Gwen Becker, Matco Financial Inc. walks us through what we need to know about investment and financial planning.

1. Investing
- tame your fears and grow
Gwen Becker, CIM, CFP, FCSI
Vice-President, Associate Portfolio Manager

2. Whose Involved in Making Investments Decisions?

3. Overwhelmed
Women are still pulling
double shifts
Life life’s us
So much information exists
o Industry jargon
o Why bother in this market?
Everything seems to work out
okay in the end

4. The Factual Conversation
Women influence 70% of consumer spending decisions in this
country1
In the next 10 to 20 years, many boomer women will inherit
wealth twice – from their parents and their spouse1
82% of Canadian wealth will eventually be managed by women1
70% of women switch advisors after the death of a spouse1
Average age of a widow is 562
According to one Cornell study, 10 trillion dollars in inheritance
will pass to baby boomers between now and 2040 – majority of
inheritors will be women2
1 Source: TDWIS Newnet Article obtaining an uncommon understanding of your client interview with Dave Pickett: The Rise of High Net Worth Female Investors
2 Source: My Money Mindset (www.mymoneymindset.com) by Dr. Deborah Nixon

5. The Factual Conversation
Women have been raised to be the keepers of the household
purse, not the income generators. That legacy lives on for the majority
of the population. Budgeting, borrowing and everyday saving is not a
primary struggle for women – wise investing is.2
Women want a financial advisement process that accounts for her
heart, not her ego. In other words, a process that incorporates her
feelings, her perceptions, her life situation and her desires to take care
of others.2
Two-thirds of women are single by the time they hit age 65—either
because they never married, their spouses pass away, or they
divorce.2
Don’t know what you don’t know. Start with what should I know?
1 Source: TDWIS Newnet Article obtaining an uncommon understanding of your client interview with Dave Pickett: The Rise of High Net Worth Female Investors
2 Source: My Money Mindset (www.mymoneymindset.com) by Dr. Deborah Nixon

6. Solutions To Challenges
FINANCIAL PLAN & GOAL SETTING
o Regardless of your situation
TYPES OF ADVISORS & EXECUTION
o Not alone, Not all or nothing
INVESTMENT STRATEGIES
o Constructing an “Investment Portfolio”
o “Asset Classes”
o Cash, “Fixed Income & Equities”
 Cash, Bonds & Stocks
CYCLES & SEASONALITY

7. Written Financial Plan -
30% of Women Have One
Budget (www.mint.com)
Cash Flow
Goals vs. Ability
Net Worth Statement
Projected Net Worth
Report Card "You've got to be very
careful if you don't know
where you are going
because you might not get
there." Yogi Bear

8. Goal vs. Ability

9. Specific and Obtainable Goals
Short term (less than 1 year)
emergency funds, down payment
home, vacation
Mid term (2-5 years)
fund child’s post secondary
education, care for aging
parents, revenue property, pay down
debt
Long term (5+ years)
buy a winter /summer
home, comfortable
retirement, philanthropy, estate

10. Investment Portfolio = Goal
Income Balanced Growth
• Need For Current • Equal Focus On • Little Need For Current
Income Growth and Current Income
• Moderate Focus On Income • Focus On Growth For
Growth Above • Moderate Tolerance Capital Appreciation
Inflation For Risk • High Tolerance For Risk
• Low Tolerance For Risk • Intermediate • Intermediate/Long
• Short/Intermediate Investment Horizon Investment Horizon
Investment Horizon • Emphasize Time
Horizon Over Risk
INCREASING RISK, VOLATILITY AND RETURN EXPECTATIONS

11. Constructing an Investment Portfolio
Diversification of Asset
Classes
Participating in the gains
while managing the
down side risk

12. Asset Allocation Decision
70% Bonds / 30% Stocks 50% Bonds / 50% Stocks 30% Bonds / 70% Stocks
Income Balanced Growth
SOURCE: www.ishares.ca | Index Compound Returns shown BEFORE fees all in CAD $ ending December 31st, 2012

13. Asset Class Returns
Index Returns (ending December 31, 2012)
SIMPLE % COMPOUND %
1 Mth 3 Mths 6 Mths 1 Yr. 3 Yrs* 5 Yrs* 10 Yrs*
S&P/TSX (TR) Index 1.95 1.72 8.86 7.19 4.79 -0.81 9.22
S&P/TSX Capped Energy Index (CAD$) 0.07 -3.58 7.07 -4.83 -3.25 -3.81 9.65
S&P/TSX Small Cap (TR) Index 2.40 -2.00 6.16 -2.23 3.35 -0.46 5.70
S&P 500 Index (CAD$) 0.80 -0.24 5.86 13.00 8.8 1.70 2.30
MSCI EAFE Index (CAD$) 3.26 7.62 12.76 17.65 2.63 -4.93 5.29
MSCI World (TR) Index (CAD$) 2.12 3.71 6.81 13.26 5.11 -1.01 2.66
DEX Universe Bond Index -0.13 0.30 1.54 3.60 6.64 6.35 5.97
SOURCE: www.ishares.ca | Index Compound Returns shown BEFORE fees all in CAD $ ending December 31st, 2012

