Wealth Professional 6.01

THE LOWDOWN ON CRYPTOCURRENCY

The numbers behind digital currencies’ meteoric rise

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The best of the best in Canadian wealth management

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INNOVATION ADVOCACY ACTIVE

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ISSUE 6.01

CONNECT WITH US

CONTENTS THE TOP

38

Got a story or suggestion, or just want to find out some more information? @WealthProCA facebook.com/WealthProCA

UPFRONT 02 Editorial

Ontario seeks to address the perpetual issue of regulating advisors’ job titles

04 Head to head

Advisors reveal how they’re responding to rising interest rates

06 Statistics FEATURES

A VALUE-ORIENTED APPROACH

20

Funds geared toward value investing are the latest innovation in Canada’s ETF market

42

SPECIAL REPORT

Find out who had a standout year in WPC’s annual ranking of Canada’s best financial advisors

Mackenzie Investments president and CEO Barry McInerney discusses the splash his company has made in the ETF space

16

Artificial intelligence is creeping into asset management – should portfolio managers be worried?

10 Intelligence

This month’s big movers, shakers and new products

12 ETF update

A new partnership gives advisors easy access to ETF model portfolios

Commercial mortgages: a viable alternative to fixed income?

FEATURES

INDUSTRY ICON

08 News analysis

14 Alternative investment update

TOP 50 ADVISORS

PEOPLE

Is cryptocurrency really as good a bet as it seems?

RISK, REWARD AND PRIVATE DEBT Four experts in private debt outline why it’s an alternative strategy retail investors should consider

19 Opinion

Why advisors should dig deeper into responsible investment claims

PEOPLE 40 Advisor profile

Matthew Rodier reveals how he beat the odds to achieve success as a young advisor

47 Career path

44

FEATURES

SAY NO TO DULL MEETINGS

You don’t need to have fewer meetings – you just need to have better ones

Even from an early age, Rob Tetrault knew he was destined to be his own boss

48 Other life

Ottawa advisor Brian Adams’ hobby is the bee’s knees

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12/01/2018 7:40:17 AM

UPFRONT

EDITORIAL

New year, new rules

J

ust who qualifies as a financial advisor or planner has been an ongoing issue in wealth management for some time now. Generally, the Certified Financial Planner [CFP] designation is the industry standard for those wishing to refer to themselves as financial planners. This isn’t enshrined in law, however, which has prompted the Ontario government to intervene on behalf of consumers.

Forthcoming legislation in the province will require advisors who refer to themselves as financial planners to obtain an appropriate financial planning credential such as the CFP. The Ontario government’s Fall Economic Statement, released in November, detailed how new regulations would restrict the use of particular titles. This latest move follows the recommendations of the Ontario Expert Committee to Consider Financial Advisory and Financial Planning Policy

“These new requirements will provide Ontarians with the confidence of knowing that any financial planner they entrust will be someone who ... is accountable for their professional conduct” Alternatives. The committee’s goal was to increase transparency in financial advice, and it identified the issue of unregulated titles as a real cause of confusion among the general public.

FPSC president and CEO Cary List heralded the legislation as a welcome development. “The current lack of regulatory standards for financial planning creates confusion and undermines the ability of consumers to make informed choices about their financial health,” List said in a statement following the announcement. “With careful implementation, these new requirements will create much-needed clarity and provide Ontarians with the confidence of knowing that any financial planner they entrust will be someone who has demonstrated appropriate competence, is ethically sound, is overseen by experts who represent the public interest and is accountable for their professional conduct.”

In order to improve the financial literacy of consumers and create a more level playing field among advisors, enforcing strict criteria on who can use a particular title is a natural first step, and one likely to receive support within the advisor community. It’s key to financial advice being seen as a profession rather than simply a job, which is the goal of everyone who provides this service for a living.

wealthprofessional.ca ISSUE 6.01 EDITORIAL

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Mutual funds are not guaranteed, their values change frequently and past performance may not be repeated. The iA Clarington Funds are managed by IA Clarington Investments Inc. iA Clarington and the iA Clarington logo are trademarks of Industrial Alliance Insurance and Financial Services Inc. and are used under license.

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12/01/2018 7:12:14 AM

UPFRONT

HEAD TO HEAD

How are rising interest rates affecting your strategy?

Now that rates appear to be on an upward trajectory, are advisors repositioning client portfolios accordingly?

Simon Partington

Nadeem Ibrahim

AJ Chase

Director of wealth management and portfolio manager Partington Khajadourian Wealth Management

Estate and financial planning specialist Educators Financial Group

Associate portfolio manager and senior wealth advisor AJ Chase Financial Group

“We are cautious not to overweight high-yield, leveraged bond or emerging market debt strategies that look attractive but increase return risk.

Bonds serve two purposes by providing non-correlated returns to equities and a steady income stream. There is a large liquidity premium today – investors give up returns for liquidity. Investors can benefit from alternatives like private debt, factoring or development loans, offering higher cash flow and reduced volatility when rates move higher or markets fall.

Investors who don’t need access to a percentage of their portfolio can lock money into term GICs, which have the same liquidity risks as alternatives.”

“Rising interest rates might negatively affect mutual funds that hold bonds, as well as broad equity funds in some cases. But some mutual funds may be positioned to benefit from higher interest rates. Floating-rate bonds, financial equities and cyclical equities tend to be strong performers during these periods because they benefit from higher rates.

In short, rising interest rates will likely have a negative impact on the financial markets since the cost of borrowing has increased. Bond funds may have the most to lose from rising rates. The good news is that some sectors may actually benefit from rising interest rates.”

“There has been solid earnings growth in the third quarter, and 2017 may post the best global GDP growth rates since 2011. With this, investors now have to come to terms with higher interest rates, especially in the US. We are not dramatically concerned with this development. Looking at US corporate revenues, firms with more global exposure experienced 5.8 times the revenue growth of domestic companies. We are overweight in US multinationals, Canada, Europe and Japan in the context of our long-term strategic asset mix. In fixed income, we have short- and mid-duration governments, corporates, and high-yield, with a sprinkling of preferreds.”

DUE TO OVERWHELMING INTEREST Although the Bank of Canada chose to hold its overnight rate at 1% in December, most experts expect the bank to continue to slowly increase rates, drawing attention to fixedincome exposures and real estate investments. “Rising interest rates are going to play a role here in Canada, but they have been gradual so far, and we expect that to continue when we look at what is priced into the market,” said Cynthia Caskey, vice-president and portfolio manager for TD Waterhouse, just before the September rate announcement.

“Debt levels have been driven by housing, so debt is matched against assets, and that is better than just consuming. Because of that, there has been a gradual increase.”

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Ottawa

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Calgary

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12/01/2018 5:49:03 AM

UPFRONT

STATISTICS

Currency’s new frontier

HOW CRYPTOCURRENCIES MEASURE UP

The past year was one of wild swings in cryptocurrency, but those who held strong were often rewarded OPINION IN the investment community is starkly divided on the merits of cryptocurrencies. What can’t be debated is that some of the main operators – Bitcoin, Ethereum, Dash – posted some impressive returns in 2017.

Bitcoin, the most popular digital currency in the space, had tallied YTD returns of 265% by the end of the third quarter.

Regardless, there are many in the industry who consider cryptocurrency little more than

600%

Return on cryptocurrencies for first three quarters of 2017

an elaborate scheme to defraud investors.

JPMorgan Chase CEO Jamie Dimon referred to anyone who buys Bitcoin as “stupid,” while Neil Dwane of Allianz Global Investors called it a “scam for criminals around the world.” CPPIB head Mark Machin was more diplomatic, saying that he didn’t believe Bitcoin was investable yet, but would monitor developments closely. It appears that despite some amazing returns in 2017, digital currency still has it all to prove.

US$997

US$13,412

Price of Bitcoin on January 1, 2017

Price of Bitcoin on January 1, 2018

While Bitcoin experienced some significant dips in 2017, generally its growth far outpaced other asset classes.

The price of Bitcoin started 2017 hovering above the US$1,000 mark and recorded exponential growth throughout the year that left blue-chip stocks like Amazon and Apple in the dust.

3,114%

YTD return on Ethereum by the end of the third quarter Source: CoinGecko Q3 2017 Cryptocurrencies Report

TOP 10 NAMES IN DIGITAL CURRENCY Even those unfamiliar with cryptocurrencies have likely heard of Bitcoin, but there are a number of other offerings emerging to challenge its premier status.

A LESSON IN VOLATILITY Market capitalization for the top 26 cryptocurrencies began the year just under US$20 billion and experienced both huge climbs and rapid falls during 2017. This reflects the uncertainty many investors still have in this vehicle.

US$180bn US$160bn

1. BITCOIN

US$140bn

2. ETHEREUM

US$120bn

3. BITCOIN CASH 4. RIPPLE 5. DASH

Market cap

US$100bn US$80bn

6. LITECOIN

US$60bn

7. NEM

US$40bn

8. IOTA

US$20bn

9. MONERO 10. ETHEREUM CLASSIC Source: CoinGecko Q3 2017 Cryptocurrencies Report, Quandl.com, Nasdaq.com

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Jan 2017

Feb 2017

Mar 2017

Apr 2017

May 2017

Jun 2017

Jul 2017

Aug 2017

Sep 2017

Source: CoinGecko Q3 2017 Cryptocurrencies Report

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PRICE GROWTH: CRYPTOCURRENCIES VERSUS NON-CRYPTO ASSETS US$5,000 US$4,500 US$4,000 US$3,500 US$3,000 US$2,500 US$2,000 US$1,500 US$1,000 US$500

Jan 2017

Feb 2017

Mar 2017

Apr 2017 S&P500 XAU

May 2017

Jun 2017

Jul 2017

Apple JP Morgan

Bitcoin Amazon

Aug 2017

Sep 2017

Ethereum

Source: CoinGecko Q3 2017 Cryptocurrencies Report, Quandl.com, Nasdaq.com

EYE-WATERING RETURNS

BITCOIN LEADS THE WAY

Bitcoin is the most established cryptocurrency, and while it had impressive returns in 2017, they paled in comparison to the four-digit numbers posted by Ethereum, Dash, Ripple and NEM.

While Bitcoin continues to dominate in terms of market cap in the cryptocurrency world, Ethereum is beginning to close the gap.

6,103%

MARKET CAP OF TOP 5 CRYPTOCURRENCIES Bitcoin

US$60.1 billion

Ethereum US$24.9 billion 3,114% 2,590%

2,846%

935% 265% Bitcoin

0% Ethereum Bitcoin Cash

Ripple

Dash

Litecoin

NEM

-4% IOTA

535%

621%

Monero

Ethereum Classic

Source: CoinGecko Q3 2017 Cryptocurrencies Report; as of 9/22/17

Bitcoin Cash

US$6.9 billion

Ripple

US$6.6 billion

Dash

US$2.5 billion

Source: CoinGecko Q3 2017 Cryptocurrencies Report, Quandl.com, Nasdaq.com

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UPFRONT

NEWS ANALYSIS

Rise of the machines Now that artificial intelligence is taking hold across asset management, should portfolio managers be concerned about their future?

ARTIFICIAL INTELLIGENCE has been a common trope in Hollywood for decades now. The idea that machines could one day turn against humankind isn’t that ridiculous a premise for most people. Despite those concerns, AI, Big Data and analytics are tools of the present, not the distant future.

According to Statista, worldwide revenue from Big Data and business analytics is expected to top $US200 billion by 2020.

In asset management, firms are now getting behind this technology in a big way. One company throwing its weight behind artificial intelligence is Horizons ETFs Management. The firm launched Canada’s first AI-focused ETF in November, the Horizons Active AI Global Equity ETF (MIND), which uses artificial intelligence for all of its securities selections. Using a machine learning process known as Deep

to generate a predictive portfolio for better investing,” Hawkins says. “It uses what it has learned from running through millions upon millions of scenarios based on that data, and it has learned to become a better investor.”

Hawkins and his team have placed a lot of faith in MIND, to the extent that neither they nor subadvisor Mirae Asset Global Investments will interfere in investment decisions. The fund is rebalanced every 30 days; AI dictates which underlying assets are retained or replaced.

“We are not going to override the trade decisions it makes; we will simply execute those decisions and see what happens,” Hawkins says. “We believe that an AI system lacking bias will make better decisions than a human portfolio manager.”

Security selection is one function AI

“We believe that an AI system lacking bias will make better decisions than a human portfolio manager” Steven Hawkins, Horizons ETFs Management Neural Network Learning, the fund offers a glimpse into what the future of the industry might look like, explains Horizons co-CEO Steven Hawkins.

“We used 10 years of data points for the system to learn from; from that, it was able

8

brings to the table in asset management, but there are many more. Fred Tavan, global head of Sun Life Financial’s Innovation Lab, explains how his company is using AI right now.

“We are using it in corporate marketing,

and what corporate marketing is developing will be rolled out across all our 18 business units,” Tavan says. “Each one of those units will use analytics to find out where clients think we are doing well and where they think we are not doing well by analyzing the unstructured commentary they have fed us through surveys.”

Natural language processing and sentiment analysis are the next evolution of market research, and they’re tools Sun Life will increasingly use to get a general view of their customers.

“This is something that wasn’t used before in terms of data – usually it would be multiple-choice answers,” Tavan says. “For a human being to analyze a lot of unstructured text and come up with common themes, when you are looking at thousands

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FAST FACTS: ARTIFICIAL INTELLIGENCE ’Artificial intelligence’ refers to the creation of intelligent hardware or software that is able to replicate human behaviours such as learning and problem-solving The term was first coined in 1956 by Stanford professor John McCarthy According to market intelligence firm Tractica, AI market revenue will increase from US$1.4 billion in 2016 to US$59.8 billion by 2025 Tractica also estimates that deep learning will be worth US$16 billion by 2025, while machine learning as a service will be worth US$19.86 billion by the same year PwC, meanwhile, predicts that AI will add up to US$15.7 trillion in global GDP by 2030 of survey responses, the process is very difficult. For a machine, it’s much easier.”

While advancements in technology are undoubtedly a positive, there is a negative

will AI deal a similar blow to the financial services sector?

In a recent article, Gaurav Chakravorty, co-founder of asset management firm

“For a human being to analyze a lot of unstructured text … the process is very difficult. For a machine, it’s much easier” Fred Tavan, Sun Life Financial side to this progress. The likelihood of a Terminator-style war against the machines is still pretty fanciful, but robots taking the place of humans in the workplace certainly isn’t. Much like automation in manufacturing has led to mass job losses for decades,

Qplum, predicted that about 90% of discretionary traders will lose their jobs, being replaced by machine-learning engineers and data scientists as AI takes hold. This new era isn’t decades away; rather, we are already in the formative stages, as Hawkins

points out.

“One of our subadvisors, Guardian Capital, is actively using AI every day to go through all of the news stories around the world affecting their universe of individual companies,” he says. “They use AI to interpret that data and predict growth, dividend growth, dividend cuts.”

While AI will clearly eliminate the need for certain jobs, it likely won’t lead to empty offices at asset management firms. When it comes to investing, there are certain times when the personal touch is necessary.

“There is always a human element that’s needed,” Hawkins says. “People want to know why decisions are being made, and because the AI system will never be able to tell us why it is making decisions ... I don’t think that will ever go away.”

