1. Thank you
My role
Why are we here? We’re talking about a new way of managing a portfolio. It’s not about finding the next hot dot or a way to time the market, rather it’s driven on risk management through the use of multiple investment managers, styles and assets.

2. The evolution of wealth management
Mutual funds/pools
Until the 1990s, most individual investors could only access institutional-calibre money management through funds and pools.
While convenient and accessible, they offer limited customization, flexibility and control.
Access professional money managers first through mutual funds
Buy a unit of the pool
Don’t own stocks directly
No transparency 2

3. The evolution of wealth management
The Separately Managed Account (SMA)
Provides customized, tax-efficient portfolios each individually managed by carefully screened world-class managers.
Limited ability to overlay a consistent high-level asset allocation strategy across all the separate portfolios in one account.
SMA allows for same professional management but you can see the stocks
Allows for certain levels of customization (i.e. avoid certain securities or industries) 3

4. The evolution of wealth management
The Unified Managed Account (UMA)
The UMA builds on the SMA’s advantages, accurately and efficiently overlaying an asset allocation strategy to all the manager portfolios/models in a single custody account.
It can also hold individual mutual funds, pools and ETFs – and apply the overarching asset allocation to these as well.
The Unified Managed Account (UMA) allows you to combine the disciplined process of Parameters with complimenting money managers, mutual funds or ETF’s while ensuring your portfolio is automatically rebalanced each quarter to match the tactical recommendations of our RBC Investment Strategy Committee.
A multi-manager approach will help to reduce some of the single-manager risk and smooth out your experience from quarter to quarter. 4

5. The evolution of money management
You benefit from more precise asset allocation and rebalancing to manage risk, plus consolidated reporting across all asset classes.

6. Welcome to A+ – the next level of wealth management
A+ is a new portfolio management system that combines a professional investment process, partnership and peace of mind.
Your A+ Portfolio synthesizes the most current thinking of RBC’s senior portfolio strategists with carefully evaluated investment ideas from elite money managers worldwide.
A+ is designed to replace the emotions and guesswork of investing with a strictly rational and decisive approach suitable for your core investment assets.
A+ allows you to access the best thinking within RBC and it’s partners
Combines the efforts of our strategy committee with a list of carefully screened money managers, mutual funds and ETF’s

7. What are the key benefits of A+?
Professional process
“Pension-like” portfolio management
Partnership
Match your goals / preferences with your portfolio
Peace of mind
Continuous oversight
Why is it important to use A+? You will benefit in 3 key areas
Access a style of managing money that has previously been reserved for Pension accounts. Gives tactically rebalanced portfolios each quarter, screened investment options and full detailed reporting on the entire portfolio.
Focus on the things that are important to you: do I have enough money to retire? Will I have enough income to maintain my current lifestyle? What legacy can I leave my children and grandchildren? … Take the focus away from why we buy and sell TD vs. RY and make sure your “serious money” is working towards the same goal.
If a money manager leaves one of your investments, how do you know unless it hits the newspaper? Our managers are required to notify us of any changes in structure or risk being removed from our platform as well as other firms platforms.

8. The importance of asset allocation
The asset allocation between equities, fixed income and cash is the main factor determining your portfolio’s risk/ return tradeoff.
Everyone has an optimum asset allocation range based on factors such as their stage in life and their personal comfort level with risk.
Strategic asset allocation within these ranges can add significant value over time.
Your portfolio’s actual asset allocation can drift outside your ideal ranges over time – if left unchecked.
The RBC Investment Strategy Committee provides strategic asset allocation quarterly, which is automatically applied to your A+ Portfolio, both to add value and to keep you within your optimum ranges to reduce risk.
Asset allocation will affect the long term returns in your portfolio
More fixed income, less volatility
More equity, more volatility

9. The importance of Asset Allocation
This study shows that 91.5% of the VOLATILITY of a portfolio can be explained by the Asset Mix. That is different from the % attribution asset mix has towards the RETURNS of a portfolio. The asset mix of the portfolio accounts for 85 – 110% of the portfolios RETURN. That means if the attribution is over 100% then the money managers used have been a negative influence on the portfolio (i.e. we would have been better off buying an index fund). 9

10. Varying asset class returns causes asset allocation drift
Last 10 years … shows that Canadian Large Cap stocks have been the second most volatile asset class to invest in … the average DS client is significantly overweight in Canadian equity, even for a Canadian.

11. Asset class diversification helps removes guesswork
Past performance tells us that we cannot pick the winners … another reason to diversify

12. Subtracting emotions, adding reason
A+ helps you avoid the guesswork and emotions that plague the common investor.
Benefit from a professionally managed, highly disciplined process that employs purely rational criteria for all investment decisions made on your behalf.
This process is designed to provide consistent, long-term value, while reducing risk through precise diversification and regular asset mix rebalancing.  
Having a defined process, like we have in Parameters, helps us identify not only when to BUY a stock but more importantly when to SELL a stock or when to DO NOTHING.
We are our own worst enemy when it comes to investing …

13. The real cost of emotional investing
Individual investors tend to underperform the markets, largely because they make
frequent changes in response to market fluctuations.
Source: Quantitative Analysis of Investor Behavior (Dalbar Inc., 2009). Returns include reinvestment of dividends, but do not assume any transaction costs, taxes, management fees, or other expenses.
Average equity investor
S&P 500
8.4%
1.9%
This study has been updated many times over the years and the numbers have changed, but the gap between an individuals returns and the index has remained large no matter what the time period.

