 31, 213^ Mar (.19) (.18) (.21) (.19) (.17) (.4) (.67) (.98) (.56) (.6) (.6) (.6) (.13) (.5) (.33) (.3) (.26) - - (.38) (.42) (.43) (.38) (.36) (.77) (.78) (.75) (.51) (.41) ,961 2,126 2,985 3,742 3, ^Historical figures are based on Canadian GAAP, for more details refer to footnote 7.

5 Management Report of Fund Performance for the year ended March 31, 217 AT6 Shares Commencement of operations September 9, 212 Period from Year Ended Year Ended Year Ended Year Ended Inception to Mar. 31, 217 Mar. 31, 216 Mar. 31, 215 Mar. 31, 214 Mar. 31, 213^ (.25) (.25) (.28) (.27) (.13) (.68) (1.38) (.85) (.8) (.8) (.9) (.18) (.7) (.43) (.4) (.35) - - (.61) (.68) (.7) (.63) (.37) (1.12) (1.16) (1.14) (.81) (.44) AT8 Shares Commencement of operations October 23, 27 Year Ended Year Ended Year Ended Year Ended Year Ended Yea Mar. 31, 217 Mar. 31, 216 Mar. 31, 215 Mar. 31, 214 Mar. 31, 213^ Mar (.14) (.14) (.17) (.16) (.15) (.4) (.57) (.78) (.45) (.5) (.4) (.5) (.11) (.4) (.25) (.23) (.21) - - (.47) (.54) (.57) (.51) (.5) (.77) (.81) (.83) (.62) (.54) ,512 7,796,452 11,539 9,878 1,166 1,418 1,546 1,598 1, ^Historical figures are based on Canadian GAAP, for more details refer to footnote 7.

6 Management Report of Fund Performance for the year ended March 31, 217 D Shares Commencement of operations September 9, 212 Period from Year Ended Year Ended Year Ended Year Ended Inception to Mar. 31, 217 Mar. 31, 216 Mar. 31, 215 Mar. 31, 214 Mar. 31, 213^ (.28) (.26) (.28) (.24) (.12) (1.22) (1.6) (.91) (.11) (.) (.) (.19) (.7) (.58) (.5) (.41) - - (.69) (.6) (.51) (.19) (.7) ,118 1,345 1, E Shares Commencement of operations October 4, 211 Per Year Ended Year Ended Year Ended Year Ended Year Ended Ince Mar. 31, 217 Mar. 31, 216 Mar. 31, 215 Mar. 31, 214 Mar. 31, 213^ Mar (.34) (.32) (.34) (.31) (.26) (1.39) (1.89) (1.18) (.12) (.11) (.11) (.21) (.8) (.63) (.55) (.45) - - (.75) (.66) (.56) (.21) (.8) ,61 3,955 4,966 3,717 1, ^Historical figures are based on Canadian GAAP, for more details refer to footnote 7.

7 Management Report of Fund Performance for the year ended March 31, 217 EF Shares Commencement of operations December 5, 214 Period from Year Ended Year Ended Inception to Mar. 31, 217 Mar. 31, 216 Mar. 31, 215 $ $ $ (.14) (.12) (.4) (1.7) (1.11) (.61) (.9) (.7) (.8) (.44) (.38) (.31) (.53) (.45) (.39) ,174 1, EFT5 Shares Commencement of operations July 29, 215 Period from Year Ended Inception to Mar. 31, 217 Mar. 31, 216 $ $ (.13) (.8) (1.) (.71) 1.47 (.54) - - (.8) (.7) (.41) (.37) (.47) (.32) (.96) (.76)

8 Management Report of Fund Performance for the year ended March 31, 217 EFT8 Shares Commencement of operations July 29, 215 Period from Year Ended Inception to Mar. 31, 217 Mar. 31, 216 $ $ (.13) (.7) (.96) (.71) 1.42 (.53) - - (.8) (.7) (.39) (.36) (.73) (.52) (1.2) (.95) ET5 Shares Commencement of operations December 29, 215 Period from Year Ended Inception to Mar. 31, 217 Mar. 31, 216 $ $ (.31) (.7) (2.8) (.22) (.) (.9) (.52) (.48) (.61) (.15) (1.23) (.72) The Fund had no Class ET5 shares outstanding as at March 31,