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UPFRONT

INTELLIGENCE CORPORATE ACQUIRER

TARGET

PRODUCTS COMMENTS

Purpose Investments

LOGiQ Asset Management

Purpose has finalized its acquisition of LOGiQ’s retail asset management agreements

TMX Group

Trayport Holdings

TMX gave up subsidiaries NGX and Shorecan Energy Brokers in exchange for Trayport in an asset swap with Trayport’s parents company, Intercontinental Exchange

PARTNER ONE

PARTNER TWO

COMMENTS

Broadridge Financial Solutions

Wealthsimple

The partnership will allow Broadridge to enter the Canadian robo-advisor market

Glencore Canada Corporation

Ontario Teachers’ Pension Plan

The two entities have formed a joint-venture limited partnership focused on base-metal streams and royalties

Qtrade

Credential Financial, NEI Investments

The three firms are merging to form one of Canada’s largest wealth management firms

Capital Group launches global bond fund

Capital Group has rolled out the Capital Group World Bond Fund (Canada), which seeks to provide a prudently managed portfolio of bonds and other globally issued debt securities. According to portfolio manager Thomas Høgh, high-yield strategies are at risk of sharp price declines, so the fund focuses instead on investment-grade bonds – including mortgage- and asset-backed bonds – that cover a range of different countries, currencies, credit quality, and coupon or maturity. The fund’s exposure to the varied economic cycles, yields and currency valuations of the global bond markets is designed add an extra layer of diversification.

Mega-merger to form new wealth firm

Qtrade Financial, Credential Financial and NEI Investments have announced plans to merge into a new entity known as Aviso Wealth. The new firm will provide wealth management services for 500,000 clients in the Canadian credit-union system, managing assets worth a total of $55 billion.

The deal is poised to make financial giant Desjardins Group – which owns Qtrade and co-owns NEI – a key partner in delivering financial advice, asset management, discount brokerage and a slew of other services for all Canadian financial co-operatives. Quebec-based Desjardins will have 50% ownership of Aviso Wealth; the other 50% will be shared by the CUMIS Group and the five provincial credit union centrals. The transaction is expected to close in the first quarter of 2018, and the merger is expected to be finalized 12 to 18 months after that.

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RBC lowers fees for BlueBay and education funds

RBC Global Asset Management has reduced fees for three BlueBay Funds and for certain series of the RBC Target 2020 Education Fund.

Management fee reductions of 0.15% took effect on January 1 for Series A, D, F and I of the BlueBay Global Monthly Income Bond Fund, as well as Series A, D and F of the BlueBay European High Yield Bond Fund (Canada) and the BlueBay Emerging Markets Corporate Bond Fund. RBC also reduced fees by 0.1% to 0.55% for Series A, D and F of the RBC Target 2020 Education Fund.

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12/01/2018 5:51:02 AM

PEOPLE HSBC lowers risk ratings for pooled funds

HSBC Global Asset Management has lowered the risk ratings for five HSBC Pooled Funds. The HSBC Canadian Bond Pooled Fund has gone from ‘low to medium’ to ‘low,’ the HSBC Global High Yield Bond Pooled Fund has gone from ‘medium’ to ‘low to medium’, the HSBC Canadian Small Cap Equity Pooled Fund has gone from ‘medium to high’ to ‘medium’, and the HSBC Emerging Markets Pooled Fund and HSBC Global Real Estate Equity Pooled Fund have both gone from ‘high’ to ‘medium to high.’ HSBC made no changes to the investment objectives or strategies of the funds.

Sun Life announces pricing changes for mutual funds

Sun Life Global Investments has reduced management fees and operating expenses across its mutual fund lineup. As of January 1, fees have been reduced anywhere from 0.05% to 0.35% on certain A, AH, T5, T8, AT5, AT8, F, FH, O and OH Series across 50 Sun Life mutual funds. “By lowering fees on our mutual fund lineup, clients can keep more of their money working for them, giving them even more peace of mind,” said Rick Headrick, president of Sun Life Global Investments. In addition, Sun Life is scaling back management fees in its private client program for clients with $500,000 or more in eligible assets who join after March 28.

Merger approved for Goldman Sachs fund

Unitholders of the Goldman Sachs US Income Builder Trust have approved the firm’s proposal to merge the fund with the Symphony Floating Rate Senior Loan Fund. As a result, Goldman Sachs expects the fund to have a higher monthly distribution, lower MER and management fee, enhanced liquidity, improved trading price, and sustained exposure to hedging. Pending regulatory approval, the merger is expected to take place on or around February 8, and all merger costs will be borne

by Goldman Sachs.

NAME

LEAVING

JOINING

NEW POSITION

Jordy Chilcott

Scotiabank

Sun Life Global Investments

Head of investment distribution

Luke Gould

N/A

IGM Financial

Executive vice-president of finance and chief financial officer

Patrick Lynch

Caisse de Dépôt et Placement du Québec

Fiera Comox

Partner, private equity

Ram Ramaswamy

Goldman Sachs Asset Management

Neuberger Berman

Managing director and head of investment solutions

Denis Ricard

N/A

iA Financial Group

Chief operating officer

Sun Life names head of investment distribution

Sun Life Global Investments has appointed Jordy Chilcott as its new head of investment distribution. Chilcott will lead the firm’s distribution arm and create strategies for sales growth across all retail products in Canada, in addition to managing relationships with third-party partners. Previously, Chilcott oversaw multiple asset management companies across Canada, Mexico and Asia as senior vice-president of global asset management at Scotiabank, and as president and CEO of Dynamic Funds.

“Jordy is well known and a strong force in the industry, bringing a great depth of experience and a real passion for distribution and client service,” said Sun Life Global Investments president Rick Headrick.

iA Financial Group appoints new COO

iA Financial Group has named Denis Ricard as its new chief operating officer. Ricard will assume full responsibility for the firm’s individual and group insurance operations in Canada and the US, which account for more than three-quarters of the company’s earnings. Ricard has been with iA Financial Group since 1985, starting as a corporate actuarial analyst and eventually rising to become executive vice-president of individual insurance and annuities.

“This appointment recognizes the outstanding performance that Denis has delivered throughout his 32-year career with iA Financial Group,” said iA Financial president and CEO Yvon Charest.

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UPFRONT

ETF UPDATE NEWS BRIEFS New survey reveals five-year outlook for the ETF industry In a recent survey of institutional ETF users conducted by EY, 67% of respondents said they expect most asset managers will have an ETF offering in the next five years. While the cost focus in the investment industry is expected to make ETFs even more popular than they are today (EY expects new investors to make up 15% to 25% of ETF inflows over the next three years), investors are looking for more innovative products. EY also found that 43% of respondents believe there isn’t enough competition among ETF index providers.

Manulife expands its multi-factor ETF lineup with two new funds Manulife Investments has launched two new funds on the TSX, both subadvised

by Dimensional Fund Advisors. The Manulife Multi-factor Canadian SMID Cap Index ETF (MCSM) invests primarily in Canadian small- and mid-cap equities.

The Manulife Multi-factor US Small Cap Index ETF, which makes direct or indirect investments primarily in US-listed smallcap equities, is available in both hedged (MUSC) and unhedged units (MUSC.B).

Management fees are 0.6% (MCSM), 0.55% (MUSC) and 0.5% (MUSC.B).

Hedged units now available for four First Trust ETFs FT Portfolios Canada has announced the launch of hedged units for four US sector ETFs it manages. In December, the firm launched new hedged series of the First Trust AlphaDEX US Consumer Staples Sector Index ETF (FHC.F), the First Trust AlphaDEX US Industrials Sector Index

12

ETF (FHG.F), the First Trust AlphaDEX US Technology Sector Index ETF (FHQ.F) and First Trust AlphaDEX US Health Care Sector Index ETF (FHH.F). Each of the hedged ETFs will seek to replicate the performance of its respective index, hedging currency exposures back to the Canadian dollar.

Mackenzie launches femaleleadershipfocused ETF Mackenzie Investments has launched a new leadership impact ETF on the NEO Exchange that promotes the benefits of women in leadership. Subadvised by women-focused impact investment firm PAX Ellevate Management, the Mackenzie Global Leadership Impact ETF (MWMN) screens for global companies that have proportional representation of women on boards of directors and in leadership positions. “The Mackenzie Global Leadership Impact ETF provides investors with a progressive product, promoting the benefits of gender diversity,” said Michael Cooke, Mackenzie’s senior vice president and head of ETFs.

First Asset adds US dollarbased units to its bond ETF First Asset Investment Management has added US dollar units for its First Asset Investment Grade Bond ETF (FIG.U). The ETF, which has been available in Canadian-dollar units since August 2016, aims to provide exposure to high-quality investment-grade corporate bonds from issuers in Canada, the US and Europe.

Managed by Marret Asset Management, the ETF is designed to provide monthly cash distributions and maximize total returns, primarily from monthly distributions, while reducing risk and preserving investor capital.

Helping advisors gain an ETF edge A new partnership is giving fund dealers an easier way to provide advisors access to ETFs As the growth of ETFs continues in Canada, more mutual fund dealers and advisors are showing interest in Vexo Technology Solutions’ ETFbahn system. Launched in April, the system is designed to integrate with dealers’ platforms so their advisors can help clients get seamless, direct exposure to ETFs. “We’ve been getting a lot of calls from advisors who say ETFs that are wrapped mutual funds aren’t cutting it for them,” says Vexo president Fotios Saratsiotis. “They want the real McCoy.” Through the ETFbahn system, dealers can access around 500 ETFs listed on Canadian exchanges, excluding leveraged, inverse and trailer-fee-paying ETFs. According to Saratsiotis, the ETFbahn pipeline has been stress-tested to handle any volume required

by MFDA dealers, and ETFs are available on the platform as soon as they’re launched on Canadian exchanges. From there, dealers can decide which funds to put on their own product shelves.

Some dealers have made ETFs available to clients through referral arrangements, but Saratsiotis says such arrangements can take the clients’ assets off the books of the dealership, which could effectively weaken or sever advisor-client relationships. “What we offer doesn’t cut off that line between the advisor and the client,” he says.

A new partnership between Vexo

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and robo-advisor Justwealth Financial will significantly enhance the ETFbahn system.

Advisors using the system will now have access to a wide range of model ETF portfolios, giving investors the appropriate mix of ETFs for their needs.

“If you’re going to serve the diverse Canadian market, you’ll need a vast arsenal of portfolio options,” says Justwealth president Andrew Kirkland. “With our expertise in asset allocation and ETF selection, we’ve created

“What we offer doesn’t cut off that line between the advisor and the client” a lineup of over 60 model portfolios – significantly more than any other robo-advisor.”

Although digital advice firms are widely perceived to cater to millennials, Kirkland says gen-xers and baby boomers make up a large portion of Justwealth’s client base.

“They tell us they’re attracted to our sophistication and ability to fulfil their wide range of investment objectives,” he says.

That same portfolio-construction expertise can benefit advisors who may not be overly familiar with ETFs yet. “Advisors who have been selling mutual funds for many years may not be comfortable with learning about ETFs, so we want to make it easy for them,” Saratsiotis says. “We’re freeing up advisors’ time, enabling them to focus more on client relationships and help their clients work toward long-term goals – which is valuable particularly to older investors who have longstanding relationships with their advisors.

What we have is a true hybrid – the advisor manages the relationship, the robo does the investing, and all assets stay on-book.”

Q&A

Mark Purdy Managing director and chief investment officer ARROW CAPITAL MANAGEMENT

Years in the industry 20+ Fast fact Arrow’s first ETF, introduced in December 2017, provides a new way to access its Exemplar Investment Grade Fund

Going active in bonds What opportunities do you see for active bond ETFs in Canada?

I think there are tremendous opportunities on the active side.

Obviously, there’s already a lot of passive ETFs on the bond side.

More recently, we’ve seen a lot of new entrants in the active space, including PIMCO, and we’ve been hearing more advisors asking for the option to incorporate active ETFs on both the fixed-income and equity sides. And with the proliferation of rules-based or smart beta ETFs, we viewed it as an opportune time to provide investors with one of our liquid alternative options in an ETF format.

Our strategy fits really nicely in passive bond portfolios because of the active nature of the underlying investment, the fund’s flexibility to invest in the US as well as Canada, and its ability to hedge out rates. Interest rates have been on a downward trend since 2008, but recently they’ve started to pick up. We expect that to continue over the next 18 to 24 months. The global economy seems quite strong with good GDP growth numbers, and some banks believe we may see multiple rate hikes next year in the US and domestically.

How does your fund protect investors from the risks associated with rising interest rates?

The fund managers try to bring the duration of the bond portfolio down to within two or three years. And in this state, defaults are traditionally extremely low. When you bring in the duration of the portfolio, if rates do go up, you can use excess cash for leverage to essentially reinvest at higher rates.

This strategy has been in place since the inception of the fund.

The first two years were quite difficult, as rates were continuing to fall, but even then we were able to protect investor capital. One of our main objectives for all of our funds is to generate good risk-adjusted returns and protect on the downside, and over the last 18 months, the strategy has really performed well with rates starting to go up.

The fund is actively managed by East Coast Fund Management. What strengths do they bring to the table?

East Coast was founded by Mike McBain, who was previously the managing director and head of global debt markets for RBC Capital Markets and president of TD Securities. His long professional history and experience have been crucial in running the strategy at East Coast over the past six years. He’s built a good team, and they’re really well positioned to take advantage of fixed-income opportunities in Canada and the US.

What returns can investors in your new ETF expect?

It really depends on how quickly rates move. In a scenario where rates just flatten, we’re probably looking at a 3% to 5% return with very low volatility; if rates move up more meaningfully, returns can be higher than that. Over a rising-rate cycle, we expect to generate 5% to 8% returns with very low volatility.

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12/01/2018 5:52:06 AM

UPFRONT

ALTERNATIVE INVESTMENT UPDATE

Looking to commercial mortgages for yield As interest rates rise, investors might be able to avoid risks through an alternative fixed-income vehicle

allow it to diversify risks from individual mortgages and produce laddered loan maturity dates, and the loans originated by the fund are secured against high-quality properties.

“At the heart of our conservative mortgage portfolio is the fact that we’re registered on title as a secured creditor on property,” Rowland says. “That means that in the event of a real estate value decline, the equity of the borrower is at risk first.”

“Like bonds, [commercial mortgages] have set interest payments and maturity dates, but they also provide higher relative yields” Asset managers, pension funds and other institutional investors are facing the tough task of finding yield in traditional fixed-income assets.

To fulfil their income obligations, many have chosen to explore alternative investments, including commercial mortgages.

“I look at commercial mortgages as an ideal alternative,” says Scott Rowland, senior vice-president and co-head of debt strategies at Fiera Properties. “Like bonds, they have set interest payments and maturity dates, but they also provide higher relative yields at a shorter duration.”

NEWS BRIEFS

Rowland co-manages the Fiera Properties CORE Mortgage Fund, a recently launched open-ended fund that offers mortgage loans with a shorter duration to help protect investors against the downside risks of rising interest rates.

“If you look at the FTSE Universe Bond Index today, it’s yielding around 2.3% with a duration of about seven and a half years,” Rowland says. “Our fund is designed to deliver a net yield above 4% with a duration of around two years.”

In addition, the fund’s size and nature

Global hedge funds increasingly investing in tech

In its recent survey of global hedge funds, EY found that 57% of hedge funds are investing in or plan to invest in operational efficiency, generally through technology aimed at enhancing data reporting and management, while 25% of managers are focusing on artificial intelligence and robotics. Meanwhile, 40% of managers said they were working on automating manual processes, and 46% said they expected to use more nontraditional data, such as social media and private company data, in investment decisions.

