2. Table of Contents
1. High Net Worth Market Opportunity
2. Refine Your Client Segmentation Strategy
3. Why IPC Private Wealth
4. Comparative Facts: Mutual Funds and UMAs
5. Portfolio Management Team – An Extension to Your Team
6. Your Opportunities
1. House holding for Wallet Share Increase
2. Cash flow/income management
7. Costs
8. IPC Private Wealth Total Client Experience
9. Testimonials
10. Next Steps
6. Why IPC Private Wealth
Evolve and grow your business – focus on High Net Worth
Clients
Regulation is driving changes - CRM II
Expand your offering and target a new a market space
Add a discretionary wealth management service to your platform –
one previously beyond your direct reach
Target a growing, yet underserved market space – high net worth
investors
Expand wallet share of an existing client’s investable assets
Attract more referrals and reach to new clients
8. Evolve and Grow
A UMA allows you to offer your clients a sophisticated private investment
portfolio through which they can own a variety of investment vehicles all
within a single account – one that is regularly rebalanced to keep it aligned
to their objectives.
12. Portfolio Management Role
As an extension to your team, the Portfolio
Management Team will:
1. Construct and optimize your portfolio offering
effectively and efficiently using a Unified Managed
Account (UMA) structure.
2. Give your clients access to a wide variety of
investment opportunities - separately managed
accounts (SMAs), mutual funds, exchange traded
funds (ETFs), fixed income securities and alternative
asset class investment opportunities such as tail risk
protection strategies.
3. Monitor your portfolios using the expertise of an
Overlay Portfolio Manager. The Overlay Portfolio
Manager will monitor the daily trading activities
within each account, and provide oversight to tailor
and manage tax strategies for each client’s portfolio.
13. 4. Evaluate, research & monitor asset allocation trends, new investment opportunities, and market trends
using technical research data from an independent portfolio modeling service provider.
5. Go beyond routine portfolio rebalancing, which is aimed at keeping your client’s asset allocation strategy
aligned to their investment objectives.
6. Research, select & monitor the investment specialists on our roster. Through research, the Team will
ensure that the investment specialists are well matched to complement each other within a portfolio.
Through rigorous monitoring, we will ensure each investment specialist stays true to their mandate. If
necessary, an investment specialist may be replaced.
7. Efficiently manage cash flow strategies for your clients while remaining cost effective in our approach
using the IPC Private Wealth Cash Flow Account.
8. Provide strategies to consolidate small accounts such as TFSAs or RESPs to lower a client’s overall
investment costs.
Portfolio Management Role
15. For qualified clients, you can consolidate smaller family related
accounts (e.g. TFSAs, LIRAs, LRSPs or Joint Open accounts) under
the IPC Private Wealth umbrella to offer your client a more
attractive cost structure overall.
To consolidate smaller accounts, you can leverage any of the
Program's single solution Counsel Series P portfolios, developed
exclusively for this Program (for accounts below $50,000), or the
IPC Private Wealth Series P Portfolios
(for accounts below $250,000).
Why Take Advantage of this Program Feature?
Simplicity in the management of overall family accounts
It allows you to consolidate family assets and offer your client a
comprehensive view of their overall investments through a
single account statement.
Lower costs based on higher asset size
It streamlines and potentially lowers a client’s overall cost of
investing. Each account holder in the family will enjoy a single
Program Fee, per account, based on the family's overall assets.
Eliminate trustee fees
It allows you to offer cost savings. Any account held under the
IPC Private Wealth umbrella is free of trustee fees.
Household Accounts
House holding - Opportunity to Increase Wallet Share
16. Cash Flow Management / Income Strategy – Simplify
For clients who wish to draw regular cash from their investment account, we recommend the IPC Private Wealth Cash Flow
Account. This account can be used in tandem with any registered or non-registered IPC Private Wealth Portfolio solution to give
your clients a cost effective strategy for their overall plan.
