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Prepared for:

<Client Name> <Client Address>

<Date>

Compliments of:

<Advisor Name>IPC Investment Corporation orIPC Securities Corporation (choose one)<Advisor Address><Advisor Phone><Advisor Email>Website: www.ipcc.ca

Personal & Confidential 2<Client Name’s> Portfolio Management Strategy prepared by <Advisor Name>

“Investing isn’t just

about making money.

It’s a way of reaching

our personal goals…”

Peter Lynch

This document has been written to provide both clarity and guidance in the investment decision-making process. Its purpose is to outline the investment process that will be applied in the management of your portfolio.

Agenda

Portfolio Management Strategy

• Background on Portfolio Construction

• Our Investment Management Philosophy

• Portfolio Composition Process

• About our Portfolio Management Service - Counsel Portfolio Services Inc.

• Investment Specialist Selection Process

• Ongoing Portfolio Monitoring Process

• Investment Specialist Replacement Process


Background On Portfolio Construction

1. Your Time Horizon – Identifies how long you will remain invested before you need access to your

investments.

2. Your Income Requirements– Depending on the investments selected, your portfolio may generate interest income,

dividend income, or a combination of both.– Depending on your needs, you can choose to reinvest the income or cash flow that is

generated, or have it paid out to you periodically.

3. Your Need for Capital Growth

– The capital growth potential of your portfolio is largely determined by its equity content.

– Historically, equities have outperformed all other investment alternatives. – Generally, the trade-off for investing in equities is experiencing short-term losses to

participate in long-term gains. If you prefer not to invest in equities, it may mean that your portfolio’s capital growth potential is limited.

– Your portfolio will be designed to fit your personal preference for growth versus risk.

There are a number of important factors that determine the investment strategythat will be used in managing your portfolio:



4. Your Risk Tolerance – Portfolio Volatility– Markets can experience periods of volatility, which may cause security prices to

fluctuate.– Long-term investors focus on longer-term trends, not temporary fluctuations. The

key is to maintain a focus on your long-term investment goals. – Your portfolio will be managed with consideration to your personal level of

preference for volatility, or risk.

5. Your Liquidity Needs– Typically, as you move closer to the end of your investment time horizon, your

portfolio will have more cash and cash equivalent securities that can be used for current income when required. Liquid cash equivalent investments may include treasury bills, money market funds, or high yield savings accounts which may be held as part of your overall portfolio.



6. Investment Styles

• Value Investing - Value investment specialists:

– analyze balance sheets and relative prices to determine a company’s worth. – invest in companies that cost less than their estimated worth, or those that are

out of favour with the market.

– can unearth ‘diamonds in the rough’, allowing your portfolio to benefit from a stock’s price appreciation in value over time.

• Growth Investing - Growth investment specialists:– look at variables such as return on equity, quarterly earnings momentum,

earnings revisions.– focus on factors such as a good performance track record, sustainable earnings

momentum, potential trend, expected earnings surprises and relative price performance.

– can pick out stocks that have visible above average growth potential, allowing your portfolio to benefit from a stock’s price appreciation as the market recognizes this potential.



7. Investment Style Diversification

• We believe that investment style diversification is an important part of portfolio construction.

• Investing in portfolios that have different styles of money management may:– reduce the overall volatility within your portfolio.– improve the potential for out-performance as you are not “betting” on a single

style.– lower risk of your portfolio being negatively impacted by a particular style being

out of favour. – allow you to benefit from any gains generated by the stock picking abilities of

investment specialists using both approaches.


Source: Morningstar Direct. Russell 1000 Growth Total Return, Russell 1000 Value Total Return indices to Nov. 2009

Growth

Value

Style Blend 50:50

Style Blend 50:50

Style Neutrality

There will be times where one style will outperform the other. A diversified

style-neutral investment strategy can reduce volatility and capture the growth

potential of each investment style.



8. Market Timing

• Predicting market changes is difficult even for the experts. Yet, many investors think they know what will happen to the markets based only on a hunch, or rumour.

• Timing the market requires two things:– knowing the right time to buy, and the right time to sell– If you miss either, you may miss the market’s gains

• Most of the market's gains occur in just a few strong, but unpredictable, trading days. To maximize the market's long-term performance, you have to be in the market during those days

Source: Counsel Portfolio Services, Morningstar Direct. (Based on the S&P/TSX Composite Total Return Index)

10 Years ended August 31, 2011 Annual Return

Staying invested 8.1%

Missing the 10 best trading days 1.7%

Missing the 30 best trading days -5.1%

Missing the 50 best trading days -9.8%


The Importance Of Proper Asset Allocation

Index Annual Performance: Canadian Bonds: DEX Universe Bond Total Return Index Global Equities: MSCI World Index ($Cdn) Canadian Large Cap: S&P/TSX Total Return Index Foreign Equities: MSCI EAFE Index ($Cdn) Canadian Small Cap: BMO Nesbitt Burns Cdn Small Cap Index US Large Cap: S&P 500 Total Return Index ($Cdn) Emerging Markets: MSCI Emerging Markets Free Index ($Cdn) US Small Cap: Russell 2000 Index ($Cdn)

Source: Globe HySales December 2010This chart has been re-produced with permission from Mackenzie Financial Corporation.

Diversifying allows you the potential to participate in winning categories each year.


The Importance Of Geographic And Market Sector Diversification

Energy and materials represent approximately 50% of the Canadian index*.These commodities usually do well in times of global expansion but when economies retract they can also decline in value.

Diversifying allows you to reduce the volatility of your overall return over time.

