CI Portfolios. Portfolio Review First Quarter 2018 ivari CI Growth Portfolio

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1 CI Portfolios Portfolio Review First Quarter 2018 ivari CI Growth Portfolio

2 Portfolio Performance ivari CI Portfolios are available as Guaranteed Investment Portfolios within select ivari segregated funds contracts and as Managed Portfolio Index Interest Options within select ivari Universal Life Products. Segregated Fund Net Returns below are for the ivari Guaranteed Investment Funds product. Please refer to for the returns on other products. 3 Month 6 Months 1 Year 3 Years 5 Years 10 Years Since Inception Inception Date -1.4% 1.4% 1.8% 2.0% 6.5% N/A 6.3% October 2009 Past results should not be construed as indicative of future performance. Actual fund performance is expected to vary. On September 21, 2012, the Transamerica TOP GIPs began investing in a new portfolio managed by CI Investments. The Transamerica TOP GIPs are now referred to as ivari CI GIPs. Asset Allocation Overview and Activity Different types of investments will respond differently to the markets, reinforcing the importance of a multi-level diversification strategy. A balanced asset mix ensures that investors are not dependent on any one asset class or security type to provide returns. This report is designed to provide you with an up-to-date portfolio overview of the ivari CI Growth Portfolio, including the allocations across asset class, geographic region, equity sector and market capitalization. The arrows indicate whether the allocation for each category has increased or decreased since the previous quarter-end. Asset Class Geographic Regions 27.8% 25.4% 13.6% 11.4% 5.9% 4.6% 4.1% 3.7% 3.5% U.S. equity Canadian equity Canadian bond European equity Cash Asian equity Foreign bond Emerging markets equity Other equity 38.9% 30.5% 13.7% 4.0% 3.5% 3.1% 2.0% 1.7% 1.4% 1.2% Canada U.S. Cash and other countries Emerging markets U.K. Japan Switzerland Bermuda Cayman Islands Ireland Equity Market Cap Equity Industry Sector 89.4% 9.5% 1.1% Large-cap Mid-cap Small-cap 24.1% 13.0% 11.4% 9.2% 8.7% 8.4% 8.3% 7.4% 4.5% 2.5% 2.4% 0.1% Financial services Information technology Industrials Consumer discretionary Energy Consumer staples Materials Health care Utilities Telecommunication services Real estate Other

3 Underlying Fund Allocations Foresters Asset Management Canadian Bond Pool 13.3% Cambridge Canadian Equity Corporate Class 12.6% Signature Select Canadian Corporate Class 7.7% Synergy Canadian Corporate Class 7.0% CI International Value Corporate Class 7.0% First Asset MSCI World Low Risk Weighted ETF 6.6% CI American Managers Corporate Class 5.5% Cambridge Global Equity Corporate Class 5.2% Signature Emerging Markets Corporate Class 4.8% CI Canadian Investment Corporate Class 4.6% CI American Value Corporate Class 4.0% CI Can-Am Small Cap Corporate Class 3.8% Harbour Voyageur Corporate Class 3.6% Harbour Corporate Class 3.5% CI American Small Companies Corporate Class 2.9% Marret Short Duration High Yield Fund 2.1% Signature Global Bond Fund 2.1% Black Creek International Equity Corporate Class 1.8% Marret High Yield Bond Fund 1.0% Cash 0.9% Top Ten Holdings Canada Gov't Bond 2.75% 01Dec48 1.3% Toronto-Dominion Bank 1.0% Royal Bank of Canada 1.0% Canadian Natural Resources Ltd. 0.9% Walgreens Boots Alliance Inc 0.9% Athene Holding Ltd. 0.9% Bank of Nova Scotia 0.8% Chubb Ltd. 0.8% Symantec Corp. 0.7% CP Railway Ltd. 0.7%

