Managed Money Reporter Newsletter — Issue 286, July/August 2015

Editors: Carl Spiess & Allan McGlade

Featured Articles

Mid-Year Market Commentary

Carl Spiess

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

We hope you are enjoying your summer. We are pleased to share this edition of our newsletter with a number of articles you might read while on vacation — or after! As always, please contact us if you have any questions on your accounts.

Global markets have been volatile with a true Greek drama / tragedy first roiling European markets. More recently, China's limited stock market dramatically gave back some of the significant gains it saw over the last year. Oil prices have continued to slide with continuing supply excess and decreased global demand. And the Bank of Canada surprised investors on July 15th with another 0.25% interest rate cut reducing the overnight target rate to 0.5%

As a result of all of this, the Canadian dollar dropped significantly vs. the US$. This benefited clients with foreign investment holdings. TSX stock index has dropped - especially the resource sector. Even preferred shares, which are generally a safer category of investments, declined in value. Rates for daily interest savings accounts and Guaranteed Investment Certificates have also declined.

Stock market leadership in corporate Canada is also changing. Valeant Pharmaceuticals International Inc. replaced Royal Bank of Canada on July 23rd as the largest company by stock valuation. Its shares have doubled in value over the last 12 months after a string of acquisitions.

Our expectations for the rest of the year are somewhat muted. However, a regularly balanced portfolio with a combination of solid dividend paying Canadian equities, international equities and a ladder of guaranteed investments should still provide the best risk / return characteristics going forward. And for those topping up TFSAs, RRSPs or with cash on the sidelines, the current downturn in Canadian stocks and preferred shares could be a real opportunity.

For all this with much more detail, please see our summer edition of Investment Portfolio Quarterly:

If you prefer to listen to an audio commentary from our Portfolio Advisory Group, visit our site which has bi-weekly updates:



Do Advisors really add 3% to Client Returns?

Recently, a low cost index fund provider surprised some observers of the investment industry with its claim that investment advisors can enhance client returns by up to 3%. Here is a summary of their research findings:

Recent Vanguard research shows that your advisor not only adds peace of mind, but also may add about 3 percentage points of value in net portfolio returns over time.

  • What does this mean? Your advisor has the ability and the time to evaluate your portfolio investments, meet with you to discuss objectives and help get you through tough markets. All of these factored together potentially add value to your net returns (returns after taxes and fees) over time.
  • With portfolio construction, your advisor can work with you to create a diversified portfolio, while ensuring you don't pay too much for investments or in taxes on investment returns.
  • Wealth management entails making regular changes to your portfolio to help reduce risk, and when you're ready to withdraw, you can do it in such a way to help limit the taxes you'll pay.

While we think it is a bold claim and is indeed difficult to quantify, we are similarly confident that we do add value to our clients' returns. And we are pleased to discuss with you in detail the fees on your investments, uses of lower cost investment vehicles and your personal rates of return. You can see Vanguard's research at:


Team news: Team BBQ & Andrew's community involvement

With the Spiess McGlade Team back to our normal staff complement, we actually don't have any personnel changes to report. So we are including a picture of the team and families at our annual summer BBQ. This year we had the BBQ at a disc golf park — you can see the disc golf basket in the centre of the picture.

Andrew McGoey is a passionate disc golfer and showed off his impressive skills in that sport to the rest of us. We're proud of the contributions Andrew has made to helping the sport grow in Toronto: acting on the board of directors for the Ontario Disc Sports Association in 2013, running a weekly club with over 50 members and helping to install the first new course (in 30 yrs) within the GTA in E.T. Seton Park. The course was featured in the National Post:


Updated Documentation

ScotiaMcLeod periodically updates our "Terms and Conditions" brochure. We share a copy with new clients, but if you haven't seen the document recently, you can find it at the bottom of our forms page or directly at:

Please contact us if you have any questions about this document.


Recommended Link of the Month

Our recommended site of the month is All About Estates. It is a unique blog written collaboratively by many top Canadian experts in the field of estate planning, philanthropy and social work. A few of the experts are colleagues at Scotia that we turn to as part of our team of experts. A great recent article asks and answers "Do you ever wonder what happens if you die without a will?" with a link to a great video.



Contact Us

T.  416.863.RRSP (7777)
F.  416.863.7479

ScotiaMcLeod is a division of Scotia Capital Inc., member of CIPF.

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The Spiess McGlade Team is a personal trade name of Carl Spiess and Allan McGlade.