*Source: MSCI and S&P/TSX indices, 2008


Growth

Average 5-Yr GIC (Cash)

Investment Name

Canadian Balanced Portfolio

S&P/TSX Composite TR

MSCI World GR USD

1989 1991 1993 1995 1997 1999 2001 2003 2005 2007

63.80K

45.40K

32.40K

23.10K

16.50K

11.80K

8.40K

Source: Morningstar Direct

The Importance Of A Balanced Approach

A balanced portfolio can reduce volatility

*Source: Morningstar Direct


Diversification Through Asset Allocation

• Asset allocation is the process of apportioning investments among various asset categories.

• Approximately 91% of a portfolio’s volatility has been shown to be attributed to asset allocation*.

• Proper asset allocation can help mitigate risks and improve overall returns.

* Source: Ibbotson Associates study; 1995.


The Importance Of Portfolio Rebalancing

• Rebalancing allows us to move assets from an asset class that has outperformed to another that may be the next to outperform.

• By rebalancing your portfolio at regular intervals back to stated initial target weights, we can keep your portfolio aligned to your investment objectives, improving the potential to achieve your investment goals.


1 Dalbar, Inc. Quantitative Analysis of Investor Behaviour, 2008. Average annual rates of return.

0.0%

5.0%

10.0%

15.0%

Index Return

4.5%IndividualInvestor

Opportunity

S&P 500 (1987-2007)1

Average Individual Investor1

Opportunity

11.8%

Investing Is About The Discipline To Stick To A Process


“To invest successfully over a lifetime

does not require stratospheric IQ,

unusual business insight, or inside

information. What’s needed is a

sound intellectual framework for

decisions and the ability to keep

emotions from corroding that

framework.”

Warren Buffett

Our Investment Management Philosophy

Our goal is to work with you to create an intellectual framework for making sound investment decisions utilizing our proprietary Portfolio Management System.


Portfolio Composition Process

Our portfolio composition process allows us to offer you investment solutions that will meet your personal investment objectives, time horizons, risk tolerance, income and liquidity requirements as well as your other specific preferences.

Strategic Asset Allocation Managed Asset Allocation Concentrated Portfolios

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About Counsel Portfolio Services Inc.

Counsel Portfolio Services Inc.^ is a portfolio management service that our team

retains to build portfolios for our clients based on the following criteria:

• Independent portfolio composition for our clients

• Specialized and diversified investment specialists

• No “in-house” money managers – all external – therefore objective in investment specialist selection

• Independent accountability of investment specialists (ability to change)

• Provide automatic rebalancing of your portfolio based on your portfolio criteria

• Help our team to simplify the administration of your portfolio:– One consolidated report– Easy on-line portfolio access– Consolidated tax reporting


Investment Specialist Selection Process

• One of the most important factors in portfolio management is to have a defined and disciplined approach to the selection of investment specialists for each mandate in your portfolio.

• Counsel uses a rigorous process to select investment specialists.• Using quantitative and qualitative evaluation criteria, a wide universe of potential

investment specialists are screened, researched and analyzed before the ideal candidate is selected for a mandate.


151

5 Years1996-2000

20

15

36

80

5 Years2001-2005

Source: Morningstar. Past performance of U.S. Equity Funds.

Top QuartileManagers

The Importance of Research When Selecting Investment Specialists

Our conclusion: Selecting an investment specialist is more than simply looking at previous performance

Quartile:

1

2

3

4

An investment specialist’s performance alone is not a good indicator of their future performance


Ongoing Portfolio Monitoring Process

The following are the services that Counsel Portfolio Services provides our team:

– Portfolio Rebalancing

• Back to original target allocations

– Portfolio composition analysis focused on security categorization

• Asset size, sector/geographic concentration

– Portfolio risk valuation

• Standard deviation, downside volatility, correlation

– Study relative performance among peers and benchmarks

• Cost shifting versus market appreciation, stock selection, turnover rate, asset mix

– Mandate Review

• Market capitalization, buy/sell discipline, geographic adherence

– Portfolio design and construction reviews by independent third party consultants


Investment Specialist Replacement Process

• As part of their service offering, Counsel’s Portfolio Management Team regularly monitors the performance of each investment specialist.

• On behalf of all investors, they will replace an investment specialist if the stated objectives are not being met.

Some of the reasons why Counsel may replace an investment specialist:

Philosophy & Process

Organization/

People

Performance Regulatory

• Fundamental strategy shift

• Mandate drift• Inconsistent

discipline

• Ownership change• Product capacity• Firm growth• Material personnel

concerns

• Unexpected performance results

• Risk exceeds portfolio guidelines

• Compliance matters


Stay Up-to-Date On Your Investment Plan With A Quarterly Portfolio Review


^ Counsel Portfolio Services Inc. is an related company to IPC Securities Corporation and IPC Investment Corporation. All three are subsidiaries of Investment Planning Counsel Inc. Commissions, trailing commissions, management fees and expenses all may be associated with mutual fund investments. Please read the prospectus before investing. Mutual funds are not guaranteed, their values change frequently and past performance may not be repeated.

Trademarks owned by Investment Planning Counsel Inc. and licensed to its subsidiary corporations. Investment Planning Counsel is a fully integrated Wealth Management Company. Mortgage Broker services provided by IPC Save Inc. (ON Lic.#10227). Mutual Funds available through IPC Investment Corporation and IPC Securities Corporation. Securities available through IPC Securities Corporation. Member-Canadian Investor Protection Fund. Insurance products available through IPC Estate Services Inc.

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