9 Management Report of Fund Performance for the year ended March 31, 217 ET8 Shares Commencement of operations October 4, 211 Per Year Ended Year Ended Year Ended Year Ended Year Ended Ince Mar. 31, 217 Mar. 31, 216 Mar. 31, 215 Mar. 31, 214 Mar. 31, 213^ Mar (.23) (.24) (.27) (.27) (.24) (.96) (1.29) (.78) (.8) (.7) (.8) (.18) (.7) (.4) (.38) (.34) - - (.77) (.88) (.93) (.84) (.82) (1.25) (1.33) (1.35) (1.2) (.89) F Shares Commencement of operations July 15, 23 Year Ended Year Ended Year Ended Year Ended Year Ended Yea Mar. 31, 217 Mar. 31, 216 Mar. 31, 215 Mar. 31, 214 Mar. 31, 213^ Mar (.37) (.32) (.34) (.3) (.25) (.12) (2.52) (2.96) (1.46) (.22) (.19) (.19) (.37) (.13) (1.12) (.97) (.79) - - (1.34) (1.16) (.98) (.37) (.13) ,667 5,696 7,291 6,941 6, ^Historical figures are based on Canadian GAAP, for more details refer to footnote 7. 9

10 Management Report of Fund Performance for the year ended March 31, 217 FT5 Shares Commencement of operations February 8, 28 Year Ended Year Ended Year Ended Year Ended Year Ended Yea Mar. 31, 217 Mar. 31, 216 Mar. 31, 215 Mar. 31, 214 Mar. 31, 213^ Mar (.14) (.13) (.14) (.13) (.11) (.8) (1.97) (1.22) (.78) (.8) (.7) (.8) (.15) (.6) (.4) (.36) (.31) - - (.46) (.5) (.51) (.44) (.41) (.94) (.93) (.9) (.59) (.47) FT8 Shares Commencement of operations October 24, 211 Peri Year Ended Year Ended Year Ended Year Ended Year Ended Ince Mar. 31, 217 Mar. 31, 216 Mar. 31, 215 Mar. 31, 214 Mar. 31, 213^ Mar (.) (.9) (.) (.9) (.9) (.3) (1.) (.82) (.42) (.5) (.5) (.6) (.12) (.5) (.27) (.25) (.23) - - (.51) (.58) (.61) (.54) (.53) (.83) (.88) (.9) (.66) (.58) ^Historical figures are based on Canadian GAAP, for more details refer to footnote 7.

11 Management Report of Fund Performance for the year ended March 31, 217 I Shares Commencement of operations January 24, 26 Year Ended Year Ended Year Ended Year Ended Year Ended Yea Mar. 31, 217 Mar. 31, 216 Mar. 31, 215 Mar. 31, 214 Mar. 31, 213^ Mar (.3) (.9) (.53) (2.5) (.84) (.15) (.13) (.13) (.24) (.9) (.78) (.66) (.53) - - (.93) (.79) (.66) (.24) (.9) ,12 6,316 7,47 7,2 7,792 15, IT5 Shares Commencement of operations April 3, 213 Period from Year Ended Year Ended Year Ended Inception to Mar. 31, 217** Mar. 31, 216 Mar. 31, 215 Mar. 31, 214 $ $ $ $ (1.16) (.47) (.7) (.8) (.15) - (.37) (.32) - (.4) (.51) (.51) (.44) (.4) (.95) (.91) (.59) **The Fund had no Class IT5 shares outstanding as at March 31, 217. ^Historical figures are based on Canadian GAAP, for more details refer to footnote 7.

12 Management Report of Fund Performance for the year ended March 31, 217 IT8 Shares Commencement of operations July 3, 28 Year Ended Year Ended Year Ended Year Ended Year Ended Yea Mar. 31, 217 Mar. 31, 216 Mar. 31, 215 Mar. 31, 214 Mar. 31, 213^ Mar (.2) (.4) (.88) (.99) (.38) (.7) (.6) (.7) (.14) (.6) (.35) (.32) (.28) - - (.65) (.72) (.75) (.66) (.63) (1.7) (1.) (1.) (.8) (.69) O Shares Commencement of operations October 4, 211 Peri Year Ended Year Ended Year Ended Year Ended Year Ended Ince Mar. 31, 217 Mar. 31, 216 Mar. 31, 215 Mar. 31, 214 Mar. 31, 213^ Mar (.6) (.3) (.3) (.2) (.2) (.1) (1.42) (1.73) (.68) (.14) (.12) (.12) (.22) (.8) (.71) (.6) (.49) - - (.85) (.72) (.61) (.22) (.8) ,819 15,354 13,29 9,668 5, , ^Historical figures are based on Canadian GAAP, for more details refer to footnote 7.