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To screen for the best return prospects, Rowland and co-manager Geoff McTait focus exclusively on commercial assets, diversified across property types such as office, multifamily residential, industrial and retail. In underwriting each loan, Rowland and McTait follow a four-pillar framework known as SAME, which looks at the sponsor, asset, market and execution of the loan.

“What we want is to check these four pillars and to find strength across the board,” he says.

“Our objective is to get repaid 100 cents on the dollar 100% of the time. There are many loan opportunities, so we are always looking to optimize the use of investor capital.”

Mainstreet makes key acquisition and takes new name

Mainstreet Health Investments has entered into an agreement with Tiptree to acquire Care Investment Trust [CareIT].

With an aggregate purchase price of around US$425 million, the transaction will allow Mainstreet to diversify its investments with CareIT’s portfolio of 42 US-based seniors housing and care properties, increasing its overall investments in the sector to 80 properties. To eliminate confusion with entities that use a similar name, Mainstreet also announced plans to change its name to Invesque, effective in early January.

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Q&A

Adam Spence

Helping Canadians invest with impact

Founder and director SVX

Years in the industry 10 Fast fact A total of 149 ventures have participated in SVX investment readiness programs and on the SVX 1.0 platform since 2013

SVX just launched a new ethical investment platform at the TSX in November. What new opportunities has that opened up?

How much interest has impact investing garnered from both accredited investors and retail investors?

The platform has new issuers to provide additional opportunities for Canadians to invest in. That includes First Nations Bank of Canada, the Immigrant Access Fund and Peekapak, which are geared toward First Nations reconciliation, supporting the success of new Canadians, and the education and wellness of children, respectively.

The first version of SVX was open to accredited investors, but the current offerings are available for any investor across the country to align their money with their values. Currently, we’re registered as an exempt market dealer in Ontario, Quebec, British Columbia, Alberta and Saskatchewan. To be a truly national platform, we want to expand into other provinces such as Manitoba, Atlantic Canada and the Territories in 2018.

The Canadian impact investing marketplace has grown significantly over the past five years to just over $9 billion in assets. In the last two years, it’s swelled by around 123%, counting both accredited and retail investors. Around the world, the impact investing marketplace is worth roughly $120 billion, and it’s been growing by $15 billion annually based on the top 200 impact investors alone. By 2020, it’s projected to have $320 billion in AUM across asset classes.

Which sectors and stakeholders have benefited from taking part in your platform?

We cut across sectors focused on addressing social and financial challenges: clean technology, work and learning, health and wellness, food, and social inclusion.

We’re really working on increasing access to capital for enterprises – from early to scaling stage – that aim to tackle these kinds of issues.

In addition, we’re helping investors and other financialsector professionals looking for opportunities to invest for impact. Whether it’s a financial advisor, a portfolio manager or a retail investor, we enable them to activate their investment portfolio in line with their values.

Bitcoin ETFs could arrive within six months

The December launch of a Bitcoin futures market in the US might pave the way for another cryptocurrency investment option. Eric Balchunas, Bloomberg’s senior ETF analyst, believes regulators may soon rethink their rejection of Bitcoin ETFs. Balchunas told ETF.com that there are five futures-based Bitcoin ETFs, one physically backed Bitcoin ETF and five equity blockchain ETFs currently awaiting regulatory approval. He estimated that an ETF holding actual Bitcoin could attract as much as US$10 billion in assets upon launch.

What associations and organizations are you collaborating with currently?

TMX Group, the parent company of the Toronto Stock Exchange, has been an invaluable partner.

They’ve been committed in providing talent, support, space and more for the better part of the last 10 years.

From working out feasibility and development to ultimately launching, they’ve been critical to our social enterprise.

We’re also working with foundations and investor networks to build out education and awareness among investors as part of our capacity-building mandate.

In addition, we work with BDC, RBC, BMO and other major financial institutions. Aside from providing talent, insight and resources, they’re also introducing impact investing to their business clients, as well as their investing clients. We’re truly excited to have these names coming and aligning themselves with our mission.

New partnership creates global cannabis fund

Matco Financial and Raintree Financial Solutions have teamed up to create the Matco Cannabis Investment Fund, which invests in micro- to large-cap companies that are expected to benefit from the evolving global cannabis industry.

While the fund is concentrated mainly on Canadian cannabis securities, it can potentially invest globally as opportunities arise from expansions in the industry and regulation. The fund will managed

by Matco and distributed by Raintree Financial Solutions.

Decreased US PE activity forecast for 2018

In its 2018 Private Equity Outlook, private-market research firm PitchBook predicted a decrease in the number of active US private equity investors. According to senior analyst James Gelfer, the rate of expansion in active PE investors has been falling since 2014. “[In 2017], the number of active investors fell for the first time since at least 2000,” he said. The decrease is reportedly being driven by consolidation, as well as a continuing slide in the number of newly active funds.

www.wealthprofessional.ca

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12/01/2018 5:53:03 AM

PEOPLE

INDUSTRY ICON

LEADING FROM THE FRONT Mackenzie Investments president and CEO Barry McInerney discusses the evolution of asset management in Canada

CEOs TEND to hold strong ideas about how a company should be run. This can cause disruption whenever there’s a change in leadership, but there were no such worries for Mackenzie Investments when Barry McInerney replaced Jeff Carney as head of the firm in 2016.

The asset manager, a subsidiary of IGM Financial and part of the Power Corporation of Canada family, was already going through a transitional period at the time, but McInerney was fully on board with the changes being made to update the brand.

Now approaching his second anniversary as president and CEO, he reflects on how the job continues to excite and challenge him.

“I’ve been in the investment industry over 25 years, half in Canada and half in the United States, and the pace of change always amazes me,” McInerney says. “Although we are executing on a strategy and doing it well, the environment shifts very quickly.

However, we pride ourselves on our ability to pivot and adapt to the changing environment to the benefit of the Canadian investor.”

The year McInerney came on board – 2016 – was a pivotal time for Mackenzie. The firm entered the ETF space that year, and later emphasized its global aspirations by buying a 10% stake in one of China’s leading asset managers, China Asset Management Co. Since then, Mackenzie has expanded its ETF suite to 15 funds while increasing its

16

stake in China AMC to 13.9%. That partnership led to the launch of the All China Equity Fund this past October, offering Canadian investors greater access to the world’s second largest economy.

Exploring new avenues of business will continue to be a priority for Mackenzie as the investment landscape shifts considerably. “The baby boomers continue to drive the wealth and asset management business

The ETF landscape Mackenzie Investments celebrated its 50th anniversary last year, and while history is no doubt important, McInerney is adamant that the firm must remain a forward-thinking enterprise. Its ETF suite is central to that ambition, as well as a growing part of its overall business. The Mackenzie brand was originally built on mutual funds, and while they are still a vibrant and growing part of

“We are the fastest-growing ETF platform in Canada in terms of percentage growth.

We are at $1.3 billion in AUM – the second fastest to reach a billion after BMO. In the products we have launched and will continue to launch, we want to be highly differentiated” in Canada, although the older boomers are in the decumulation phase,” McInerney says.

“But we are also very sensitive to the needs of millennials and women investors, who are increasing their control of investable assets.”

Sensitive in this case means a leadership fund that tracks a global women’s index, as well as a new sustainable, responsible and impact [SRI] fund that is sure to curry favour with millennials.

the company, its new ETF platform has also proven a huge success so far.

“We are the fastest-growing ETF platform in Canada in terms of percentage growth,” McInerney says. “We are at $1.3 billion in AUM – the second fastest to reach a billion after BMO. In the products we have launched and will continue to launch, we want to be highly differentiated.”

Most recently, this meant the launch of

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12/01/2018 5:53:26 AM

PROFILE Name: Barry McInerney Title: President and CEO Company: Mackenzie Investments Based in: Toronto Years in the industry: 25 Fast fact: A graduate of the University of Toronto, McInerney has worked in both the US and Canada for the likes of BMO Global Asset Management, Russell Investments and Mercer

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12/01/2018 5:53:31 AM

PEOPLE

INDUSTRY ICON

four new ETFs: the Mackenzie Ivy Global Equity ETF (MIVG), Mackenzie Canadian Short Term Fixed Income ETF (MCSB), Mackenzie Global Leadership Impact ETF (MWMN) and Mackenzie Portfolio Completion ETF (MPCF).

McInerney sees the firm today as having evolved into a diversified investment management solutions provider, offering mutual funds, ETFs, pooled funds, SMAs and many other capabilities across all asset classes. The success of its ETF platform proves that there is advisor and investor demand for the type of ETF solutions that Mackenzie provides.

you are able to develop and offer the best solutions to your customers. There are well documented regulatory pressures we are dealing with in Canada, as well as pricing pressures, and that means an increased need to grow your scale in order to continue to lead the market with innovative solutions.”

An advocate for advisors As Mackenzie adapts to the challenges of asset management in 2018 and beyond, one thing that won’t change is its commitment to the advisory channel. Technology may be changing how investors access products like

“We present ourselves to advisors as a business partner. We want to help make them the best they can be because our interests are aligned in meeting the financial goals of the end investor” “In the US, there are projections for the ETF industry to catch up in size to mutual funds,” McInerney says. “The ratio now is about five to one – US$15 trillion to about US$3 trillion. In Canada, the ratio is around 10 to one – approximately $1.4 trillion for mutual funds and $140 billion in ETFs. ETFs are growing faster, but mutual funds are still growing in Canada as well. We want to be leaders in both.”

It’s a lofty aim, but one that’s totally achievable, in McInerney’s opinion. In its 50 years in operation, Mackenzie has seen many of its competitors come and go, but it remains in a strong position to last another 50 and more. Consolidation is an ongoing trend in the industry, but with IGM Financial as its parent company, Mackenzie holds a healthy competitive advantage over many other firms.

“In the asset management industry, success is hinging more on scale,” McInerney says. “When you invest to build out your capabilities, your platforms, your technology,

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mutual funds and ETFs, but that doesn’t mean financial advisors are an endangered species, McInerney says.

“We present ourselves to advisors as a business partner,” he says. “We want to help make them the best they can be because our interests are aligned in meeting the financial goals of the end investor. We expect shelves to shrink for advisors going forward as they partner up with a smaller amount of firms – those that have demonstrated they can innovate with relevant solutions.”

In that respect, he believes Canadian advisors will more closely mirror those in the US, with larger and much more sophisticated books of business. No industry can hold back change, and wealth management is no different.

“We think that human advice will continue to be the cornerstone of the retirement and wealth business in Canada,” McInerney says.

“Advisors can use technology more effectively to service their clients, but there will be a convergence of technology and advice.”

A BRIEF HISTORY OF MACKENZIE INVESTMENTS

1967 Mackenzie Financial Corporation is founded by Alexander Christ; the firm launches its first fund – the Industrial Growth Fund – the following year

1973 Mackenzie becomes a public company

1981 The firm’s common shares are listed on the Toronto Stock Exchange

2001 Power Financial, through its ownership of Investors Group, acquires Mackenzie Financial Corp.

2016 Mackenzie purchases a stake in China Asset Management Co. and enters the Canadian ETF space

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12/01/2018 5:53:33 AM

UPFRONT

OPINION

GOT AN OPINION THAT COUNTS? Email wealthprofessional@kmimedia.ca

Wrestling with responsibility As responsible investing becomes more widespread, writes Ryan Colwell, advisors must be fully informed about what they’re signing their clients up for RESPONSIBLE INVESTING strategies have gone mainstream. CI, Franklin Templeton, Mackenzie, HSBC and State Street all issued RI press releases in 2017. According to the Responsible Investing Association’s 2016 Canadian RI Trends Report, 92% of clients have shown interest in RI. Now more than ever, advisors need to do their homework.

While I’m excited by the increased attention RI is getting, it makes me wonder if simply signing the United Nations Principles of Responsible Investment [UNPRI] is a strong enough case to advertise as responsible investors.

Take, for example, CI Investments. A few months ago, I happened upon the company’s website and noticed a press release announcing that CI Investments had signed the UNPRI. The press release read: “In becoming a signatory, CI joins some of the world’s largest investment managers, representing more than US$60 trillion in assets under administration.”

CI also released its Responsible Investment Policy the same day. A quick read of the four-page document revealed that while it is a great first step, in my opinion, their commitment to RI remains measured. CI seems to have committed to only “consider” environmental, social and governance [ESG] issues, and with the exception of cluster munitions, CI will not negatively screen out anything from its portfolios. “Although we believe ESG factors are usually an important consideration,” the policy reads, “we generally do not exclude any particular investment or industry

based on ESG factors alone.”

CI makes no mention of a best-in-sector approach (i.e. investing in companies that are ESG front-runners) or impact investing (investing with the intention to generate a beneficial social or environmental impact).

However, CI does discuss active ownership – the concept of using share owner-

CI is not alone. Many other mutual fund companies have announced similar ‘RI-lite’ statements recently. Far from criticizing CI and others, I applaud their entry into the RI market – but I wonder if it is enough.

To be a signatory of the UNPRI, investment managers must sign the six internationally recognized Principles for Responsible Investment, which include a number of key aspects of RI, such as ESG reporting, transparency, active ownership and ultimately incorporating ESG into the investment decision process. What is concerning is that as the UNPRI website explains, “The six principles themselves are voluntary and aspirational. For most signatories, the commitments are a work in progress and provide direction for their responsible investment efforts, rather than a checklist with which to comply.”

The UNPRI goes on to say that “the only mandatory requirement ... is to publicly report on your responsible investment activity through the reporting framework.” Currently, even if a company’s mandatory report indicates

“Many mutual fund companies have announced ‘RI-lite’ statements recently. Far from criticizing them, I applaud their entry into the RI market – but I wonder if it is enough” ship to compel corporations to address ESG concerns. “CI Investments’ portfolio managers and analysts meet with the entities in which they invest on an ongoing basis,” the policy reads, “and often discuss the risks and opportunities relating to ESG factors.”

While CI’s engagement policy seems to revolve around better understanding how ESG issues will affect the specific companies they invest in (a good thing), the company fails to discuss using its power as a shareholder to influence those companies to improve. This represents a missed opportunity, in my mind.

The use of shareholder proposals (which gives shareholders the right to circulate proposals for a vote at the company’s AGM) is also not mentioned in the document.

no RI activity, it can continue to be in good standing with the UNPRI. While I don’t suspect any company would do such a thing (the report is, after all, public), I worry that clients and advisors won’t dig through the details to understand the major differences between the growing numbers of offerings in the Canadian mutual fund universe. If advisors don’t ‘know their product,’ clients might find they are not getting the level of RI commitment they had hoped for.

Ryan Colwell is a responsible investing specialist with IPC Investment Corporation/C&C Planning Group in Georgetown, Ontario.

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12/01/2018 7:43:40 AM

FEATURES

SPECIAL REPORT

THE TOP

Wealth Professional Canada spotlights 50 of the best advisors working in the wealth management industry today EACH JANUARY, Wealth Professional Canada rings in the new year by highlighting the wealth management industry’s premier talent. WPC’s fifth annual Top 50 Advisors list contains some familiar faces, as well as a few young guns just starting to make a name for themselves. There is a healthy mix geographically, too – while Ontario dominates, seven provinces are represented in this year’s selection.

In terms of the rankings, WPC has streamlined the criteria for the Top 50 list – those who maintained and added the most assets over 2017 are ranked the highest.