Benefits of the IPC Private Wealth Cash Flow Account:
• More efficiency
– Provide your clients with an efficient and convenient solution to manage both their investment and cash flow needs
– Set cash flow payments at a frequency that is desired by your client
• More cost effective
– Offer your clients the opportunity for lower transaction costs by minimizing trades for the purpose of cash flow
generation and eliminating unnecessary portfolio rebalancing
• More Simplicity
– Set-up the IPC Private Wealth Cash Flow Account in tandem with your client's core IPC Private Wealth portfolio using
a single NCAF
– Eliminate the need for an external account outside the Program for cash flow management
• Improved opportunity for asset consolidation
– Keep your client's assets within the IPC Private Wealth program
– Provide consolidated reporting to reflect their overall investments on a single consolidated statement
• Maintain liquid & stable investments for cash flow management
– Keep your clients invested in a stable, liquid investment until the point at which they need cash flow
– Maintain the character and profile of a client's core investment solution
18. Cash Flow Portfolio
3. Your IPC Private Wealth Portfolios
IPC PW Core Plus
Fixed Income 59.0%
North American
Dividend 13.0%
Global Dividend
11.5%
Timbercreek
Global Real
Estate 8.5%
Global Alternative
4.0%
Global Small Cap
3.0% IPC Cash 1.0%
Corporate
Bonds
58.0%
Global
Fixed
Income
22.0%
High Yield
Fixed
Income
20.0%
19. Diversified Balanced Portfolio
3. Your IPC Private Wealth Portfolios
IPC PW Core Plus
Fixed Income 39.0%
North American
Growth 10.0%North American
Value 10.0%
Global Small Cap
10.0%
International
Growth Equities
8.5%
International Value
Equities 8.5%
Global
Alternative
8.0%
Global Real Estate
5.0%
IPC Cash 1.0%
Corporate
Bonds
58.0%
Global
Fixed
Income
22.0%
High Yield
Fixed
Income
20.0%
20. Focus Growth Portfolio
3. Your IPC Private Wealth Portfolios
IPC PW Core Plus
Fixed Income 19.0%
Global Small Cap
15.0%
North American
Growth 14.0%
North American
Value 14.0%
International
Growth Equities
10.0%
International Value
Equities 10.0%
Global Alternative
10.0%
Global Real
Estate 7.0%
IPC Cash 1.0%
Corporate
Bonds
58.0%
Global
Fixed
Income
22.0%
High Yield
Fixed
Income
20.0%
22. • The Program Fee* has two components:
– Cost of Management
– Administrative (Advisor) Fee
• Fees are calculated daily, and charged monthly based on the
client’s holdings
• Each account is charged “its own” schedule
• Costs may be tax deductible for non-registered plans
• Trustee fees are waived
• Trade costs are charged at $9.95 per trade. These costs are
passed through from NBCN
• Embedded Management Fees of any ETF holdings
.
Costs
* Subject to applicable taxes.
23. What the Cost of Management Covers
PORTFOLIO
REBALANCING
REPORTING &
COMMUNICATION
OPERATIONAL
OVERSIGHT
TAX LOSS HARVESTING
ASSET CUSTODY
& RECORD KEEPING
ACCESS TO LEADING
MANAGERS
OVERLAY PORTFOLIO
MANAGEMENT
PORTFOLIO CONSTRAINT
MANAGEMENT
PORTFOLIO DESIGN
OPTIMIZATION
24. Cost of Management
The management fees for the Program are determined based on several
factors, including:
The size of your client’s assets under management:
• The larger the account size, the lower the cost of management given
economies of scale. This is why many investors consolidate their holdings
into a UMA account.
The types of investments selected for your portfolios:
• An active portfolio management strategy is more costly compared to
passive portfolio management strategy. Through active management, an
investment specialist aims to add performance value that is over and
above their respective benchmarks and costs, while passive managers
simply aim to model the performance to the overall indices.