13 Management Report of Fund Performance for the year ended March 31, 217 OT5 Shares Commencement of operations October 4, 211 Peri Year Ended Year Ended Year Ended Year Ended Year Ended Ince Mar. 31, 217 Mar. 31, 216 Mar. 31, 215 Mar. 31, 214 Mar. 31, 213^ Mar (.4) (.2) (.2) (.2) (.2) (.45) (1.32) (.28) (.41) (.11) (.9) (.) (.2) (.8) (.54) (.49) (.41) - - (.62) (.66) (.66) (.57) (.53) (1.27) (1.24) (1.17) (.77) (.61) OT8 Shares Commencement of operations October 4, 211 Peri Year Ended Year Ended Year Ended Year Ended Year Ended Ince Mar. 31, 217 Mar. 31, 216 Mar. 31, 215 Mar. 31, 214 Mar. 31, 213^ Mar (.4) (.2) (.2) (.2) (.2) (.93) (1.57) (.66) (.9) (.8) (.9) (.19) (.7) (.46) (.42) (.37) - - (.86) (.95) (.99) (.88) (.83) (1.41) (1.45) (1.45) (1.7) (.9) ^Historical figures are based on Canadian GAAP, for more details refer to footnote 7.

14 Management Report of Fund Performance for the year ended March 31, 217 (1) This information is derived from the Fund s audited annual financial statements. (2) Net assets per share and dividends per share are based on the actual number of shares outstanding for the relevant class at the relevant time. The increase (decrease) in net assets from operations per share is based on the weighted average number of shares outstanding for the relevant class over the fiscal year. (3) Dividends are automatically reinvested in additional shares of the Fund. (4) Management expense ratio is calculated based on expenses charged to the Fund (excluding commissions and other portfolio transaction costs) and is expressed as an annualized percentage of daily average net assets for the year. The Effective HST tax rate is calculated using the attribution percentage for each province based on shareholder residency and can be different from 13%. (5) The Fund s portfolio turnover rate indicates how actively the Fund s portfolio advisor manages its portfolio investments. A portfolio turnover rate of % is equivalent to the Fund buying and selling all of the securities in its portfolio once in the course of the fiscal year. The higher a Fund s portfolio turnover rate in a year, the greater the trading costs payable by the Fund in the year, and the greater the chance of an investor receiving taxable capital gains in the year. There is not necessarily a relationship between a higher turnover rate and the performance of a Fund. Portfolio turnover rate is calculated by dividing the lesser of the cost of purchases and the proceeds of sales of portfolio securities for the year, and excluding cash and short-term investments maturing in less than one year, and before assets acquired from a merger, if applicable, by the average of the monthly fair value of investments during the year. (6) The trading expense ratio represents total commissions and other portfolio transaction costs disclosed in the statements of comprehensive income expressed as an annualized percentage of daily average net assets of the Fund during the year. (7) For financial years beginning on or after April 1, 213 the financial highlights are derived from the financial statements prepared in accordance with International Financial Reporting Standards (IFRS). IFRS allows net assets to be calculated based on the last traded market price for financial assets and financial liabilities where the last traded price falls within the day s bid-ask spread. There are no differences between the net assets calculated for purpose of processing shareholders transactions and the net assets attributable to holders of redeemable shares used for financial statement reporting purposes. For financial years before April 1, 213, the financial highlights are derived from the financial statements prepared in accordance with Canadian GAAP. Under Canadian GAAP net assets for financial statement purposes were calculated based on bid/ask price while for purpose of processing shareholder transactions net assets were calculated based on the closing market price. (8) This information is provided as at March 31 of the years shown.