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While an advisor’s abilities can’t be measured by book size alone, this typically offers a good indication of how they are performing.

In total, this year’s Top 50 Advisors manage more than $11 billion in assets, a considerable increase on last year’s $8.8 billion. Thanks in part to the markets’ strong performance, these advisors have been able to generate greater returns and grow assets impressively throughout 2017.

In terms of client numbers, the advisors featured here were somewhat selective in taking on new business in 2017. The average client count among the Top 50 is

378, although those offering discretionary management were likely to have considerably fewer clients. The majority are also now operating on a fee-only basis, which represents something of a sea change from the days when commissions were the compensation model of choice.

While the experience of the advisors featured here ranges from four years in the business to 36, it’s heartening to see some new names on the list. In an industry that has struggled to attract new talent, this year’s Top 50 list suggests progress is being made.

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Top 50 Advisors RANK

NAME

YEARS IN THE INDUSTRY

PRACTICE

BROKERAGE/DEALER GROUP

LOCATION

AUM*

AUM GROWTH†

NUMBER OF CLIENTS*

NEW CLIENTS GAINED†

1

Chad Larson

14

MLD Wealth Management Group

National Bank Financial

Calgary, AB

$776,000,000

24%

400

40

2

Rob Tetrault

8

Tetrault Wealth Advisory Group

National Bank Financial

Winnipeg, MB

$341,000,000

54%

748

115

3

Brad Moore

34

SAGE Connected Investing

Raymond James

Calgary, AB

$244,000,000

85%

274

83

4

Larry Short

29

ShortFinancial

HollisWealth, Industrial Alliance Securities

St. John's, NL

$217,000,000

70%

535

363

5

Reg Jackson

21

JMRD Wealth Management Team

National Bank Financial

London, ON

$525,000,000

11%

265

15

6

Faisal Karmali

10

Popowich Karmali Advisory Group

CIBC Wood Gundy

Calgary, AB

$450,000,000

18%

464

60

7

Robert McClelland

26

The McClelland Financial Group

Assante Capital Management

Thornhill, ON

$444,707,197

18%

574

33

8

Kevin Hegedus

26

PWM Private Wealth Counsel

HollisWealth, Industrial Alliance Securities

Saskatoon, SK

$426,000,000

18%

847

36

9

Lyle Rouleau

20

Rouleau Investment Group

CIBC Wood Gundy

Edmonton, AB

$395,355,000

26%

150

10

10

Kyle Richie

18

Richie Group

Investors Group

Toronto, ON

$370,000,000

23%

350

20

11

Kash Pashootan

18

First Avenue Investment Counsel

N/A

Toronto and Ottawa, ON

$320,000,000

28%

210

15

12

Robert Luft

19

Luft Financial

HollisWealth, Industrial Alliance Securities

Vancouver, BC

$294,669,654

19%

505

23

13

Elie Nour

11

Nour Private Wealth

Manulife Securities

Oakville, ON

$231,000,000

18%

145

11

14

Nathalie Racine

23

The Racine-Marcotte Advisory Group

RBC Dominion Securities

Pointe-Claire, QC

$250,000,000

14%

350

50

15

Jamie Townsend

11

Lawton Partners

Lawton Partners Financial Planning Services

Winnipeg, MB

$265,617,422

9%

499

8

16

Joseph Nguyen

5

CIBC Imperial Service

CIBC Investor Services

Surrey, BC

$245,453,000

12%

998

74 100

17

Charlie Spiring

36

Wellington-Altus Private Wealth

Wellington-Altus Private Wealth

Winnipeg, MB

$250,000,000

0%

400

18

Mark Winson

30

Wise Riddell Financial Group

Aligned Capital Partners

Oakville, ON

$219,000,000

11%

117

3

19

Alexandra Horwood

7

Alexandra Horwood & Partners

Richardson GMP

Toronto, ON

$212,875,394

32%

171

0

20

David Barnsdale

30

The Barnsdale & Hussain Wealth Management Group

RBC Dominion Securities

Mississauga, ON

$209,000,000

16%

130

5

21

Paula Ives

20

Ives Wealth Management

RBC Dominion Securities

Edmonton, AB

$207,000,000

18%

225

25

22

David Christianson

35

Christianson Wealth Advisors

National Bank Financial

Winnipeg, MB

$202,000,000

7%

87

7

23

William Vastis

21

The William Vastis Wealth Management Group

RBC Dominion Securities

Toronto, ON

$230,000,000

-10%

117

20

24

Gerald L. Goertsen

16

De Thomas Wealth Management

N/A

Kelowna, BC

$188,748,852

35%

1454

195

25

Thierry Jabbour

8

Thierry Jabbour Financial Group

Manulife Securities

Montreal, QC

$185,000,000

19%

260

10

26

Wolfgang Klein

16

The Wolf on Bay Street

Canaccord Genuity Wealth Management

Toronto, ON

$183,268,000

22%

210

15

27

Rona Birenbaum

25

Caring for Clients

Queensbury Strategies

Toronto, ON

$182,000,000

23%

322

30

28

Kate Brown

13

Brown Wealth Management Group

RBC Dominion Securities

London, ON

$181,000,000

20%

184

12

29

Reez Sajan

4

CIBC Imperial Service

CIBC Investor Services

Coquitlam, BC

$165,068,404

6%

303

15

30

Luke Kratz

25

CIBC Private Wealth

CIBC Wood Gundy

Victoria, BC

$164,600,000

5%

174

11

31

Matt Wilhelm

26

Century Group Financial Solutions

Sun Life Financial

Kitchener, ON

$150,000,000

20%

1600

100

32

Brad Jardine

31

CIC Financial Group

Aligned Capital Partners

Ancaster, ON

$148,738,147

26%

338

44

33

Sean Harrell

18

Howe, Harrell & Associates

Quadrus Investment Services

Winnipeg, MB

$148,000,000

18%

321

9

34

Francis Sabourin

25

Sabourin Deraspe Wealth Management

Richardson GMP

Montreal, QC

$143,000,000

13%

85

10 12

35

Kevin Haakensen

20

PWM Private Wealth Counsel

HollisWealth, Industrial Alliance Securities

Saskatoon, SK

$142,000,000

18%

282

36

AJ Chase

23

AJ Chase Financial Group

ScotiaMcLeod

Hamilton, ON

$148,000,000

6%

217

7

37

John Rathwell

20

HollisWealth

HollisWealth, Industrial Alliance Securities

Red Deer, AB

$143,000,000

10%

420

22 12

38

Rosemary Horwood

4

Rosemary Horwood Wealth

Richardson GMP

Toronto, ON

$132,180,926

27%

106

39

Brian Lonsdale

22

Lonsdale Financial Group

CIBC Wood Gundy

Ottawa, ON

$136,000,000

14%

310

10

40

Daniel Noonan

21

Argosy Securities

Argosy Securities

Burlington, ON

$133,191,401

16%

740

68

41

Greg Milley

20

The Milley Team

HollisWealth, Industrial Alliance Securities

Oakville, ON

$136,000,000

5%

420

20

42

Laurie Bonten

31

Bonten Wealth Management

Wellington-Altus Private Wealth

Winnipeg, MB

$118,000,000

18%

220

40 21

43

Leo Belmonte

22

Security Financial Services & Investment

Security Financial Services & Investment

Toronto, ON

$116,112,000

11%

421

44

Steve Booker

20

Milestone Asset Management

Canaccord Genuity Wealth Management

Calgary, AB

$113,769,718

19%

283

5

45

Ronald Rusnak

14

Rusnak Financial

Manulife Securities

Bonnyville, AB

$115,000,000

9%

671

10 20

46

Sean Baylis

7

Baylis Wealth Management Group

RBC Dominion Securities

Calgary, AB

$107,508,000

22%

170

47

David J. Ritcey

25

The Ritcey Team

Scotia Wealth Management

Kentville, NS

$113,000,000

10%

218

5

48

Philip Boland

30

B&A Financial Group

HollisWealth Investia

Markham, ON

$109,255,324

9%

150

12

49

Douglas Griffioen

16

Wisdom Private Wealth

HollisWealth, Industrial Alliance Securities

Waterloo, ON

$104,135,000

9%

313

5

50

Jamie Suprun

16

Suprun Wealth Management

HollisWealth, Industrial Alliance Securities

Simcoe, ON

$93,920,282

20%

230

15

All asset numbers have been verified by the relevant compliance department

*As of October 31, 2017 †Between October 31, 2016 and October 31, 2017

www.wealthprofessional.ca

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25/01/2018 11:24:20 PM

FEATURES

SPECIAL REPORT JAMIE SUPRUN

PHILIP BOLAND

Suprun Wealth Management HollisWealth, Industrial Alliance Securities Simcoe, ON

B & A Financial Group HollisWealth Investia Markham, ON

48

Having added 12 new clients during 2017, Philip Boland now has 150 on his books. It’s a healthy number, but one he wants to increase in the year ahead. To facilitate that, he plans to add more members to his team at B & A Financial Group.

Those clients will likely be assigned to fee-based accounts, he says, in tune with the direction the advisory business is turning. Recognized as one of the top performers at HollisWealth in 2017, Boland also plans to further integrate smart technology into the client experience to enhance the capabilities of B & A Financial Group.

When asked what frustrates him most about being a financial advisor in Canada, Jamie Suprun is direct and to the point.

“Compliance, regulation, and competition from the banks,” he says. “Clients are completely unaware of the time constraints that regulation and compliance put on us as financial advisors. Most of my mornings are spent dotting i’s and crossing t’s. It’s too bad that a few bad eggs in the system have ruined the batch for the good advisors out there.”

49

DAVID J. RITCEY

47

The Ritcey Team Scotia Wealth Management Kentville, NS

DOUGLAS GRIFFIOEN Wisdom Private Wealth HollisWealth, Industrial Alliance Securities Waterloo, ON

The past year has been one of change for Douglas Griffioen as his Wisdom Private Wealth team was assimilated into the Industrial Alliance family as part of its takeover of HollisWealth. Regardless, he was still able to record AUM growth of $8 million, and he has similar expectations for 2018. Now in his 16th year as an advisor, Griffioen identifies time management as his major challenge. “[There are] so many demands on our time,” he says, “that it is hard to achieve a balance [when] taking clients in a very poor financial position and helping them turn it completely around.”

22

In today’s employment environment, it’s rare to find employees who stay with one company for very long, but after 25 years at ScotiaMcLeod, David Ritcey sees no reason to change. In fact, he’s confident his time with Scotia will continue for many more years. “I have committed to clients that I will not jump ship to a competitor,” he says. “I would like to have 40 years at Scotia.”

SEAN BAYLIS

46

Baylis Wealth Management Group RBC Dominion Securities Calgary, AB

Now in his seventh year as a financial advisor, Sean Baylis is clear on his targets for 2018, which include “improving our efficiency of operations and money management by converting my book to full discretionary wealth management, achieving vice-president status in the firm, and continuing to grow my business.”

Growth certainly wasn’t a problem for Baylis in 2017 – he increased his book of business by $19 million, which represented a jump of 22%. Now managing $107 million in assets, Baylis’ shift to discretionary management should entail even bigger numbers in the years to come.

www.wealthprofessional.ca

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25/01/2018 11:24:31 PM

RONALD RUSNAK

LAURIE BONTEN

45

Rusnak Financial Manulife Securities Bonnyville, AB

Representing the small town of Bonnyville, Alberta, Ronald Rusnak returns to WPC’s Top 50 Advisors list for the second year in a row with AUM growth of $9 million. Rusnak now manages a total of $115 million across 671 clients.

When discussing the most challenging aspects of the job, Rusnak highlights regulatory pressure – a common bugbear among his peers. “It’s being able to manage the ever-changing compliance field, as well as helping clients understand everything you do for them so that they can achieve their goals,” he says.

STEVE BOOKER 44 Milestone Asset Management Canaccord Genuity Wealth Management Calgary, AB

42

Bonten Wealth Management Wellington-Altus Private Wealth Winnipeg, MB

One of Wealth Professional Canada’s Women of Influence for 2017, Laurie Bonten is making her third appearance in a row on the Top 50 Advisors list. One of the founders of WellingtonAltus, she now manages $118 million in assets as part of the new Bonten Wealth Management Team. She intends for that number to grow in the year ahead as she adds more talent to her new enterprise.

“I would like to expand my client base now that we are at a new firm,” Bonten says. “I have taken on a junior associate to take over the smaller accounts while I concentrate on bigger assets and client retention/referrals.”

41

Providing financial guidance to independent business owners in Alberta, Steve Booker uses an S-curve formula for planning in order to “develop a framework that weeds out the external noise and allows [clients] to focus on wealth creation through thick and thin.”

In Booker’s opinion, his province still has some tough times ahead, which will make his services even more valuable. “Alberta has gone from having the lowest marginal tax rate to one of the highest,” he says. “Coupled with a protracted oil-induced recession, it can feel as though Alberta’s wealth has dried up, and business owners are exasperated.”

LEO BELMONTE 43 Security Financial Services & Investment Toronto, ON

The founder of Security Financial Services & Investment, Leo Belmonte is currently in the process of recruiting new advisory talent. At a time when job losses are a concern, it’s heartening to see that Belmonte’s business is proving to be such a success. Since starting the independent firm in 2005, he has increased his AUM more than fourfold to $116 million. Belmonte does foresee some headwinds, as he expects growth in stocks to plateau pretty soon. This will only increase the need for sound financial advice, however, which Belmonte and his growing team will be happy to provide.

GREG MILLEY The Milley Team HollisWealth, Industrial Alliance Securities Oakville, ON

The past year has been a productive one for Oakville-based advisor Greg Milley, and he expects more of the same for 2018. Having added $6 million to his personal book in 2017, he is thinking expansion for The Milley Team. “Our team is now seven people, and I have in place a succession plan for a senior advisor that should add another $20 million to the book,” Milley says. “One of the seven is himself a new advisor, and we will be increasing client support directly to him. In addition, we are looking to hire a client marketing communications professional in 2018.”

www.wealthprofessional.ca

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12/01/2018 7:23:59 AM

FEATURES

SPECIAL REPORT 40

ROSEMARY HORWOOD Rosemary Horwood Wealth Richardson GMP Toronto, ON

One of the youngest Top 50 Advisors – and a welcome presence in an industry in need of new talent to meet the needs of the millennial generation – Rosemary Horwood believes being relatively new to the business isn’t necessarily a disadvantage. “The proudest moment of my professional career was giving the acceptance speech after winning the Young Gun of the Year Award at the Wealth Professional Awards in 2016,” she says. “‘A baby shark is still a shark’ was my tagline for the speech, and it gave me the nickname ‘Baby Shark’ amongst my peers.”

DANIEL NOONAN Argosy Securities Burlington, ON

One of several Top 50 Advisors switching to a fully fee-based based practice, Daniel Noonan is currently in a transition period.

Now in his 21st year as an advisor, he is looking to reduce his number of clients, funnelling them to a junior associate to give himself more time to think about long-term strategies for the firm and focus on those clients he can help most. By repositioning himself, Noonan will undoubtedly remain a fixture of the Canadian wealth management industry for many years to come.

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BRIAN LONSDALE Lonsdale Financial Group CIBC Wood Gundy Ottawa, ON

Among financial advisors in Canada, fee-based versus commission has been an ongoing debate for years. There are strong arguments for both compensation models, but Brian Lonsdale believes the future of the business lies in a fee-based system. Currently his practice is split 50/50, but he intends to move to a more transparent fee-based model in the years ahead. Lonsdale added $17 million to his book in 2017; with a current AUM of $136 million, his firm is well positioned to grow as the industry evolves.