25. The Advantage of Active Management
• We combine active investment management styles with an active
overlay management strategy in the management and monitoring of
the IPC Private Wealth model portfolios
• In a recent study*, we found that actively managed portfolios offered
significant performance advantage relative to passive ETF portfolios
• e.g. PW Income & Growth model with a $500,000 investment
* Source: IPC Portfolio Management study; July 2014
1 Year 3 Years 5 Years
IPC Private Wealth Portfolio 17.21% 11.22% 12.75%
Passive Portfolio 14.70% 8.88% 10.69%
‘Cost’ of IPC Private Wealth
Management Fee Premium
-0.32% -0.32% -0.32%
Performance Benefit +2.51% +2.34% +2.05%
Net Benefit (%) +2.19% +2.02% +1.73%
Net Benefit ($) +$12,550 +$42,511 +$80,243
26. Transaction Costs
Before recommending a portfolio, it’s important to understand a client’s cash flow
requirements and evaluate the implications of trading fees based on the following
factors:
Your Client’s Portfolio Activity
• More frequent contributions and withdrawals in a portfolio will lead to
portfolio rebalancing, which will in turn lead to higher trading costs
• A client who needs frequent withdrawals may need a different solution than a
‘buy and hold’ investor in a similar sized portfolio
• For clients who expect to have frequent cash flow requirements, consider using
the IPC Private Wealth Cash Flow Account to minimize rebalancing and
unnecessary trade costs
Your Client’s Portfolio Size
• Trading costs have a relatively smaller performance impact on accounts that are
of a significant size
• “Smaller” accounts should not be invested in SMA solutions with individual
stock positions, as these costs can become more significant
Level up your offering and target a new a market space
Add a brand new wealth management service to your platform with a high net worth service – one previously beyond your direct reach
Target a growing, yet underserved market space – high net worth investors
Magnify your value to clients and strengthen relationships
Adapt your offering as your client’s wealth management needs evolves and financial status grows – go beyond mutual funds
Nurture, grow and deepen existing client relationships
Create client stickiness – be armed and ready to be proactive with your clients
Entrench your value as an investor’s Advisor of choice
As an extension to your team, the Portfolio Management will:
1. Construct and optimize your portfolio offering effectively and efficiently using a Unified Managed Account (UMA) structure.
A UMA allows you to offer your clients a sophisticated private investment portfolio through which they can own a variety of investment vehicles all within a single account – one that is regularly rebalanced to keep it aligned to their objectives.
Give your clients access to a wide variety of investment opportunities - separately managed accounts (SMAs), mutual funds, exchange traded funds (ETFs), fixed income securities and alternative asset class investment opportunities such as tail risk protection strategies.
3. Monitor your portfolios using the expertise of an Overlay Portfolio Manager. The Overlay Portfolio Manager will monitor the daily trading activities within each account, and provide oversight to tailor and manage tax strategies for each client’s portfolio.
The cost of investing in IPC Private Wealth is disclosed as an all inclusive fee, known as the Program Fee.
The ‘Program Fee’ in made up of two components, which are the Management Fee and the Administrative (or Advisor) Fee
These costs are calculated daily, and charged to the client portfolio each month, based on their holdings.
It is important to note that each account is charged “its own” fee schedule, but the rate for each account is based on the overall family asset size managed under IPC Private Wealth.
It is also important to keep in mind that there are separate trading costs that will be incurred for all transactions within an account. We will discuss trading costs a little more later.
Fees that are incurred for non-registered plans may be tax deductible. Investors are encouraged to explore these tax deductions with their accountant.
Once again, as a reminder, the trustee fees for all registered accounts held within IPC Private Wealth will be waived.
The Private Wealth model portfolios combine active investment management styles with an active overlay management strategy. Some competing investment options may appear less expensive, but a recent study* highlights the performance benefit that can more than make up for the fee difference. Over time, your client’s net performance – or bottom line – is what is most important.