15 Management Report of Fund Performance for the year ended March 31, 217 PAST PERFORMANCE This section describes how the Fund has performed in the past. Remember, past returns do not indicate how the Fund will perform in the future. The information shown assumes that dividends made by the Fund in the years shown were reinvested in additional shares of the relevant classes of the Fund. In addition, the information does not take into account sales, redemption, distribution or other optional charges that would have reduced returns or performance. Year-by-Year Returns The following charts show the Fund s annual performance for each of the years shown and illustrate how the Fund s performance has changed from year to year. In percentage terms, the charts show how much an investment made on the first day of each financial year would have grown or decreased by the last day of each financial year, except where noted. A Shares AT5 Shares AT6 Shares AT8 Shares Mar. 212 Mar Mar Mar Mar. 28 Mar. 29 Mar. 2 Mar. 211 Mar. 212 Mar. 213 Mar. 214 Mar. 215 Mar. 213 Mar. 214 Mar. 215 Mar. 212 Mar. 213 Mar. 214 Mar. 215 Mar. 28 Mar. 29 Mar. 2 Mar. 211 Mar. 212 Mar. 213 Mar. 214 Mar. 215 Mar. 28 Mar. 29 Mar. 2 Mar. 211 Mar. 212 Mar. 213 Mar. 214 Mar. 215 Mar. 213 Mar. 214 Mar. 215 Mar. 28 Mar. 29 Mar. 2 Mar. 211 Mar. 212 Mar. 213 Mar. 214 Mar. 215 D Shares E Shares EF Shares EFT5 Shares ET5 Shares EFT8 Shares ET8 Shares F Shares Mar

16 Management Report of Fund Performance for the year ended March 31, 217 FT5 Shares FT8 Shares I Shares IT8 Shares Mar. 28 Mar. 29 Mar Mar. 211 Mar. 212 Mar. 213 Mar. 214 Mar O Shares OT5 Shares OT8 Shares Mar. 212 Mar. 213 Mar. 214 Mar. 215 Mar. 212 Mar. 213 Mar. 214 Mar. 215 Mar. 212 Mar. 213 Mar. 214 Mar. 215 Mar. 28 Mar. 29 Mar. 2 Mar. 211 Mar Mar. 213 Mar Mar Mar. 29 Mar. 2 Mar. 211 Mar. 212 Mar. 213 Mar. 214 Mar. 215 Mar. 212 Mar. 213 Mar. 214 Mar This figure is for the period from October 11, 27 to March 31, This figure is for the period from February 8, 28 to March 31, This figure is for the period from July 3, 28 to March 31, This figure is for the period from October 4, 211 to March 31, This figure is for the period from October 24, 211 to March 31, This figure is for the period from September 9, 212 to March 31, This figure is for the period from April 3, 213 to March 31, This figure is for the period from December 5, 214 to March 31, This figure is for the period from October 23, 27 to March 31, 28. This figure is for the period from July 29, 215 to March 31, This figure is for the period from December 29, 215 to March 31, 216.

17 Management Report of Fund Performance for the year ended March 31, 217 Annual Compound Returns The following table shows the Fund s annual compound returns for each year indicated, compared to the S&P/TSX Composite Total Return Index. The S&P/TSX Composite Total Return Index is a float-adjusted market capitalization weighted index which is the principal broad measure of the Canadian equity market. It includes common stocks and income trust units of companies incorporated in Canada which are listed on the Toronto Stock Exchange. A discussion of the performance of the Fund as compared to the benchmark is found in the Results of Operations section of this report. One Year (%) Three Years (%) Five Years (%) Ten Years (%) Since Inception (%) A Shares n/a S&P/TSX Composite Total Return Index n/a AT5 Shares n/a 3.8 S&P/TSX Composite Total Return Index n/a 3.7 AT6 Shares n/a n/a 9.5 S&P/TSX Composite Total Return Index n/a n/a 9.2 AT8 Shares n/a 4.1 S&P/TSX Composite Total Return Index n/a 3.7 D Shares n/a n/a 9.9 S&P/TSX Composite Total Return Index n/a n/a 8.5 E Shares n/a. S&P/TSX Composite Total Return Index n/a 7.7 EF Shares 17.3 n/a n/a n/a 5.6 S&P/TSX Composite Total Return Index 18.6 n/a n/a n/a 5.5 EFT5 Shares 17.2 n/a n/a n/a 6.2 S&P/TSX Composite Total Return Index 18.6 n/a n/a n/a 7.6 EFT8 Shares 17.1 n/a n/a n/a 6.1 S&P/TSX Composite Total Return Index 18.6 n/a n/a n/a 7.6 ET5 Shares 15.9 n/a n/a n/a 9.8 S&P/TSX Composite Total Return Index 18.6 n/a n/a n/a 8.6 ET8 Shares n/a 9.8 S&P/TSX Composite Total Return Index n/a 8.6 F Shares n/a S&P/TSX Composite Total Return Index n/a FT5 Shares n/a 5.9 S&P/TSX Composite Total Return Index n/a 4.6 FT8 Shares n/a 3.7 S&P/TSX Composite Total Return Index n/a 7.7 I Shares n/a S&P/TSX Composite Total Return Index n/a IT8 Shares n/a 7.6 S&P/TSX Composite Total Return Index n/a 3.7 O Shares n/a 12.4 S&P/TSX Composite Total Return Index n/a 7.7 OT5 Shares n/a 12.3 S&P/TSX Composite Total Return Index n/a 8.6 OT8 Shares n/a 12.3 S&P/TSX Composite Total Return Index n/a