4 Portfolio Commentary The portfolio declined 1.4% during the quarter, underperforming its benchmark (30% S&P/TSX Composite Index, 20% FTSE TMX Canada Universe Bond Index, 50% MSCI World Index, C$), which fell 0.7%. The Canadian equity portion s holdings in the information technology and energy sectors made positive contributions to relative performance. The international equity portion s holdings in financials also added relative value, while U.S. equities detracted. Within the income portion, global bonds and U.S.-dollar exposure made a positive contribution to relative performance, while exposure to high-yield bonds detracted. The portfolio s overall asset allocation made a positive contribution, due largely to an underweight position in Canadian equities. Global equity markets soared in January, continuing 2017 s gains. In early February, however, market volatility resurfaced and stocks declined, as very positive U.S. economic data prompted investor concerns about rising inflation. Valuations recovered during the ensuing weeks, but markets were roiled again in late March by rising international trade tensions. The North American energy and materials sectors were among the weakest during the quarter. Information technology was a top performer, although gains achieved early in the period were reduced by later losses. The S&P/TSX Composite Index lagged global equity markets due to its heavy weightings in the resource sectors and its under-representation in sectors that outperformed, including information technology. The Canadian dollar depreciated against its U.S. counterpart, which created positive returns in foreign markets for Canadian investors after currency conversion. Central banks worldwide continued to weigh their options for scaling back monetary policies designed to stimulate the economy. Despite continuing economic growth, the Bank of Canada in early March maintained the target for its key overnight interest rate at 1.25%, citing international trade uncertainties. The U.S. Federal Reserve, under new Chairman Jerome Powell, raised its target range for the federal funds rate by one-quarter of a percentage point, based on a stronger economic outlook. This was in line with market expectations. Government bond yields rose early in the quarter, reflecting the market s optimism for continued global growth and expectations of higher interest rates. In the income portion of the portfolio, our core goals remain preserving capital and outpacing inflation over a three-year period. We focus on careful portfolio construction and asset allocation, built on a foundation of government bonds for safety and income. Interest rate sensitivity is hedged by diversifying into other asset classes, such as gold bullion, corporate bonds and stocks. Within the corporate bond portion, we maintain a short term to maturity as we near the latter stages of the economic cycle, when credit defaults could become more frequent. Our market outlook has not changed from the previous quarter, and we believe equity valuations are nearing their peaks. While we believe it is possible for corporate earnings to continue to grow, market prosperity could be threatened by macroeconomic developments in such areas as global trade, credit conditions, sovereign and household debts, and central bank policies. We will monitor these threats closely and will continue to use derivatives to help manage the risk of stock market decline. The U.S. deficit and debt expansion are significant concerns, as we believe these will weaken the U.S. dollar. We are decreasing our U.S. exposure by selling assets denominated in the greenback and increasing our hedge ratio. With correlation increasing between asset classes (equities and bonds) and declining among stock prices, true active management employing both asset allocation and security selection is more important than ever. Moreover, active management thrives during periods of high market volatility, while a passive approach is exposed to the fluctuations of the entire market. Our equity allocation is more diversified than that of the Canadian economy and the S&P/TSX Composite Index. Our largest underweight allocation relative to the index is in the financials sector and the positioning within the sector is more diversified than the benchmark. We had overweight exposure to defensive sectors, such as health care and consumer staples, and were underweight in cyclical and interest-rate-sensitive sectors, such as energy and telecommunications services. The style factor was not a meaningful contributor or detractor over the quarter. Despite our underweighting in Canada, holding domestic assets nonetheless caused some downside, as investors were focused on negative economic issues, such as high household debt, low oil prices and trade uncertainties. However, we consider this a very restrictive view of domestic equities, which we see as increasingly offering better value than other markets. We continue to look for opportunities in areas that have been out of favour and under-bought, but in which investment fundamentals remain strong. The Canadian equity portion outperformed the market. The portfolio has underweight allocations to the resources and financials sectors, and overweight positions in other areas such as utilities, information technology and consumer staples positioning that we believe enhances risk-adjusted