24

JOHN RATHWELL

37

HollisWealth, Industrial Alliance Securities Red Deer, AB

WPC’s Top 50 Advisors list is consistently dominated by those working in Canada’s main population centres, but there’s plenty of great advisory talent outside of the major cities, too. Case in point: John Rathwell, who serves the residents of Red Deer, Alberta, with a practice that has family at the forefront. All three of Rathwell’s adult children work in his office, and he describes the firm as “family helping families.”

Rathwell’s team is excelling in that regard, adding $13 million in assets last year to bring its total AUM to $143 million.

AJ CHASE

36

AJ Chase Financial Group ScotiaMcLeod Hamilton, ON

In the wealth management industry, less can be more, especially when it comes to clients. Overextending oneself can lead to decreased service, something AJ Chase and his team have taken steps to avoid. “Our primary goal is to continue to comply with CRM2 regulation by being transparent with fees and returns,” Chase says, “and by reducing our client base to provide a higher level of service – revenue increased by 15.6% by reducing households.”

In addition, using the new Scotia Wealth platform allows Chase to incorporate philanthropic, will and estate planning, private banking, and financial planning discussions into client meetings, which is popular with those who expect a multi-service package.

www.wealthprofessional.ca

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12/01/2018 7:24:17 AM

KEVIN HAAKENSEN 35 PWM Private Wealth Counsel HollisWealth, Industrial Alliance Securities Saskatoon, SK

Alongside fellow Top 50 Advisor Kevin Hegedus, Kevin Haakensen has built PWM Private Wealth Counsel in one of the top advisory firms in the Prairies. That has entailed lots of hard work, but Haakensen says it’s also been a hugely enjoyable journey. “As I reflect back on the last 20 years of my career, I have several emotions,” he says. “The two largest are a huge sense of satisfaction and pride for the amount of people who have been helped through our practice in the last several decades, and also the number of fantastic employees that I have known and helped reach some of their goals of financial security.”

www.wealthprofessional.ca

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12/01/2018 7:29:14 AM

FEATURES

SPECIAL REPORT 34

33 SEAN HARRELL Howe, Harrell & Associates Quadrus Investment Services Winnipeg, MB

Next year, Winnipeg-based advisor Sean Harrell will mark his 20th anniversary as a financial advisor, but his long tenure in wealth management hasn’t diluted his passion for the job. “At 41, I still have a few more years to go,” he says. “That’s OK with me – I don’t wake up dreading going to work. It’s quite the opposite; after a few days off from work, I’m ready to get back to it.”

Such dedication usually goes along with running your own business, a milestone Harrell achieved when he opened Howe, Harrell & Associates in 2012, which considers the highlight of his career so far.

BRAD JARDINE

32

CIC Financial Group Aligned Capital Partners Ancaster, ON

FRANCIS SABOURIN Sabourin Deraspe Wealth Management Richardson GMP Montreal, QC

Having an advisor with knowledge of international markets can be a real advantage for investors, and Francis Sabourin has developed a pristine reputation as an advisor with his finger on the pulse of investment opportunities not only in Canada, but worldwide. This ability saw him named Global Advisor of the Year for the second year in a row at the 2017 Wealth Professional Awards. Providing discretionary portfolio management for his clients, Sabourin also boosted his assets by $17 million in 2017, bringing his total AUM to $143 million.

26

Marking his 32nd year in the advisory business in 2018, Brad Jardine returns to the Top 50 Advisors list for the third year in a row. Having built an impressive $148 million book of business at CIC Financial Group, Jardine now takes on select clients by referral only.

Although he has more than three decades in wealth management under his belt, Jardine admits that the job remains challenging, particularly when it comes to increased regulatory pressure. It’s a role he still enjoys, however, particularly now that his son, Spencer, is working alongside him at CIC Financial Group.

www.wealthprofessional.ca

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12/01/2018 7:29:29 AM

MATT WILHELM

LUKE KRATZ

31

30

CIBC Private Wealth CIBC Wood Gundy Victoria, BC

Century Group Financial Solutions Sun Life Financial Kitchener, ON

Matt Wilhelm certainly likes to keep himself busy – he added 100 new clients over the past year, bringing his total count to 1,600 – the highest among this year’s Top 50 Advisors by far. Wilhelm also increased his AUM by $25 million in 2017.

Although he has a significant number of clients, Wilhelm prides himself on maintaining strong bonds with them. He says one of his career highlights has been “being thanked by the children of recently deceased clients for doing such a great job for their parents for 25 years.”

This year marks Luke Kratz’s fourth consecutive appearance on the Top 50 Advisors list, and it’s an achievement he puts a lot of stock in. “I have been fortunate to have been selected by WPC as a Top 50 Advisor in each of the previous three years,” he says. “This is an incredible feat for any advisor, but for me, I have been fortunate to continually grow my business – assets, recurring revenue and recurring revenue per client – while shrinking the number of clients that I serve.” Over the past year, Kratz has disengaged unprofitable clients in order to concentrate on those that will drive business in 2018, bringing his current client count to 174.

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– Series F Since Inception 1 Year 3 Years 5 Years 10 Years (12/12/2005) Morningstar Quartile Ranking*

1

1

1

1

1

*As of November 30, 2017. Morningstar Research Inc. A quartile is used to describe a small group composed of 25% of a larger group. The performance of Templeton Global Balanced Fund Series F is ranked in the top 25% of the Morningstar Tactical Balanced category over one year (91st out of 391 funds), three years (22nd out of 234 funds), five years (5th out of 169 funds) and ten years (4th out of 35 funds).

The indicated rates of return are historical annual compounded total returns, including changes in unit value and reinvestment of all distributions and do not take into account sales, redemption, distribution or optional charges or income taxes payable by any security holder that would have reduced returns. Commissions, trailing commissions, management fees and expenses all may be associated with mutual fund investments. Please read the prospectus or fund facts document before investing. Series F is available to investors participating in programs that do not require Franklin Templeton to incur distribution costs in the form of trailing commissions to dealers. As a consequence, the management fee on Series F is lower than on Series A. Mutual funds are not guaranteed; their values change frequently and past performance may not be repeated. As of November 30, 2017, the historical annual compounded rates of return for Series F units of Templeton Global Balanced Fund are: 1 year 10.34%; 3 years 7.33%; 5 years 10.62%, 10 years 6.69% and 6.90% since inception December 12, 2005. These include changes in unit value and reinvestment of all distributions but do not take into account sales, redemption, distribution or optional charges or income taxes payable by any unit holder which may have reduced returns. © 2017 Franklin Templeton Investments Corp. All rights reserved.

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04/01/18 15:08

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12/01/2018 7:29:42 AM

FEATURES

SPECIAL REPORT REEZ SAJAN

29

WOLFGANG KLEIN

CIBC Imperial Service Coquitlam, BC

It’s increasingly important for advisors to enhance their value proposition for clients. Although a relative newcomer to the business, Reez Sajan is well aware of that fact, and he believes technology will allow advisors to add value going forward.

“I believe the space will become more augmented with AI, technological aids and assistance to help us work more efficiently while continuing to provide the human touch,” he says.

Lower fees are another important issue for clients, so Sajan has committed to offering the best possible service at an affordable level.

KATE BROWN

28

Brown Wealth Management Group RBC Dominion Securities London, ON

The Wolf on Bay Street Canaccord Genuity Wealth Management Toronto, ON

Marking another year on WPC’s Top 50 Advisors list, Wolfgang Klein continues to produce the returns his clients expect. For 2018, he forecasts returns of 5%, 7% and 9% for his conservative, balanced and growth accounts. His growth mandate has produced a 13% gross return since inception, which is a point of pride for the Toronto-based advisor.

“You need scale and performance and must deliver value in terms of returns and other services provided,” he says. “Small [advisors] – i.e. assets under $50 million and revenue below $500,000 – are under attack, and this bar shall be raised eventually to $100 million in assets and $1 million in production.”

The greatest transfer of wealth in Canada’s history will take place over the next two decades, which means forward-thinking advisors like Kate Brown are already adding millennial clients. “Over the past year, I have been asked by five of my clients to connect with their millennial-aged children to help them get started on the right financial path,” Brown says.

Looking to 2018, she has targeted 15% growth in both AUM and net revenue over the coming year.

RONA BIRENBAUM

27

Caring for Clients Queensbury Strategies Toronto, ON

It’s been a year to remember for Rona Birenbaum. Caring for Clients was recognized as the Best Advisory Team at the 2017 Wealth Professional Awards, which Birenbaum considers to be a career highlight. “It was a team award, 17 years in the making, and I’ll never forget that moment,” she says.

Running an independent practice is a difficult task in 2018, and Birenbaum acknowledges that it’s only getting more challenging. “Advisors must invest heavily in service and valueadded advice to justify the fees clients pay for a full-service relationship,” she says.

28

25

THIERRY JABBOUR Thierry Jabbour Financial Group Manulife Securities Montreal, QC

Making his second consecutive appearance on the Top 50 Advisors list, Montreal-based advisor Thierry Jabbour sees his current role as one for life. “I will be managing my clients’ assets for the next 40 years or more,” he says.

With eight years already under his belt, Jabbour is planning for the long term. “To run a successful financial business in 2018, we have to keep up with changing market trends and market dynamics,” he says. “This is why it is important to have access to extensive research and to hire and retain the proper personnel.”

www.wealthprofessional.ca

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12/01/2018 7:30:02 AM

GERALD L. GOERTSEN

24

De Thomas Wealth Management Kelowna, BC

It’s no secret that most Canadians need to save more for retirement, and it’s a key part of an advisor’s job to guide such matters. For Gerald Goertsen, retirement planning can be a highly complex and intricate part of the job, but also an area where he can really add value. “I love helping families achieve their goals,” he says.

“I think the proudest moment is when I am able to tell a client who was worried about retirement that they need to spend more money.”

www.wealthprofessional.ca

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12/01/2018 7:30:17 AM

FEATURES

SPECIAL REPORT WILLIAM VASTIS

23

The William Vastis Wealth Management Group RBC Dominion Securities Toronto, ON

A 21-year veteran of the business, William Vastis has managed wealth for many different clients during his career, but one case in particular sticks out in his mind. “I was assisting a family facing tremendous nepotism within stakeholders,” he says, “and it was looking like a breakdown in business and relationships.” It’s a scenario familiar to anyone who deals in estate planning, but in this case, Vastis’ guidance averted a familial breakdown. “I was able to help mitigate the relationships before it got out of hand and avoid lawsuits and divorces,” he says. “The business is currently transitioning to the third generation, which is quite exciting.”

PAULA IVES

21

Wealth management is often criticized for being far too maledominated, and the fact that the proportion of female wealth in Canada is set to rise substantially over the next decade has only served to highlight the issue. The industry needs more advisors of the calibre of Paula Ives, who added $32 million to her AUM in 2017 and plans to add another $50 million this year. In addition, Ives participates in WAMCAN, a financial literacy initiative with the City of Edmonton that helps women improve financial literacy and money management.

20

The Barnsdale & Hussain Wealth Management Group RBC Dominion Securities Mississauga, ON

It’s been a good year for David Barnsdale – 16% AUM growth brought his book of business to $209 million. But rather than resting on his laurels, Barnsdale already has his targets for 2018 firmly in sight: He aims to complete the AFDS course to become a Chartered Financial Divorce Specialist [CFDS], which should prove useful in the pursuit of his other goal to increase his personal AUM by 20%. Outside of the office, Barnsdale’s main ambition will be taking part in the Ride to Conquer Cancer charity event for the fifth consecutive year.

30

19

Alexandra Horwood & Partners Richardson GMP Toronto, ON

One of Wealth Professional Canada’s 2017 Women of Influence, Alexandra Horwood returns to the Top 50 Advisors list for the second year in a row. Coming from a family of advisors, Horwood sets the bar pretty high for herself and her team. “My goal for 2017 was to reach $2 million in recurring T12 [trailing 12-month] revenue and $200 million in AUM,” she says, “and I achieved that goal in September 2017. My long-term goal is always to achieve $1 billion in AUM or $10 million in recurring revenue, and to be number one in my firm, Richardson GMP.”

MARK WINSON

18

Wise Riddell Financial Group Aligned Capital Partners Oakville, ON

Ives Wealth Management RBC Dominion Securities Edmonton, AB

DAVID BARNSDALE

ALEXANDRA HORWOOD

A year in which he grew his assets under management by $21 million – an 11% increase on 2016 – couldn’t be considered anything other than a huge success for Mark Winson. The Oakvillebased advisor just celebrated his 30th year in wealth management, but he’s looking ahead with some big plans for the future. Specifically, he intends to move to a discretionary platform and integrate a new partner, James Simon, into his practice in 2018. Winson also recently welcomed his daughter to the growing team at Wise Riddell Financial Group, which he identifies as a career highlight.

CHARLIE SPIRING

17

Wellington-Altus Private Wealth Winnipeg, MB

With 36 years in the business under his belt, Charlie Spiring is the most experienced of this year’s Top 50 Advisors. He has witnessed wealth management evolve, and with it the role of the financial advisor.

Spiring remains hungry for a challenge, however – so much so that he formed his own firm, Wellington-Altus Private Wealth, in April 2017. The company now manages approximately $2.5 billion in assets, but that’s hardly surprising, considering its founder’s history: Spiring previously founded Wellington West Holdings and oversaw that firm’s growth until it was eventually acquired by National Bank Financial in 2011.

www.wealthprofessional.ca

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12/01/2018 7:30:35 AM

DAVID CHRISTIANSON

22

Christianson Wealth Advisors National Bank Financial Winnipeg, MB

A 35-year veteran of the advisory business, David Christianson has been a constant presence on WPC’s Top 50 Advisors list.

The reason for that Christianson’s consistency, both in growing his assets under management and in his ability to retain and attract new clients.

Spending three decades in one profession is an achievement in itself, but to do so at such a high level is what sets Christianson apart. In 2018, he plans to merge Christianson Wealth Advisors with another successful advisory team as he prepares to pass the torch to the next generation.

www.wealthprofessional.ca

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12/01/2018 7:30:58 AM

FEATURES

SPECIAL REPORT JOSEPH NGUYEN

16

One of the younger advisors among this year’s Top 50, Joseph Nguyen has nevertheless been able to amass $245 million in AUM during his four years as an advisor. In an industry that can be tough on new entrants, Nguyen’s early success is all the more commendable. Currently studying to obtain his CFP, Nguyen received both the CIBC Award of Distinction and CIBC Annual Achievers Award in 2016.

15

Lawton Partners Lawton Partners Financial Planning Services Winnipeg, MB

Being a financial advisor can sometimes be a thankless task, especially if the markets aren’t cooperating, but it can also be very rewarding. Just ask Winnipeg-based advisor Jamie Townsend, who relishes working on complex business transitions, which often include creating new shareholder agreements that are backstopped by proper insurance coverage, as well as formulating a business plan to help guide the new owners. “It’s the moment where all the planning comes to fruition,” he says, “when we help a business transition from one generation to the next, negotiating the buyout terms and assisting in financing arrangements.”

NATHALIE RACINE

14

The Racine-Marcotte Advisory Group RBC Dominion Securities Pointe-Claire, QC

In Nathalie Racine’s view, being a financial advisor is more than just a job. “We love what we do,” she says.