18 Management Report of Fund Performance for the year ended March 31, 217 Summary of Investment Portfolio as at March 31, 217 Portfolio Breakdown Percentage of Portfolio Breakdown (cont d) Percentage of Top 25 Holdings Percentage of Category Net Assets (%) Category Net Assets (%) Security Name Net Assets (%) Country allocation Canada U.S.A Cash & Equivalents Japan Netherlands Antilles Ireland Bermuda U.K Switzerland Germany....9 Other Net Assets (Liabilities)....8 France....8 Netherlands....5 Jersey Island....4 Mexico....2 Foreign Currency Forward Contracts....2 Denmark....2 India....2 Thailand....2 Hong Kong....2 Cayman Islands....1 Sweden....1 South Korea....1 Israel....1 Russia....1 Luxembourg....1 Sector allocation Financials Energy Industrials Consumer Discretionary Information Technology Health Care Materials Consumer Staples Cash & Equivalents Real Estate Utilities Other Net Assets (Liabilities)....8 Telecommunication Services....5 Corporate Bonds....4 Foreign Currency Forward Contracts....2 Private Placements.... Royal Bank of Canada Cash & Equivalents The Bank of Nova Scotia Toronto-Dominion Bank CCL Industries Inc., Class B Enbridge Inc Manulife Financial Corp Canadian National Railway Co Suncor Energy Inc Keyera Corp Canadian Imperial Bank of Commerce Alphabet Inc., Class C Air Canada CGI Group Inc Canadian Natural Resources Ltd Microsoft Corp Schlumberger Ltd EOG Resources Inc Magna International Inc., Class A Premium Brands Holdings Corp Wells Fargo & Co Citigroup Inc Johnson & Johnson Dow Chemical Co Brookfield Infrastructure Partners L.P Total Net Assets (in $ s) $482,721 The summary of investment portfolio may change due to ongoing portfolio transactions of the Fund and updates will be available on a quarterly basis. A NOTE ON FORWARD-LOOKING STATEMENTS This report may contain forward-looking statements about the Fund, its future performance, strategies or prospects, and possible future Fund action. The words may, could, should, would, suspect, outlook, believe, plan, anticipate, estimate, expect, intend, forecast, objective, and similar expressions are intended to identify forward-looking statements. Forward-looking statements are not guarantees of future performance. Forward-looking statements involve inherent risks and uncertainties, both about the Fund and general economic factors, so it is possible that predictions, forecasts, projections and other forward-looking statements will not be achieved. We caution you not to place undue reliance on these statements as a number of important factors could cause actual events or results to differ materially from those expressed or implied in any forward-looking statement made by the Fund. These factors include, but are not limited to, general economic, political and market factors in Canada, the United States and internationally, interest and foreign exchanges rates, global equity and capital markets, business competition, technological changes, changes in laws and regulations, judicial or regulatory judgments, legal proceedings and catastrophic events. The above list of important factors that may affect future results is not exhaustive. Before making any investment decisions, we encourage you to consider these and other factors carefully. All opinions contained in forward-looking statements are subject to change without notice and are provided in good faith but without legal responsibility.