Appendix A: Investment Options

Investment Option Investment Option Description Specified Investment Option Benchmark where not provided in Section 3.04(b) Date Investment Option Added to GRRSP
Target Date Funds
Manulife Retirement Date Funds Invests in a combination of underlying Manulife funds using an asset allocation strategy designed for investors expecting to retire based on the specific date of the fund.  The maturity dates of the funds are 2015, 2020, 2025, 2030, 2035, 2040, 2045, 2050 Rolling benchmark for each Retirement Date Fund based on projected allocation as at a specific date As at inception date of this policy
Balanced Funds
Greystone Balanced Growth. Greystone bonds and growth-biased Canadian and US equities.  International component sub-advised 50/50 by Goldman Sachs Structured International and Hansberger International Growth 35% S&P/TSX, 12.5% S&P 500,  12.5% MSCI EAFE, 37% DEX Universe Bond, 3% DEX 91-day T-Bills 2008
Jarislowsky Fraser Balanced GARP, but tends to have more of a value bias than traditional GARP managers. Gradual asset mix shifts based on economic outlook, capital markets and political environment.  Benchmark asset mix is slightly more conservative with 45% fixed income 30% S&P/TSX, 12.5% S&P 500,  12.5% MSCI EAFE, 39% DEX Universe Bond, 6% DEX 91-day T-Bills As at inception date of this policy
Leith Wheeler Diversified Value.  Leith Wheeler bonds and value-biased Canadian equities.  US and International components sub-advised by Sprucegrove (value-biased) 30% S&P/TSX, 15% S&P 500,  15% MSCI EAFE, 35% DEX Universe Bond, 5% DEX 91-day T-Bills 2009
Canadian Equity Funds
McLean Budden Canadian Equity Growth GARP.  Bottom-up approach with strict sector constraints.  A majority of the 40 to 50 stocks in the investment option are chosen from the largest 100 Canadian companies S&P/TSX Capped (CPMS) Index As at inception date of this policy
MFC Global Canadian Large Cap Value Equity Value. Bottom-up approach.  Sub-advised by MFC Global.  Invests primarily in Canadian large-cap companies   As at inception date of this policy
Jarislowsky Fraser Canadian Equity GARP but tends to have more of a value bias than traditional GARP managers.  Bottom-up approach.  Mostly invested in large cap stocks in non-cyclical industries.  Also invests portion of the fund in the Jarislowsky Fraser Special Equity Fund for small cap exposure   As at inception date of this policy
Bond Funds
MFC Global Canadian Bond Index Passive.  Aims to track the performance of the DEX Universe Bond Index.  Creates a portfolio of bonds with all the same characteristics as the Index   As at inception date of this policy
PH&N Bond Invests in high quality government and corporate bonds with a quality rating of BBB or higher.  PH&N has a controlled approach to duration, generally maintaining it within +/- 0.5 year vs. the index duration   As at inception date of this policy
U.S. Equity Funds
MLI U.S. Diversified Growth Equity (Wellington) Growth. Bottom-up approach.  Emphasizes a balance of growth, valuation, and quality criteria when selecting stocks in the large cap spectrum of the US market Russell 1000 Growth Index ($Cdn) 2009
BlackRock US Equity Index Passive. Aims to track the performance of the S&P 500 Index in Canadian dollars net of withholding taxes. Creates a portfolio that fully replicates the Index S&P 500 Index ($Cdn) 2009
Global Equity Funds
Fidelity Global Equity Core-Growth.  Bottom-up approach.  Regional portfolio managers invest in different markets and regions around the world including emerging markets.  Typically holds approximately 150 securities MSCI All-Country World Index ($Cdn) As at inception date of this policy
JP Morgan Global Intrepid Core.  Seeks to exploit investor behavioural patterns.  The portfolio will generally have a high exposure to short and medium term momentum. The strategy will invest in the best value and growth ideas resulting in a broadly style neutral portfolio MSCI World ex-Canada Index ($Cdn) 2010
International Equity Funds
Sprucegrove International Equity Value. Bottom-up approach. Emphasizes quality followed by attractive valuations relative to the stock’s history.  Typically holds 100 – 140 securities.   2010
Money Market and GICS
MFC Global Canadian Money Market Sub-advised by MFC Global. Invests in short-term fixed income securities maturing within 2 years, including securities issued by Canadian governments, chartered banks and corporations   As at inception of this policy
1-, 3-, and 5-year Guaranteed Investment Certificates Guaranteed Investment Certificates promise the investor a specified rate of return over a set period   As at inception date of this policy

Default Investment Option: Manulife Retirement Date Funds

The Recordkeeper will, in absence of investment instructions from the plan member, use the Manulife Retirement Date Fund with a maturity date closest to the plan member’s 65th birthday for investment of the assets.

Glossary of Investment Terms

Active
Management
An active manager invests the assets of a fund with the objective of outperforming a broad-based index, or a combination of broad-based indices as in the case of a balanced fund.  The manager will buy and sell specific securities, and will also shift the mix of the portfolio in an attempt to outperform the appropriate index.

 

Bottom-up The “bottom-up” approach focuses on stock selection, based on the outlook for each specific company.

 

Core A core management style does not have a strong value or growth bias but will have portfolio characteristics generally in-line with the index.

 

GARP “Growth at a reasonable price.”  A GARP oriented manager will generally hold a portfolio with a growth bias, but generally will not overpay for these “growth” stocks.

 

Growth Growth investing refers to a process that focuses on companies with higher than average historic (and projected) earnings per share.  These companies will tend to have high price to earnings ratios and low dividend yields.

 

Passive Management A passive or index manager invests the assets of the portfolio to match the characteristics and performance of a broad-based index such as the S&P/TSX Composite Index.

 

Top-down The top-down approach looks at the economy and its current stage in the business cycle.  From this assessment, the manager will then determine what sectors of the market or regions are likely to perform the best and weigh the portfolio accordingly.

 

Value A value investor will look for good companies with strong balance sheets that are currently undervalued by the market.  These companies will often have low price-to-book value ratios, low price-to-earnings ratios and high dividend yields.

 

[whohit]Investment Policy Statement: Appendix A[/whohit]
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