14. Risk (4-Letter Word) /Return Trade-Off
The Efficient Frontier
Asset Class diversification
works over the long run
• Bonds negatively
correlated with stocks
(“Defense”)
• Pure income
portfolios have ~2/3
the risk of stocks
• Pure bond investors
benefits from small
addition of stock
exposure given
negative correlation

15. Asset Class Returns
January 1, 1950 – June 30, 2011
Despite the financial
crisis, long term stock
returns continue to lead all
asset classes.
• Bonds performed well
over the last 61 years.
¾ of the return & only
¼ of the risk vs.
Canadian Equities
• Interest Rates peaked
in early 1980s
• Inflation rate has been
remarkably steady
over the postwar
period

16. Chasing Last Years Return - Asset Class Performance

17. The Problem With Going With The Flow

18. Herding: Our Tendency Is to Follow the Crowd

19. Common Mistakes
Unclear investment objectives
Poor asset allocation
Extremely concentrated
o 15 – 20 stocks to reduce risk
Over diversification
Focusing on returns without risk
Emotional or trend investing
Hot stock tip

20. Dividend Investing

21. Styles of Investor (Jargon)
Deep Value
o Seek out companies trading at deep discounts relative to asset value
o Low price to earnings multiple or price to net asset value or price to book
o Eg: Research in Motion (RIM)
Value
o Value typically describes a relationship of the price a particular company is trading at relative to the
stream of earnings or cash flow company produces. All else equal – pay lower price for large stream
of earnings or cash flow
o Eg: Microsoft (MSFT), McDonalds (MCD), Magna (MG)
Growth
o Focus on companies growing earnings stream and assets typically at a high rate. Investment themes.
o Often willing to pay higher price for those assets because expect company to grow much more in the
future.
o Eg: Facebook (FB), Lululemon (LLL)
Income
o Focus on income generating investments – high dividends
o Eg: Canadian Oil Sands (COS), Gamehost (GH), REIT’s Boardwalk (BEI.UN)

22. Cycles & Seasonality
“My ears cannot listen longer than my
behind can endure”
-Ambrose Bierce

23. Business Cycle & Stock Market Cycle
Leading Indicators
TRAP
RBC & DOL

24. Global Industry Classification Standard

25. Challenging Returns in Junior Oil & Gas Space
Junior Oil and Gas companies outperform Large Caps over past 25 years

26. Asset Mix Decision
Long Canada Bonds vs. S&P/TSX Dividends
Short
Duration

27. Price to Earnings Multiples for S&P 500 & TSX
Valuations are Compelling
Current
Trailing P/E =
15.2 Canada,
14.2 U.S.

28. Types of Advisors
Investment Advisor Financial Planner Investment Counsellor
Client prefers:
Client prefers: Client prefers: Variety of investment
Variety of Products Variety of investment options
options Planning and portfolio
Specialization
Planning focus approach
Deal Flow
Advisory relationship Service focus
Active Involvement Fee based focus Fiduciary Relationship
Transaction based focus
Reporting: Fee based focus
Reporting: Monthly/Quarterly account Reporting:
Monthly account statements statements & fund performance Monthly account
statements, quarterly portfolio &
Cost: Cost: performance reports, customized
Average MER 2.56% benchmarks
1-3% of equity trade value Cost:
Declining DSCs 6%-1%
Spread on bond yields 1%-1.25% of AUM on a
1% fund trailer fees
1% fund trailer fees Declining fee schedule
Tax deductible

29. 12 Questions to Ask an Advisor
What are your qualifications?
What experience do you have?
How big is your book of business?
What services / products do you offer?
What is your approach to financial planning?
Will you be the only person working with me (other
partners lawyers, accountants, etc.)?
How will I pay for your services?
How much do you typically charge?
How many clients do you have?
Could anyone besides me benefit from your
recommendations (conflicts of interest)
Are you regulated by an organization?
Can I have it in writing?