“It’s not a job; it’s a lifestyle.”

A 23-year veteran of the business, Racine has observed how the advisor’s role has shifted over the years. Technology has no doubt enhanced advisors’ capabilities, but Racine believes faceto-face interaction is still crucial. “It’s very important to keep the personal touch with clients through one-on-one meetings and not letting technology take over the relationship,” she says.

32

13

Nour Private Wealth Manulife Securities Oakville, ON

CIBC Imperial Service Surrey, BC

JAMIE TOWNSEND

ELIE NOUR

A fixture on the Top 50 Advisors list since 2014, Elie Nour finds himself among Canada’s elite advisory talent again in 2018. Nour is no stranger to awards – he has ranked among Manulife Securities’ top 1% since 2009 – but he says his two youngest brothers following him into the advisory business has been one of his proudest professional moments.

Now in his 11th year as a financial advisor, Nour has his own ideas about what the job should entail. “Today, clients need and expect more than just a money manager,” he says. “Clients are looking for advisors who can provide guidance in areas such as tax and estate planning.”

ROBERT LUFT

12

Luft Financial HollisWealth, Industrial Alliance Securities Vancouver, BC

When a business reaches a certain size, it becomes much more difficult to maintain high growth levels. But even though Robert Luft had AUM of close to $250 million in 2016, he still managed to achieve double-digit growth in 2017, bringing his assets under management to just over $294 million. He has his sights set on breaching the $300 million threshold in 2018 and adding 30 new clients to his book. That would bring his client count to 535 – a significant undertaking, but one where Luft believes his team can still deliver a high level of service.

KASH PASHOOTAN First Avenue Investment Counsel Toronto/Ottawa, ON

Returning to the Top 50 Advisors list for a second consecutive year, Kash Pashootan has had an eventful 12 months. His firm, First Avenue Advisory, became First Avenue Investment Counsel, offering high-net-worth clients discretionary portfolio management. Pashootan also increased his assets under management by 28%. Now with $320 million in AUM, Pashootan heads into the new year with every intention to add significantly to that number. He is also a regular commentator on BNN, discussing investment trends and performance.

www.wealthprofessional.ca

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12/01/2018 7:31:07 AM

KYLE RICHIE

10

8

Richie Group Investors Group Toronto, ON

With an impressive $370 million in AUM, Kyle Richie finds himself among Canada’s top 10 advisors after adding $70 million to his book of business over the past year. That doesn’t mean his ambition has dulled, however – quite the opposite, in fact. “From a business standpoint, we would like to hit $500 million AUM in the next year,” Richie says. “From a client perspective, we would like to stay ahead of the curve, especially given the recent budget proposal.”

The tax changes in the upcoming budget will undoubtedly put Richie’s tax planning skills to good use. He has built his practice by providing financial guidance to high-net-worth clients, primarily doctors and dentists. Professionals in those fields tend to have assets, but not the time to manage them, which is where the Richie Group comes in. “Reducing fees is a must, and we must adapt to this change,” Richie says. “The question we should all ask is: What are we doing other than managing money for clients?”

Richie has been named Investors Group’s number-one advisor in Canada for 10 years in a row, which suggests he is more than meeting the expectations of his clients. Like most of this year’s Top 50 Advisors, he believes his team’s success comes through effective collaboration. “I have the best associate/business partner in Andrew Feindel,” Richie says. “He’s been with me since 2004, and we have grown our assets organically from $15 million to $370 million in 13 years.”

LYLE ROULEAU

9

Rouleau Investment Group CIBC Wood Gundy Edmonton, AB

The head of Rouleau Investment Group, Lyle Rouleau is making his fifth consecutive appearance on WPC’s Top 50 Advisors list. He increased his AUM by more than $80 million, or 26%, in 2017, which catapulted him into the top 10 this year. His enviable ranking comes as he celebrates a milestone birthday and plans for another successful year with his advisory team. “I will be turning 50 in January and can see myself still working as an advisor in 10 years,” Rouleau says. “It may be in a reduced capacity or a reduced number of hours, but we will see where the road takes me.”

Currently marking his 20th year as a financial advisor, Rouleau values the impact this job can have on people’s lives, which is a key reason why he enjoys his work so much. “Being in the business for 20 years has allowed me to see financial plans come into fruition,” he says, “whether it is seeing parents putting their kids through university with their RESP contributions, clients retiring and utilizing their portfolios to exceed their needs, or unfortunately having clients’ life insurance fulfil their estate planning needs.”

KEVIN HEGEDUS PWM Private Wealth Counsel HollisWealth, Industrial Alliance Securities Saskatoon, SK

Kevin Hegedus returns to the Top 50 list this year, landing once again in the top 10. Hegedus increased his AUM by $66 million over the past year, and he has business-building firmly in mind for 2018.

“From a growth perspective, my goal is to bring in $40–$50 million in new assets without a book purchase,” he says. “This has been our goal for a number of years now and something that we have been able to attain.”

The team at PWM Private Wealth Counsel is also looking at purchasing new books of business and has a number of options in the pipeline. Such expansion doesn’t always come easy, though, and requires the right planning in order to be a success. “I recently reached out to a coach with over 10 years of experience working with very large advisor firms in the US, specializing in running more efficient and profitable practices and elevating the client experience,” Hegedus says. “I am hoping to take our client experience to a new level in the coming year.”

That means providing the myriad services that clients have come to expect from wealth management. The most successful practices are those that provide answers to many different questions, and Hegedus has every intention of building PWM into one of Canada’s top independent firms. “You have to build a practice that takes a more holistic approach, where you are addressing not only wealth management, but tax, insurance, succession and philanthropic issues as well,” he says. “This is the only way clients will be able to get past the fee-driven mindset and be able to see the true value that an advisor offers.”

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FEATURES

SPECIAL REPORT 7

ROB McCLELLAND

Popowich Karmali Advisory Group CIBC Wood Gundy Calgary, AB

The McClelland Financial Group Assante Capital Management Thornhill, ON

In wealth management, consistency is key. It’s a quality Rob McClelland has displayed throughout his career, which is why he has been able to build a book of business approaching $445 million. The Thornhill, Ontariobased advisor has shown similar qualities when it comes to his five appearances on WPC’s Top 50 Advisors list. Last year he was ranked eighth, and he moves up one spot for 2018.

McClelland has already set a number of targets for the new year, including $50 million in new assets, more than $5 million in gross revenue for his team and completing more than 200 tax returns for his clients. To achieve that, he plans to upgrade his software system, becoming 100% cloud-based, while increasing his business from 96% to 98% fee-based.

While McClelland is confident he can achieve those goals, there are headwinds in the investment space that can’t be ignored. The end of the current bull market looms on the horizon, as does the ever-present issue of further regulation.

However, McClelland is fully prepared to face these challenges head-on. “The industry is moving to fee-based, and that is causing issues for those late to the game,” he says. “CRM2 has only helped to confuse some clients, so until CRM3 is complete, it is not a level playing field.”

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FAISAL KARMALI

Celebrating a decade in the advisory business this year, Faisal Karmali marks the occasion with his first appearance on Wealth Professional Canada’s Top 50 Advisor list. The fact that he’s making his debut in sixth place – after accumulating assets of $450 million – is even more impressive. Serving 464 clients, Karmali has shifted his business to a fully discretionary model, which has proven popular with the families he provides financial advice to in Calgary. “Clients want to understand the products,” he says, “and they want to know how and why an investment fits into the big picture for them.”

It’s a challenging role, but one that still brings him a great deal of pleasure. In particular, Karmali enjoys the ability to really make a difference in people’s lives, particularly when it comes to their golden years. “The best part of my job is helping clients ensure that their lifestyle never retires,” he says. “It is working with my clients on four main areas of growth, income, health and legacy, while incorporating a tax-minimizing strategy.”

In that respect, he believes the role of a financial advisor has evolved so that it’s less about investment products and more about proper financial planning. “The product for the client is not the first conversation,” he says. “In fact, in my practice, it comes down at the bottom of the list.”

REG JACKSON

5

JMRD Wealth Management Team National Bank Financial London, ON

London, Ontario-based advisor Reg Jackson returns to the 2018 Top 50 Advisors list with a place in the top five. Jackson stands out from his peers with assets under management of $525 million, boosted in 2017 by growth of $50 million.

Although it’s his personal performance that landed him on the list, Jackson is keen to highlight that the success of JMRD Wealth Management is very much a team effort.

“By far the proudest moment of my career was when the JMRD Wealth Management Team won the 2013 National Award for Wealth Management Excellence at National Bank Financial,” he says. “Our business is not about individuals, and no single advisor can provide all the areas of expertise that clients want and demand in today’s competitive landscape.”

The JMRD collective consists of 11 professionals across three offices, which allows a greater degree of specialization. In Jackson’s opinion, providing a full spectrum of services – including ones that cater specifically to millennials – is the biggest challenge facing advisors today.

“I fully expect to be working as a financial advisor in 10 years, but my job description and the products and services being offered may look very different,” he says. “Tomorrow’s client will be completely different and will be asking for and expecting far more. Millennials are reshaping how we think about the future, and their preferences and demands will dictate our industry significantly.”

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LARRY SHORT

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ShortFinancial HollisWealth, Industrial Alliance Securities St. John’s, NL

The sole representative of Newfound­ land on the Top 50 Advisors list, Larry Short made it into the top five after boosting his AUM by $90 million in 2017. Any advisor who can increase his book of business by 70% over a 12-month period deserves acclaim, and this veteran is no different. “I started 29 years ago and was called a stockbroker,” Short says. “Now we complete full financial plans, and I operate as a portfolio manager. Clients have higher expectations, and we have more extensive capabilities than we had years ago to meet their needs.”

Subscribing to the belief that a rising tide lifts all boats, Short says the advisory business is in a much better position now than when he started in the late ’80s. “Professionalism in the industry has increased dramatically,” he says. “When I was hired, many advisors came from sales backgrounds. Now recruitment is much more geared toward ethically minded, disciplined investment advisors.”

It’s also a job that still brings him great satisfaction. “I have seen many clients start with little, build a great life for their family and community, and leave a great legacy,” Short says.

“Watching that happen – seeing value created from hard work and contributing in a small way to that – is a real thrill.”

BRAD MOORE

3

SAGE Connected Investing Raymond James Calgary, AB

With 34 years as a financial advisor under his belt, Brad Moore sets the standard for his team at SAGE Connected Investing. Moore had the highest annual growth rate – 85% – of this year’s Top 50 Advisors, which brought his assets under management to $244 million, divided among 274 clients.

His client base continues to expand each year as well, bringing both challenges and opportunities. “They have become more demanding because they too have access to much of the same info and tools as we do,” Moore says. “You have to add value, or they will logically do it themselves. At the same time, many are overwhelmed by it all and therefore feel the need for a professional more than ever.”

Part of Raymond James, one of the top wealth management firms in the world, SAGE appears to be in safe hands. That isn’t the case for every firm, however, as Moore points out.

“Independent firms are being squeezed with excessive compliance-related obligations,” he says. “The immense amount of money going into passive investments like ETFs and benchmark/index funds is very concerning. Investors, and society as a whole, pay a price when capital is allocated based on current market capitalization rather than true productive value.”

ROB TETRAULT Tetrault Wealth Advisory Group National Bank Financial Winnipeg, MB

Rising from ninth place last year to second in 2018, Rob Tetrault increased his AUM by more than 50% over the past 12 months.

Coming into the business after first practicing law, he has built an enviable reputation during his eight years as a financial advisor. Tetrault brought in 115 new clients in 2017, and he intends for the coming year to be similarly busy. “My business goals are to grow assets under management by another $100 million, to host six quality events, to continue having strong riskadjusted return performance numbers, to grow my social media presence and to continue having a strong 99%+ client retention rate,” he says.

And that’s just the beginning. While more tenured advisors are beginning to wind down their careers, Tetrault has ambitious plans for the future of the Tetrault Wealth Advisory Group. “In 10 years I see myself managing over a billion dollars and having a strong staff dedicated to clients and their well-being, with a focus on holistic wealth management through the proper use of high-level planning tools.”

A CIM holder, Tetrault believes his ability to trade on a discretionary basis gives him a competitive advantage over many of his peers. Advisors today are under much more pressure to prove their worth, but Tetrault believes this is the kind of pressure that is healthy for the industry. “Obviously, competition is coming at us from all directions, including fintech and independents, which has caused some fee compression in our industry,” he says. “It becomes ever more important for advisors to demonstrate their worth to clients in more ways than simply good portfolio management.”

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FEATURES

SPECIAL REPORT

CHAD LARSON

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MLD Wealth Management Group National Bank Financial Calgary, AB

Now in his 14th year as a financial advisor, Chad Larson finds himself at the top of this year’s Top 50 Advisors list. Rising from third place last year, the Calgary-based PM saw his AUM grow 24% over the past 12 months to $776 million, and he intends to stay on that path in the coming year. “We will continue to enhance client engagement with our multi-family office platform, continually enhancing and leading the industry in full-cycle, holistic wealth management and family office services,” he says.

Adding 40 new clients over the past year, Larson takes pride in the fact that he has achieved organic business growth by putting an emphasis on bespoke service. “Too often scale is pursued via product and not process,” he says. “We will continue to invest in process and people. True scale will be reached with enhanced offerings, using digital tools for client engagement and loyalty.”

While his industry experience puts Larson into veteran

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territory, he still finds himself at the younger end of the advisor spectrum. Regardless, he has observed how the role has changed over the years. “Clients are more informed, and mediocrity has no chance,” he says. “Conversations have changed – they are about the ‘why,’ not the ‘how.’ The conversations are about family, occupation and recreation – that’s the ‘why’; the ‘how’ is that they entrust us to be stewards of their capital.”

As for the industry as a whole, Larson believes the evolution of wealth management will likely lead to fewer firms, which could be a double-edged sword for clients. “There is absolutely a trend of attrition and consolidation,” he says. “We feel this is both a positive and negative. Positively, the platforms have become stronger and more robust, but a negative is that there are some parts of the business that have lost agility.”

As the ‘L’ in MLD Wealth Management Group, Larson prefers to share the credit for the practice’s success. “It is truly a team approach, with many partners and stakeholders, internal and external,” he says. “They are enlightened, aligned and empowered about driving excellence and client engagement; watching and receiving feedback from families by providing insight and clarity is a massive reward.”

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12/01/2018 7:32:03 AM

Old school fundamentals.

New school strategy.

Old school fundamentals meet new school strategy.

BMO Shiller Select US Index ETF (ZEUS) stays ahead of the curve by investing in old standbys.

To learn more visit bmo.com/shillerETF

BMO Global Asset Management is a brand name that comprises BMO Asset Management Inc., BMO Investments Inc., BMO Asset Management U.S. and BMO’s specialized investment management firms. BMO ETFs are managed and administered by BMO Asset Management Inc., an investment fund manager and portfolio manager and separate legal entity from the Bank of Montreal. Commissions, management fees and expenses all may be associated with investments in exchange traded funds. Please read the prospectus before investing. The funds are not guaranteed, their values change frequently and past performance may not be repeated. ® BMO (M-bar roundel symbol) is a registered trade-mark of Bank of Montreal.