14. The A+ framework for success
The A+ Portfolios framework is comprised of two key components:
1. Aligning your portfolio’s overall asset allocation with the most current thinking of our RBC Investment Strategy Committee.
The result – a rational framework for investment decision-making that removes the emotions and guesswork from investing.
2. Populating your portfolio with carefully chosen investments to achieve your individual financial goals.
The process we employ in A+ is similar to that of Parameters. We combine the macro-economic views of our RBC Investment Strategy Committee with a disciplined approach to selecting what we invest our portfolios in.

15. The A+ strategic framework
Your A+ Portfolio is aligned with the recommendations of our RBC Investment Strategy Committee.
Based on its outlook for the global markets and economy, the Strategy Committee determines optimum portfolio allocations between the three major asset classes, sectors of the economy and geographic regions.
Using our next-generation UMA technology, we automatically apply the Strategy Committee’s findings to your A+ Portfolio on a quarterly basis to maintain your optimum asset allocation.
The recommendations from RISC will flow into A+ via 5 model portfolios ranging from Income to All Equity. The committee will provide you’re A+ account with a quarterly asset mix recommendation and our overlay portfolio manager (the person who trades the account) will rebalance your portfolio accordingly.

16. The A+ tactical framework
We identify the specific managers for your A+ Portfolio, in addition to funds, pools or ETFs that may help round it out. Finally, we utilize UMA technology to align all these investments with your optimum asset allocation.
We invite a select group of money managers from RBC’s research universe to provide model portfolios for specific A+ mandates. We continually monitor these managers and, in the event one no longer meets our strict criteria, identify a suitable replacement.
The RBC Global Advisory Research Group conducts ongoing independent research on over 4,000 quality managers worldwide.
The bottom up process is multi-layered with several different committees providing research & input. Our money managers are screened by a third party company, Prudential Investments. Prudential has a stand alone department called Strategic Investment Research Group (SIRG) who will filter thousands of managers globally into a universe of approx RBC then picks from the screened universe of 200 to build our investment platform.
Our Mutual Funds are screened by a RBC group (MF Research Group) to ensure they continue to meet our high standards for investment as well as having a low MER.
ETF’s are screened for low tracking error and low MER’s across 3 main firms: Barclays, Vanguard and Claymore.
A+ mandates meet investor objectives such as long-term wealth creation, income generation and capital preservation.

17. The Results Recommended Model Portfolios 5 asset allocation models
4 investment tiers
Global, Canadian and Income subsets
Total of 42 Models
Investment Menu
All investments on the menu have been carefully selected
On-going research
“Worth Knowings”
The results of our top down / bottom up process is 42 recommended model portfolios.
We have 5 asset classes, different investment tiers and different geographic focuses that make up the 42 models

18. Balanced Portfolio Example @ $1,000,000 CAD
Portfolio Sample
Balanced Portfolio $1,000,000 CAD
ASSET CLASS
FULFILLMENT
Canadian Fixed Income %
Laketon Fixed Income
Cdn Short Term FI 6%
TD Short Term Bond Fund
Global Fixed Income 8%
RBC Global Private Bond Pool
Canadian Equity %
Jarislowsky Fraser Canadian Equity
Parameters Canadian Equity
Sample portfolio … Change Parameters to Jarislowsky Fraser.
US Large Cap Equity %
Earnest US Large Cap Core
International Equity %
Philadelphia International Equity
Emerging Markets 1%
AGF Emerging Markets Fund 18

19. A+ account features Reporting
Receive an in-depth A+ Portfolio Monitor every quarter detailing your integrated asset mix among multiple asset types, overall portfolio performance, as well as transactions made during the quarter.
Tax benefits
We can tailor your A+ Portfolio to accommodate your individual tax situation, for example, by harvesting capital losses that can offset taxable capital gains and reduce your taxes. In addition, we can hold securities with a low book cost in your A+ account until you are ready to sell, thereby deferring potential capital gains taxes.
Portfolio customization
We can apply personalized screens to your A+ Portfolio to restrict certain companies or sectors of the economy, such as tobacco, military or alcohol. 19

20. Why A+? Professional process “Pension-like” portfolio management
Partnership
Match your goals / preferences with your portfolio
Peace of mind
Continuous oversight 20

21. Thank you
ACCESS+ accounts are not guaranteed by RBC Dominion Securities Inc. Since these accounts are not suitable for all clients, RBC Dominion Securities Inc. needs to review your investment objectives, risk tolerance and liquidity needs prior to accepting an application to open an account. ACCESS+ accounts are subject to minimum investment requirements. RBC Dominion Securities Inc.* and Royal Bank of Canada are separate corporate entities which are affiliated. *Member–Canadian Investor Protection Fund. ® Registered trademark of Royal Bank of Canada. Used under licence. RBC Dominion Securities is a registered trademark of Royal Bank of Canada. Used under licence. © Copyright All rights reserved.