Managed Money Reporter Newsletter — Issue 241, December 2007

Editors: Carl Spiess & Allan McGlade

Featured Articles

20 Years of the Mutual Fund Reporter

By Carl Spiess, CFP, CIM, FMA, FCSI, MBA, Director

After over 240 issues of our newsletter, first on paper and then a few different electronic formats, we will be reworking the format of our updates in the New Year. Watch for a new look and a new name: Managed Money Reporter ( This reflects how our business has grown over the years to meet your financial goals. While mutual funds continue to be the anchor for most of our clients' financial plans, they are only part of the total managed solutions that we, The Spiess McGlade Team at ScotiaMcLeod, create for our clients. This new name will reflect the fact that The Spiess McGlade Team offers you, our clients complete financial planning solutions, including:

  • retirement planning,
  • tax minimization strategy,
  • education planning,
  • estate and insurance planning,
  • and much, much more.

Mutual funds (and insurance, stocks, bonds, annuities, GICs, etc.) are the tools that help us to implement, monitor and adjust those plans so that together, we can achieve your financial goals.

It is interesting to see what has happened over 20 years (see chart, below). Back in 1987, of course, the biggest news was the stock market correction of October 19th. During the 1990s, markets chugged along nicely with only a slight hiccup around the first Gulf War. After a downturn in 2002 around the start of the second Gulf War, markets have performed well for the remainder of this decade. There are currently some concerns over the economy in the US and its potential to affect markets here in the coming years but time will tell. As always, your best financial friend in uncertain times is a well-crafted financial plan that will help you to prosper in good times and ride out the bad times.

With all the news about Canadian resource gains in the last few years, it is interesting to see that gold and oil prices have not nearly kept up with the Canadian and US markets. Also, while the US market has recently surpassed its highs of 2000 and 2001, in Canadian dollar terms, investments in the US market are still underwater, 7 years later, despite the S&P 500 being the best market over the last 20 years.

It is also interesting to look at the newsletter from 10 years ago. International funds were all the rage. We also made our first mention of TIPS, the first exchange traded fund, for investors worried that large mutual funds might lag the market. Exchange traded funds have of become a significant alternative to mutual funds, with each vehicle having pros and cons for investors.

More on 20 years of the Mutual Fund Reporter

Season's Greetings from Your Investment Team

We would like to thank our clients for allowing us to serve your investment needs for another year.

Please see our annual photo, below. Yes, the plaid jacket is the old McLeod tartan, homage to the McLeod Young Weir stock traders that used to be the most visible traders on the Toronto Stock Exchange floor. Now the Jacket is just worn to remind us of our corporate heritage (for more, see our June 2004 issue).

Manulife Improves Income Plus – Enhancements to GMWB products

by Allan McGlade, CLU, CFP, Senior Investment Executive

Last December, we wrote about the launch of the IncomePlus product by Manulife. It was the first variable annuity contract of its kind in Canada, offering Guaranteed Minimum Withdrawal Benefits (GMWB). Since that time, Sunlife has come to market with its own variable annuity called SunWise Elite Plus. The features of the variable annuity have clearly resonated with Canadians. Manulife has taken in roughly 2.5 billion dollars into IncomePlus since its launch in October of last year.

Recently, Manulife announced enhancements to IncomePlus. A Guaranteed Withdrawal Balance bonus of five percent is now available during any of the first 15 calendar years in which no withdrawals are taken. Previously the bonus was available in the first 10 years. If all 15 bonuses are earned, a minimum of 175% of the initial investment will be available for lifetime annual withdrawals. Further, beginning at age 65 the guaranteed annual income amount can be guaranteed for life. Previously, the guarantee was for 20 years. We expect Sunlife to follow suit and introduce similar enhancements in the New Year. Further, we expect other insurance companies to enter the variable annuity market which should provide investors with even greater improvements to the product over time.

Interestingly, the enhancements will not change the fee structure of IncomePlus. We felt that the product was expensive when we did our due diligence last year. The new enhancements provide better value for the money, however.

We think IncomePlus can play a part in retirement portfolios. If you are approaching retirement (50 or older) or are already retired, we suggest investigating the Manulife and Sunlife variable annuity products further. For more details, visit the Manulife and Sunlife web sites or contact us by email or at 416-863-7777 or 1-800-387-9273. We would be happy to help you determine if the benefits and features of a variable annuity are right for you.

More on IncomePlus and guaranteed minimum withdrawal benefit annuities

Recommended Reading – Year-End Tax Tips

Please see the attached article on year-end tax tips and contact us if you have any questions. Please note, for tax loss selling in Canada, trades need to be placed by December 24th.

Canadian Investment Awards

Two weeks ago, the investment industry celebrated the 13th annual Canadian Investment Awards. Winner of the Analysts' Choice Fund Company of the Year was CI Investments, and Advisors' Choice Favourite Investment Fund Company Award went to Dynamic Funds. For full details and individual fund and investment winners, see:

More Recommended Reading – IPQ Fall 2007

Our latest edition of Investment Portfolio Quarterly has been put on the site for you.

After publication, there was more news on the credit crisis in the US. One of the most interesting bits of reading came from the U.S. Morningstar website. See:

Mutual Fund Reporter Recommended Web site of the Month

To see one of the many industry publications investment advisors read, check out and last month's article:

  • Canadian's fail tax survey from

You can take the tax test yourself and see how you do:

  • Canadian Tax Test from Mackenzie Financial


Contact Us

T.  416.863.RRSP (7777)
F.  416.863.7479

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