5 return potential. Cambridge Canadian Equity Corporate Class s U.S.-dollar exposure, overweight allocation to information technology and stock selection in energy added relative value. The U.S. equity portion underperformed the broader U.S. market. The portfolio has overweight allocations to the materials and financials sectors, and underweight positions in other areas such as consumer discretionary and health care. CI American Managers Corporate Class s holdings in consumer discretionary and information technology detracted from value. Alfred Lam, CFA, Senior Vice-President and Chief Investment Officer Yoonjai Shin, CFA, Vice-President and Portfolio Manager Marchello Holditch, CFA, Vice-President Milica Stojanovic, Associate Director Andrew Ashworth, MBA, CFA Desta Tadesse, Analyst Zoe Li, Junior Analyst Currency hedging detracted from relative performance during the quarter, after playing a positive role in 2017 when it mitigated some foreign investment losses. Nonetheless, we continue to attempt to limit the effects of exchange rate fluctuations by maintaining our long-standing, partial hedge on the portfolio. The international equity portion outperformed broader international equity markets. CI International Value Corporate Class s holdings in financials added relative value, while Black Creek International Equity Corporate Class s positions in consumer staples and industrials detracted. Currency hedging also detracted from performance as the Canadian dollar depreciated against most major currencies. An allocation to emerging markets added value over the quarter, while stock selection in Europe detracted value, largely due to Black Creek International Equity s position in Aryzta. This portion had an overweight allocation to information technology, and was underweight industrials, real estate and utilities. Geographically, we had overweight exposure to emerging markets, mainly in Asia and Latin America, and were significantly underweight Australia and Japan.

6 Portfolio management teams In the ivari CI Portfolios

7 Strength and experience The ivari CI Portfolios are managed by CI Investments Inc. on behalf of ivari Canada ULC. For more information on ivari CI Portfolios, please contact your advisor or visit To learn more about ivari please visit Any amount that is allocated to a segregated fund is invested at the risk of the contract holder(s) and may increase or decrease in value. Returns for index interest options are linked to the performance of the designated index. When you invest in an index interest option, you do not acquire an interest in the designated index or purchase any units or legal interest in any security. All indexes quoted in this document are reported on a total return basis, which assumes the reinvestment of all dividends and other cash distributions. Some indices (e.g.: MSCI EAFE Index) referenced in the included portfolio commentary may not be components of the portfolio benchmarks. Source: FTSE TMX Global Debt Capital Markets Inc FTSE TMX Global Debt Capital Markets Inc FTSE is a trade mark of FTSE International Ltd and is used under licence. TMX is a trade mark of TSX Inc. and is used under licence. All rights in the FTSE TMX Global Debt Capital Markets Inc s indices and/or FTSE TMX Global Debt Capital Markets Inc s ratings vest in FTSE TMX Global Debt Capital Markets Inc and/or its licensors. Neither FTSE TMX Global Debt Capital Markets Inc nor its licensors accept any liability for any errors or omissions in such indices and / or ratings or underlying data. No further distribution of FTSE TMX Global Debt Capital Markets Inc s data is permitted without FTSE TMX Global Debt Capital Markets Inc s express written consent. Source: MSCI. MSCI makes no express or implied warranties or representations and shall have no liability whatsoever with respect to any MSCI data contained herein. The MSCI data may not be further redistributed or used as a basis for other indexes or any securities or financial products. This report is not approved, endorsed, reviewed or produced by MSCI. None of the MSCI data is intended to constitute investment advice or a recommendation to make (or refrain from making) any kind of investment decision and may not be relied on as such. The S&P/TSX Index data ( Index ) is a product of S&P Dow Jones Indices LLC and TSX Inc. and has been licensed for use by ivari Holdings ULC. All rights reserved. S&P is a registered trademark of Standard & Poor s Financial Services LLC ( S&P ). Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC ( Dow Jones ). TSX is a registered trademark of TSX Inc. Neither S&P Dow Jones Indices LLC, S&P, Dow Jones, TSX Inc., their affiliates nor their third party licensors make any representation or warranty, express or implied, as to the ability of any index to accurately represent the asset class or market sector that it purports to represent and none such entities shall have any liability for any errors, omissions, or interruptions of any index or any data related thereto. CI Investments, the CI Investments design, Cambridge, and Harbour Advisors are registered trademarks of CI Investments Inc. TM Signature Global Asset Management, Signature Funds and CI Multi-Asset Management are trademarks of CI Investments Inc. First Asset is a trademark of FA Capital, a wholly owned subsidiary of CI Financial Corp Asset Management L.P. and the 1832 Asset Management design are trademarks of The Bank of Nova Scotia, used under licence. TM ivari and the ivari logos are trademarks of ivari Holdings ULC. ivari is licensed to use such marks. All trademarks used under licence. Published May Queen Street East, Twentieth Floor, Toronto, Ontario M5C 3G7 I Head Office / Toronto CI Managed Solutions Team _E (05/18)