The Shiller Barclays CAPE® US Single Stock Index is the intellectual property of Barclays Bank PLC and has been licensed for use in connection with the of BMO Shiller Select US Index ETF. The BMO Shiller Select US Index ETF is not sponsored, endorsed, sold or promoted by Barclays Bank PLC or any of its affiliates. Neither Barclays Bank PLC nor any of its affiliates makes any representations or warranties to holders of the of BMO Shiller Select US Index ETF or any member of the public regarding the advisability of investing in the of BMO Shiller Select US Index ETF.

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12/01/2018 7:32:31 AM

SPECIAL PROMOTIONAL FEATURE

ETFS

A valueoriented approach Kevin Prins of BMO ETFs explains why he believes the ETF industry’s best days are still ahead

AS ETFs in Canada continue to go from strength to strength, BMO Global Asset Management takes great pride in being a driving force behind the industry’s expansion. When the institution entered the ETF space back in 2009, it was alone among the Big Six banks in doing so. That show of faith has been richly rewarded since then, as ETFs have grown into a $140 billion-plus market in this country. BMO accounts for just over 31% of that amount, making it the second largest provider in Canada, but it is gaining fast in terms of market share and was the best-selling ETF provider 2017.

Kevin Prins, managing director and head of Distribution, ETFs and Managed Accounts for BMO Global Asset Management Canada, has observed closely how the industry has blossomed over the past decade.

Double-digit growth has become the norm in recent years, and despite some fears of oversatu­ ration, ETFs in Canada show no sign of slowing down.

“It is a much broader market now,” Prins says. “It’s not just retail advisors, end investors, or institutional names like pension funds and endowments – it is all of those coming together. The one thing I always

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highlight is that this is the one place where there is a level playing field, regardless of the participant.”

With investors of all stripes now getting behind ETFs, the industry continues to grow at a rapid pace, and Prins believes it will continue to do so for the foreseeable future.

“We recognized early that ETFs were really good tools for portfolio construction,” he says. “They are low-cost, diversified solutions that provide transparency, so we have been educating advisors ever since on the benefits ETFs can bring to any portfolio.”

Most recently, BMO ETFs launched five new ETFs, now offering 70 mandates. The BMO MSCI Canada Value Index ETF (ZVC), BMO MSCI EAFE Value Index ETF (ZVI), BMO MSCI USA Value Index ETF (ZVU) and BMO High Yield US Corporate Bond Index ETF (ZJK) were joined by the BMO Shiller Select US Index ETF (ZEUS).

The BMO Shiller Select ETF stands out in the Canadian marketplace by offering access to the Cyclically Adjusted Price Earnings [CAPE] methodology of Professor Robert Shiller.

“We have a pretty broad product line with 70 different exposures and 95 different list-

ings,” Prins says. “We have the largest fixed-income ETF in Canada, the largest unhedged S&P 500, largest MSCI EAFE, largest Nasdaq, but we are not just in those traditional areas. We have done well in smart beta, where we are the largest in Canada for ETFs and 12th in the world.”* In Prins’ view, such products are a testament to BMO’s commitment to innovation.

The firm became an ETF powerhouse in Canada through its traditional indextracking products, which remain the cornerstone of its business today. But that doesn’t mean it has neglected the more niche segments of the market – ones that investors are increasingly attracted to.

Value investing is one area BMO is

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“We are looking at all-time highs for the value of companies,” he says, “so a value approach towards investing allows an advisor to buy into companies at a lower value. Value is an area that wasn’t offered in a format people wanted to expose themselves to, so that’s what we like about our new value ETFs.” While ETFs are clearly an important part of BMO’s business, that doesn’t mean the institution is moving away from mutual funds. The two investment vehicles complement each other, explains Prins, adding that advisors should go for the best of both worlds when constructing a portfolio.

“A lot of the industry looks at mutual funds versus ETFs, but what we do differently is mixing funds and ETFs,” he says. “I see the two coming closer and closer together, and we have become very strong advocates of mixing active and passive investing.

“In financial services, BMO is known for innovation – managed accounts with Nesbitt Burns and Smartfolio more recently,” he adds.

“The key for us is taking a look at where the market is going and putting our full commitment behind it when we go there.” *Source: BMO Asset Management

“A lot of the industry looks at mutual funds versus ETFs, but what we do differently is mixing funds and ETFs. I see the two coming closer and closer together, and we have become very strong advocates of mixing active and passive investing” Kevin Prins, BMO ETFs looking to as it brings new products to market. There are now 27 providers and more than 600 ETF listings in Canada*, so launching products that offer investors

something new has become increasingly challenging. That challenge is what drives BMO, explains Prins, and is why it has tasted such success in its ETF business.

The exchange-traded funds or securities referred to herein are not sponsored, endorsed or promoted by MSCI, and MSCI bears no liability with respect to any such funds or securities or any index on which such funds or securities are based. The prospectus contains a more detailed description of the limited relationship MSCI has with BMO Asset Management Inc. and any related funds. The Shiller Barclays CAPE US Single Stock Index is the intellectual property of Barclays Bank PLC and has been licensed for use in connection with the BMO Mutual Funds and BMO ETFs. The BMO Mutual Funds and BMO ETFs are not sponsored, endorsed, sold or promoted by Barclays Bank PLC or any of its affiliates. Neither Barclays Bank PLC nor any of its affiliates makes any representations or warranties to holders of the BMO Mutual Funds and BMO ETFs or any member of the public regarding the advisability of investing in the BMO Mutual Funds and BMO ETFs. The Shiller Barclays CAPE Single Stock Index Family has been developed in part by RSBB-I, LLC, the research principal of which is Robert J. Shiller. RSBB-I, LLC is not an investment advisor, and does not guarantee the accuracy or completeness of the Shiller Barclays CAPE Single Stock Index Family, or any data or methodology either included therein or upon which it is based. Neither RSBB-I, LLC nor Robert J. Shiller shall have any liability for any errors, omissions, or interruptions therein, and makes no warranties, express or implied, as to performance or results experienced by any party from the use of any information included therein or upon which it is based, and expressly disclaims all warranties of merchantability or fitness for a particular purpose with respect thereto, and shall not be liable for any claims or losses of any nature in connection with the use of such information, including but not limited to, lost profits or punitive or consequential damages, even if RSBB-I, LLC is advised of the possibility of same. Commissions, management fees and expenses all may be associated with investments in exchange traded funds. Please read the prospectus before investing. Exchange-traded funds are not guaranteed, their values change frequently and past performance may not be repeated. ®BMO ETFs are managed and administered by BMO Asset Management Inc., an investment fund manager and portfolio manager and separate legal entity from Bank of Montreal.

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12/01/2018 5:54:35 AM

PEOPLE

ADVISOR PROFILE

Discovery process Matthew Rodier, winner of the IIAC’s Top Under 40 Award, discusses what it takes for a young advisor to build a successful practice RECOGNIZED BY the Investment Industry Association of Canada with its 2017 Top Under 40 Award, Matthew Rodier knows firsthand how hard it is to build a thriving advisory practice. With 15 years at TD to his name, he now heads Rodier Asset Management, but hasn’t forgotten all it took for him to get there.

“It’s an extremely difficult business to get into as a young advisor,” he says. “I was in my mid-20s when I started; approaching people as old as your parents, trying to establish a rapport – it’s very challenging.

But if you have the right work ethic, have the right strategy, are organized and continue to educate yourself, that certainly helps.

There is no recipe for success, but that’s what worked for me.”

It’s imperative for financial advisors to develop a strong foundation of trust with clients. That means putting all cards on the table when it comes to finances, which is why Rodier engages in a deep discovery process with each client before discussing stocks, bonds or any other investment vehicle.

“That gives us their experience in investing, whether it’s positive or negative – if they were burned by something in the past, if they are risk-averse in general, and also if there are any major upcoming expenses,” he says.

After that, Rodier and his team look at the client’s savings and balance that against sources of income. It’s usually done in-house, but he sometimes brings in outside resources

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when necessary.

“We produce a very detailed wealth plan with multiple pillars, including cash-flow analysis, estate planning, wills/power of attorney, as well as tax and retirement planning,” Rodier says. “It gives us a good idea of what the client needs. At that point we can feel confident about making a recommendation for X% in equities versus Y% in fixed income.”

Since Rodier broke into the business 15 years ago, the means and methods of communication have changed considerably.

But while technology has altered the advisory business in many ways, Rodier explains that some things never change.

“There is still a lot of face-to-face,” he says.

“It’s really important that we get to know our clients extremely well. Our clients are entrusting us with their life savings and their future, so it’s something we need to earn. That’s not typically earned through an exchange of emails.”

Those interactions will invariably involve a discussion about compensation, but Rodier doesn’t find that to be an awkward conversation. He’s confident about the value he provides for clients and fully supports any moves by regulators to make the industry more transparent.

“Since day one I have been extremely open and realistic about the fees being charged and the expected returns over the long run,” he says. “Rodier Asset Management and TD are supportive of [CRM2]; the changes provide more information to clients, which lets them make better informed decisions about their finances and investments – that just makes good sense.”

Heading into the new year, Rodier is confident he has his bases covered.

Whether the bull market continues to run or a correction materializes in 2018, he has balanced his portfolios for all eventualities.

“Things can change rapidly in this industry,” he says. “We are very well positioned to

BREAKING WITH TRADITION After making the switch from TD’s retail banking arm into wealth management, Matthew Rodier obtained his CIM designation to become a portfolio manager in 2013. Since then, he has been transitioning his clients into discretionary accounts. It’s a move they have been receptive to, and one that entails the use of more alternative investments in portfolios.

“We moved away from traditional fixed-income holdings a few years ago and into alter­ native strategies,” Rodier says. “If used properly, that can be extremely helpful in protecting capital in the face of rising interest rates.”

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CLIMBING THE LADDER Staying with the same company throughout your career is becoming less and less common, but Matthew Rodier’s career path proves that there are clear advantages to staying the course.

2002 First joined TD Canada Trust, working in retail banking

2003 “There is still a lot of face-to-face. Our clients are entrusting us with their life savings and their future, so it’s something we need to earn. That’s not typically earned through an exchange of emails” absorb a potential interest-rate hike or other economic or market-related changes. Our practice is set up in such a way that we are nimble and can pivot easily if need be.”

In the Canadian markets, Rodier plans to maintain exposure to the companies and industries that have served him well in recent years. Chasing the highest possible returns could put his clients’ assets at risk, so keeping one eye on the downside is always

foremost in his mind.

“We try to underweight dramatically the riskiest sectors – materials, energy, resources,” he says. “We replace them with sectors such as Canadian financials, telecommunications or consumer staples.

We understand that might mean less growth, but it also means less volatility, and those sectors have done quite well for us over the last several years.”

Moved into financial advice with the firm

2008 Made the step up to TD Wealth and became head of Rodier Asset Management

2017 Won the IIAC Top Under 40 Award

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12/01/2018 5:55:04 AM

SPECIAL PROMOTIONAL FEATURE

PRIVATE DEBT

Risk, reward and private debt A new webinar hosted by Ninepoint Partners shines the spotlight on this alternative solution for retail investors INVESTING – PARTICULARLY in a way that generates healthy returns – is becoming increasingly complex. The days of the simple 60/40 portfolio split are long gone, and alternative strategies are becoming commonplace for those seeking greater diversification.

Private debt is one such option, and was the theme of a recent webinar held by newly

director of its alternative income group, along with three other experts in the field: Arif N. Bhalwani, CEO and managing director of Third Eye Capital; Wayne Ehgoetz, president and CEO of Waygar Capital; and Natasha Sharpe, CIO of Bridging Finance.

Private debt is a market currently experiencing rapid growth, with the potential for a

“This industry is set to reach US$1 trillion by 2020 ... The sector has increased in size 14 times since 2000, reaching $600 billion by the end of 2016” Ramesh Kashyap, Ninepoint Partners launched investment manager Ninepoint Partners. Under the leadership of founders John Wilson and James Fox, the firm (the former Sprott Asset Management) is aiming to become the asset manager of choice in the alternative space.

Hosted by WealthProfessional.ca editor Joe Rosengarten, the webinar featured Ninepoint’s Ramesh Kashyap, managing

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lot more in the years ahead, as Kashyap explained. “According to AIMA, this industry is set to reach US$1 trillion by 2020,” he said.

“The historic compound annual growth rate of the industry is 20%, and the sector has increased in size 14 times since 2000, reaching $600 billion by the end of 2016.”

Since the financial crisis, banks have been less inclined to lend to private enterprise,

prompting alternative lenders to step in to fill the void. This not only benefits those businesses, but also provides investment opportunities for those seeking a more diverse asset mix in their portfolios.

“Like private equity, private debt has traditionally been a space where institutional investors like pension funds, insurance companies, endowments and foundations have invested money, but this is changing,” Kashyap said. “There is an increased flow of capital by high-net-worth individuals, family offices and wealth managers.”

Ninepoint currently manages just over $800 million in private debt funds, the majority coming from retail clients. Given the mounting trepidation about how long the current bull market can keep its legs, investors and advisors are increasingly turning to alter­ natives. There remains a stigma surrounding these investments, however, particularly when it comes to liquidity risk.

“The primary risk when people are making relative comparisons between traded credit and private debt really surrounds the liquidity,” explained Third Eye Capital’s Arif Bhalwani. “All of us are taking risk actively.

Investors shouldn’t expect to generate any money if they are not going to take some risk.

The key is not about avoiding risk – it is about controlling risk. What that entails is being on top of the capital structure and being overcollateralized by a group of assets.”

By taking on calculated risk, Bhalwani continued, investors are putting their faith in a company’s future. “How we generate our returns is investing in those situations where perceived risk is worse than reality,” he said.

“Once we bridge that gap, we get to a situation where the market appreciates that company and it can refinance.”

Natasha Sharpe of Bridging Finance, which specializes in bridge loans with shorter durations where clients are highly incentivized to pay out quickly, emphasized that risk isn’t something that can be totally avoided in this process.

“I completely agree with Arif that there is

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“You can’t expect return without risk, and anyone who is promising you a risk-free strategy is going to be promising you, almost by definition, a return-free strategy as well” Natasha Sharpe, Bridging Finance no such thing as yield for free,” she said.

“When I was the chief credit risk officer for Sun Life Financial, it was a conversation I would have on a quarterly basis with the board of directors: You can’t expect return without risk, and anyone who is promising you a risk-free strategy is going to be promising you, almost by definition, a return-free

strategy as well.”

The panel’s conversation shifted to the topic of loan defaults, and Waygar Capital head Wayne Ehgoetz outlined how a lender can protect itself against such an eventuality.

“I understand why people put a risk label on what we do,” he said. “Certainly we change a much higher rate – something in the low to

high double digits. We are also lending to companies that generally the banks won’t finance. To me, risk is mitigating the issues that create risk.”

Ehgoetz went on to explain that doing so entails a level of due diligence over and above what the banks typically require, which allows the lender to protect its interests for all eventualities.

“In our type of lending, we use far more third-party opinions, as well as background checks and criminal checks on borrowers to establish the advance rates we should be lending to these companies,” he said. “We look at risk as: If the company goes under and we have to sell every asset, would we get our money back? If we won’t get our money back on that scenario, we go no further.”

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12/01/2018 5:55:27 AM

FEATURES

MEETINGS

Say no to dull meetings Business strategist Matt Malouf explains how getting the rhythm and subject of your meetings right can turn tedious encounters into business turning points THE KEY to great management, whether your staff members are local or overseas, virtual or in your workplace, is regular communication and a good meeting rhythm.