30. Hiring an Advisor
Are you being heard?
Has your best interest at heart?
Can you have an honest open
conversation?
Are you being pressured into
making a decision?
Do you trust this person?
Use emotional intelligence and
your voice

31. Summary
FINANCIAL PLAN & GOAL SETTING
o Regardless of your situation
TYPES OF ADVISORS & EXECUTION
o Not alone, Not all or nothing
INVESTMENT STRATEGIES
o Constructing an “Investment Portfolio”
o “Asset Classes”
o Cash, “Fixed Income & Equities”
 Cash, Bonds & Stocks
CYCLES & SEASONALITY

32. Lesson
“We must be careful to
get only the knowledge
out of a lesson. The cat
who sits on a hot stove
top will never sit on a
hot stove again. But
she will never sit on a
cold one either.”
- Mark Twain

33. Questions & Answers
Personal & Private
Here until 2:00 ish
Or…….

34. Contact Information
Email: gbecker@matcofinancial.ca
Call: 403-718-2125
Blog: www.matcofinancialinc.com
Twitter: @Gwenbecker
Website: www.winkcalgary.com
WINK Facebook and LinkedIn Pages
Survey Monkey Honest Criticism is hard to take,
Particularly from a relative, a friend,
an acquaintance, or a stranger”
-Franklin P. Jones

35. Thank You
Guests
Directors
Family, Friends & Matco
BLG conference room
Door Prize donated by Studio
Gorgeous
Next Speaker
–Sharon Gray “Evaluating Assets”

36. Disclaimer
For your information:
MATCO FINANCIAL INC. is a privately owned and independent wealth management
office. The material presented is intended to provide information to Matco
Financial clients, contacts and affiliates. Readers should not act on this
information without first consulting their investment advisor, tax advisor, financial
planner or lawyer. This communication does not constitute an offer or solicitation
by anyone in any jurisdiction in which such an offer or solicitation is not
authorized or to any person to whom it is unlawful to make such an offer or
solicitation.
Management fees, commissions, and expenses may be associated with
investment management services and mutual fund investments. Before
investing, please read the applicable information such as the prospectus, which
contains detailed investment information and is available from your advisor. Most
marketable securities such as mutual funds are not guaranteed or insured, their
values change frequently and past performance may not be repeated. All
statements that look forward in time or include anything other than historical
information are subject to risks and uncertainties, and are not guarantees of
future performance. Investors should not rely on forward-looking statements.
Actual results, actions or events, could differ materially from those set forth in the
forward-looking statements.

37. 2011 & 2012 Global Market Returns (USD)

38. Volatility Index (VIX)
Height of pessimism

39. Seek lower volatility to enhance returns
LESS VOLATILITY = GREATER WEALTH
Consistent Investment: $1,000,000 Volatile Investment: $1,000,000
Year Rate of Return Ending Value Rate of Return Ending Value
1 8% $ 1,080,000 30% $ 1,300,000
2 8% $ 1,166,400 -20% $ 1,040,000
3 8% $ 1,258,712 25% $ 1,300,000
4 8% $ 1,360,489 -20% $ 1,040,000
5 8% $ 1,469,328 25% $ 1,300,000
Arithmetic annual
return 8% 8% (Net 40%/5)
Compound annual
return 8% 5.39%
Source: CEG Worldwide. Note: This is a hypothetical series of returns to indicate the significance
of volatility and does not represent any specific investments at any specific time.

40. Types of Advisors
Investment Advisor Financial Planner Investment Counsellor
IIROC Investment Counsel / PM
MFDA
CSC CFA, CIM, CFP
IFIC, CFP
Investment Dealer Portfolio Management
Mutual Fund Dealer Firm
Agency relationship Agency Relationship Investment Policy
KYC KYC Statement
Domestic & US Domestic, International & Domestic, US &
Stocks, Bonds, Mutual Specialty Mutual International stocks,
Funds, IPOs, Insurance Funds, Insurance bonds & Specialty pooled
Commission and some Fee Front end load, DSC & funds
based compensation Trailer Fee compensation Fee based compensation
as a % of assets

41. Investor vs. Trader (doesn’t work with a Plan)
Fundamental (Buy and Hold)
o Look at everything from financial statements, industry statistics to
broader economic environment to gain insight on company’s future
performance
Technical (Active)
o Study historical stock price and market behaviour. Look for recurring
patterns in charts to time purchases and sales of securities
Quantitative
o Screens and factors based on metrics and ratios drive investment
selections. Agnostic to company specifics often
Top Down vs. Bottom Up
o Focus on macro environment or company specific

42. Current Asset Mix (tactical)
Underweight Bonds
Overweight Equities (Stocks)
Market Weight (Canadian Equities)
Overweight (Global Equities US in particular)

43. Market Outlook
Bond Bull Ends
Dividend growth over income
China – Looking to Regain its Swagger
Europe – Back from the Brink
US Energy Independence
LNG – Closer to reality
US Recovery Gains Traction
Canada Faces Headwinds
Canadian Housing Feels the Chill
Valuations Expand