Think of meetings as the pulse of your business: If it’s not beating regularly and rhythmically, then inevitably you’ll get an unhealthy system.

In the 15 years I’ve spent working in or with growing companies, the companies that are consistently growing and achieving their goals are those that have established a routine and rhythm of having meetings. The faster they are growing, the more meetings they have. While this may sound counterintuitive or even crazy, I need to clarify that I’m not talking about having a meeting for the sake of having a meeting. I’m talking about having short meetings that are run to time, with a specific structure and agenda.

Most meetings are poorly run, demotivating and, to be frank, a waste of everyone’s time. If run properly, your meetings will be inspiring and positive and enable the business to grow at a faster rate.

A big key to running successful meetings is to prepare for them properly. This is why daily, weekly and monthly reports are so important. The reports are designed to give you the information required to run a short and productive meeting. This way,

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the meeting can cut through the information-gathering stage that often takes up the majority of most meetings and get straight into constructive discussions and/or sharing.

A great meeting rhythm I have implemented with many companies is a daily meeting (sometimes referred to as a daily huddle), a weekly meeting and a monthly meeting.

Daily meeting or huddle – a must in growing companies A daily meeting or huddle is a short meeting (five to 15 minutes) designed to support discussions around tactical issues and

are practicing on a daily basis. You may feel like you don’t have the time to conduct such a meeting or that you are having enough interactions already, so you don’t need another meeting. In my experience, when implemented well, the daily huddle will save you time, reduce impromptu conversations and increase the efficiency of information-sharing.

I have worked with many organizations that have implemented this well, and the results are immediate. Your team will be more aligned, and you will be able to control the internal energy while accelerating the growth of your company. Let me delve a little

I’m not talking about having a meeting for the sake of having a meeting. I’m talking about having short meetings that are run to time, with a specific structure and agenda provide short updates. This is a great way to bring everyone together, keep everyone focused, and build a culture of camaraderie and teamwork.

While this may seem like overkill, this is a practice that many fast-growing companies around the world have implemented and

deeper into the structure and limits that lead to a successful daily huddle.

Timing It is recommended that you set the start of the daily huddle at an odd time, such as 10:10 a.m. or 12:12 p.m., to make it memor-

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able. Starting at an odd time often leads to people being on time, believe it or not. As this is quite a short meeting, you don’t have very much time to waste. So it is important to the success of the huddle that you start and finish on time. (Ideally, the meeting shouldn’t go for longer than 15 minutes.) In the beginning, I recommend getting someone to time the meeting and to end the meeting regardless of whether the agenda is finished or not.

people in less meetings, not more meetings with less people.” It is for that reason that I recommend you involve the maximum number of staff members. The ideal number to keep the meeting short and allow a good exchange of information is 10 to 20 people.

In larger companies, I would recommend you create a daily huddle in each department and another daily huddle with the heads of departments.

Setting

Agenda

In order to the keep the meeting short, it is best to conduct the daily huddle standing up.

This keeps the energy high and will help you to avoid extending the conversation – people don’t want to have to stand for too long.

The last point to consider is the heart of the daily huddle: the questions. The agenda should be the same every day – only three items long (allowing up to five minutes per item). An agenda that has worked with many of my clients revolves around the following three questions:

Participants Verne Harnish, author of Scaling Up and a leading pioneer of the daily huddle concept, says, “In general, the goal is to have more

Did you achieve your primary focus yesterday?

What is your primary focus today?

What obstacles will keep you from completing it?/Where are you stuck?

The meeting rhythm will depend on the role and the organizational culture.

Depending on what other meetings are scheduled, I usually have a daily meeting with my personal assistant. That daily meeting is critical to her role and her ability to support me in what I’m doing. Those meetings are prebooked one month in advance.

It’s a 15-minute meeting, and the conversation starts with, “How can I help?”, and then my assistant will give all the updates for the day. The meeting shifts when she says, “Matt, how can I help you?”, and then I update her on what I need done. While hosting this meeting, we use Asana, our project management tool. We both have it open and make changes in real time so we

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FEATURES

MEETINGS can both see the capture of those tasks and make sure they get managed properly.

Weekly and monthly meetings The second meeting type is the weekly meeting, which is a 50-minute meeting with a clear agenda that talks about the critical progress updates within a business. It engages conversation to help people understand and gathers feedback from the team on what the business should keep doing, stop doing and start doing.

When it comes to one-on-one, team, weekly or any other meetings that follow an agenda, culturally it’s good to start with: What are your wins for the week, and why do they matter?

What has been your biggest challenge, and

why does it matter?

What have you learned in the past week, and how can you apply it?

This helps set a positive mood and tone for the meeting, providing a chance to celebrate individual victories as a team and praise individuals in front of the team.

‘Wins and positives for the week’ could be the first item on your meeting agenda. From there, move on to the remaining items. I always end my weekly meetings with these two questions: As an organization, based on the past seven days, what should we stop doing?

As an organization, based on the past seven days, what should we start doing?

their concerns or frustrations, as well as provide ideas or solutions that can enhance the business.

Monthly meetings follow a similar agenda to the weekly meetings, except you need to add a strategic layer to them. By this I mean you should check in with the company’s goals and solve any major challenges to enable you to continue moving forward.

Edited excerpt from The Stop Doing List (Wiley, $27.95) by Matt Malouf Matt Malouf is a business strategist and the author of The Stop Doing List, which draws on Malouf’s work with big businesses and startups to help business owners free up time to build their businesses. The Stop Doing List is available in bookshops and online.

These two questions allow people to voice

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12/01/2018 5:56:53 AM

PEOPLE

CAREER PATH

MAN OF ACTION It seems the only thing Rob Tetrault can’t do is stand still

Raised in a strongly entrepreneurial household, Tetrault followed in his parents’ footsteps early. At age 8, he was knocking on doors to find lawns to mow; by 9, he had started working at one of the family businesses “I remember vacuuming the restaurant before school in third grade. Having a business is in my blood. My parents taught me that if you work harder than everyone else, you’ll succeed. I could see it was neat being your own boss”

1990

DISCOVERS HIS ENTREPRENEURIAL STREAK

2008

LEAVES LEGAL WORK BEHIND While working as a lawyer, Tetrault was prompted by his wedding video to make a fateful decision “In my mom’s speech, she said, ‘Make sure you’re doing something you’re passionate about.’ I looked at my wife and said, ‘I’m leaving the practice of law.’ I did an MBA in 11 months to help decide what to do next. All I knew was that I wanted to run my own shop and that I’m good at connecting with people”

2008 FINDS A CAUSE Tetrault was sent down a new path when his newborn son was diagnosed with congenital cytomegalovirus [CMV], an infection that can lead to long-term health problems, including hearing and vision loss, muscle weakness, and seizures. The diagnosis ultimately led Tetrault to found both a major event and a charity “We were a success story. [His treatment] was a roaring success. I didn’t like the status quo. I thought, ‘There’s got to be a better way to communicate with patients.’ It felt like a calling of some sort, like something I just had to do”

2012 FOUNDS A CHARITY Tetrault’s experience with his son’s CMV diagnosis culminated in the creation of Le Classique, an outdoor winter ball hockey tournament.

Shortly after, he started the Canadian CMV Foundation “I have a billion things on the go at all times; this is where I decided to spend my time. I have three passions: work, family and community involvement.

I knew what to do with this third of my life”

2003

STARTS LAW SCHOOL After earning a bachelor’s degree in political science and business administration from Université de Saint-Boniface, Tetrault went on to pursue a law degree at the University of Toronto “I had a vision of either being a CEO or having my own company, and I thought I would need a legal background; it was a long-term plan. I liked the law but didn’t have it figured out beyond that”

2008

GETS HIS MBA While studying for his MBA, Tetrault earned both a 4.03 GPA and a passive income when an e-book he wrote on how to pass a specific course at the MBA level became a hit “One of the students looked at me and said, ‘You should write a book.’ That night I bought the domain, and within a year, it was bringing in $30,000 a month”

2010

GOES OUT ON HIS OWN Soon after founding Tetrault Wealth Advisory Group, Tetrault reached his initial goal of $100 million in AUM

“Then the goal was for $250 million AUM, and we blew through that. Now we’re aiming for a billion. The money is just a measuring tool for me. I want to have the best practice, to be the best for my clients” www.wealthprofessional.ca

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PEOPLE

OTHER LIFE

TELL US ABOUT YOUR OTHER LIFE Email wealthprofessional@kmimedia.ca

During honey season, Ada ms extracts and bottles honey every other weekend

200,000 Estimated number of bees in Adams’ five hives

240

Pounds of honey collected during honey season (June to August)

8

Miles a bee can travel in search of nectar

BUSY AS A BEE For Ottawa-based financial planner Brian Adams, caring for his hives is sweet as honey BRIAN ADAMS’ interest in bees stretches back to childhood, but it wasn’t until he spent an afternoon exploring an apiary with his grandson that Adams, the president of Ottawa’s Ecivda Financial Group, was inspired pursue beekeeping as a hobby.

The demanding pastime appeals to

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Adams’ meticulous nature. “I like challenges; I don’t like things that are easy,” he says. “You have to look after the bees like any other crop or animal – the hives need to be medicated at certain times and harvested at certain times. There’s no question that it ties in to how I am with clients.”

Another benefit that flows from

watching over the hives is the meditative sound of buzzing bees. Adams looks forward to his weekly inspection of his five hives of almost exclusively female bees – “checking the girls,” as he calls it. “The sound of that many bees is very soothing,” he says. “The calmest I am is when I’m out in the bee yard.”

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ETFs

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BALANCED FOR BETTER OUTCOMES.

PRIVATE WEALTH POOLS

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MANAGED ASSETS

would have reduced returns. Mutual funds are not guaranteed, their values change frequently and past performance may not be repeated. of all distributions and does not take into account sales, redemption, distribution, or optional charges or income taxes payable by any security holder that The indicated rates of return are the historical annual compounded total returns as of November 30, 2017 including changes in unit value and reinvestment trailing commissions, management fees, and expenses all may be associated with mutual fund investments. Please read the prospectus before investing. category: 1 year - n/a stars 9.1%, 3 years - 4 stars (700 funds) 8.7%, 5 years - 5 stars (464 funds) 12.4%, 10 years - 5 stars (226 funds) 7.6%. Commissions, 8.4%, 5 years - 5 stars (639 funds) 10.0%, 10 years - 5 stars (229 funds) 6.9%. Mackenzie Ivy Global Balanced Fund Series F, Global Neutral Balanced funds) 7.5%. Mackenzie Global Strategic Income Fund Series F, Global Neutral Balanced category: 1 year - n/a stars (947 M O11.2%, R N I N3Gyears S TA–R5 stars CAN A Dfunds) A Global Neutral Balanced category: 1 year - n/a stars 10.7%, 3 years - 5 stars (467 funds) 6.7%, 5 years - 4 stars (355 funds) 7.9%, 10 years - 5 stars (152 3 years - 5 stars (366 funds) 10.3%, 5 years- 5 stars (291 funds) 13.2%, 10 years - 5 starsMackenzie (153 funds) 7.3%.

MackenzieGrowth Strategic Income Fund Series Canadian Balanced FundF, performance for the standard periods are: Mackenzie Canadian Growth Balanced Fund Series F, Global Neutral Balanced category: 1 year - n/a stars 12.0%, Mackenzie Strategic Income Fund on the fund series-level data Morningstar provides. The CIFSC categories, Star Ratings, number of funds in each category, and annual compounded calculation of Morningstar Star Ratings, see www.morningstar.ca. Quartile rankings and peersMackenzie beaten are calculated Mackenzie Investments based GlobalbyStrategic Income Fund stars; a place in the middle 35% earns a fund 3 stars; those in the next 22.5% receive 2 stars; and the lowest 10% receive 1 star. For more details on the Mackenzie Ivy Global Balanced Fund allow comparison for at least three years. If a fund scores in the top 10% of its fund category, it gets 5 stars; if it falls in the next 22.5%, it receives 4 measured against the 91-day treasury bill and peer group returns. A fund can only be rated if there are a sufficient number of funds in its peer group to record are considered. The overall star rating for a fund is a weighted combination calculated from a fund’s 3, 5, and 10-year returns, as available, quantitative measure of a fund’s historical risk-adjusted performance relative to other funds in its category.

Only funds with at leastsolutions a three-year that track Choose multi-asset Morningstar Star Ratings reflect performance of Series F as of November 30, 2017 and are subject to change monthly. The ratings are an objective,

simplify investing for you.

This RRSP season, talk to your Mackenzie Representative.

talk to your Mackenzie Representative.

This RRSP season, simplify investing for you.

Morningstar Star Ratings reflect performance of Series F as of November 30, 2017 and are subject to change monthly. The ratings are an objective, Choose multi-asset quantitative measure of a fund’s historical risk-adjusted performance relative to other funds in its category.

Only funds with at leastsolutions a three-year that track record are considered. The overall star rating for a fund is a weighted combination calculated from a fund’s 3, 5, and 10-year returns, as available, measured against the 91-day treasury bill and peer group returns. A fund can only be rated if there are a sufficient number of funds in its peer group to allow comparison for at least three years. If a fund scores in the top 10% of its fund category, it gets 5 stars; if it falls in the next 22.5%, it receives 4 Mackenzie Ivy Global Balanced Fund stars; a place in the middle 35% earns a fund 3 stars; those in the next 22.5% receive 2 stars; and the lowest 10% receive 1 star. For more details on the GlobalbyStrategic Income Fund calculation of Morningstar Star Ratings, see www.morningstar.ca. Quartile rankings and peersMackenzie beaten are calculated Mackenzie Investments based on the fund series-level data Morningstar provides. The CIFSC categories, Star Ratings, number of funds in each category, and annual compounded Mackenzie Strategic Income Fund performance for the standard periods are: Mackenzie Canadian Growth Balanced Fund Series F, Global Neutral Balanced category: 1 year - n/a stars 12.0%, Canadian Balanced FundF, 3 years - 5 stars (366 funds) 10.3%, 5 years- 5 stars (291 funds) 13.2%, 10 years - 5 starsMackenzie (153 funds) 7.3%.

MackenzieGrowth Strategic Income Fund Series Global Neutral Balanced category: 1 year - n/a stars 10.7%, 3 years - 5 stars (467 funds) 6.7%, 5 years - 4 stars (355 funds) 7.9%, 10 years - 5 stars (152 M O11.2%, R N I N3Gyears S TA–R5 stars CAN A Dfunds) A funds) 7.5%. Mackenzie Global Strategic Income Fund Series F, Global Neutral Balanced category: 1 year - n/a stars (947 8.4%, 5 years - 5 stars (639 funds) 10.0%, 10 years - 5 stars (229 funds) 6.9%. Mackenzie Ivy Global Balanced Fund Series F, Global Neutral Balanced category: 1 year - n/a stars 9.1%, 3 years - 4 stars (700 funds) 8.7%, 5 years - 5 stars (464 funds) 12.4%, 10 years - 5 stars (226 funds) 7.6%. Commissions, trailing commissions, management fees, and expenses all may be associated with mutual fund investments. Please read the prospectus before investing.

The indicated rates of return are the historical annual compounded total returns as of November 30, 2017 including changes in unit value and reinvestment of all distributions and does not take into account sales, redemption, distribution, or optional charges or income taxes payable by any security holder that would have reduced returns. Mutual funds are not guaranteed, their values change frequently and past performance may not be repeated.

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12/01/2018 5:45:00 AM