CF CANLIFE STRATEGIC RETURN FUND
DRAFT PARAGRAPHS FOR SUITABILITY LETTER
For professional adviser use only
Data correct as at 30/06/2014
Important note to advisers:
These sample paragraphs are for your information and consideration only. It is your
responsibility to ensure that any letters sent to your clients meet the requirements of your
regulatory authority and that any recommendations made are appropriate for your client.
No liability is accepted by Canada Life Investments in connection with your use of any of
these suggestions.
You may wish to refer to the FCA’s guidance on the use of standard paragraphs in
suitability letters, and the importance of reflecting factors specific to your client's
circumstances:
http://www.fca.org.uk/static/fca/documents/fsa-improving-quality-of-advice.pdf
For further information:
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Contact your Canada Life Account Manager
Email contactCLInvestments@canadalife.co.uk
Call Canada Life Investments on 020 7415 6549/6482
Visit www.canadalifeinvestments.com
Worries of market volatility remain
With memories of 2008’s market volatility still fresh in investors’ minds, there is demand for longterm investment solutions that are designed to perform through varying market environments.
Stock markets have been on a strong run since 2009 and volatility has fallen to low levels. Both of
these factors have raised the expectation of increased volatility in the near future – or worse, a
market correction.
When markets become more volatile, investors often face a bumpy ride that can see the value of
their investments rise or fall sharply over a short period of time. If the objective is to generate a
stable return over the long term, it is necessary to invest in a broad range of assets that spread
risk evenly throughout the portfolio. A diversified blend of assets should participate in the upside
of markets as they rise and protect against losses when they fall. The CF Canlife Strategic Return
Fund’s portfolio is diversified for a smoother journey and aims to achieve long-term growth by
balancing risks and targeting a specific volatility range.
CF Canlife Strategic Return Fund: A different approach to balancing risk and return
Canada Life Investments has partnered with PanAgora Asset Management to offer the CF
Canlife Strategic Return Fund. This fund invests in a range of globally diversified assets and aims
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to generate a positive return of cash + 5% pa over a period of at least five years while targeting a
moderate level of volatility (7.8-10.4% on an annualised basis).
Investors are typically compensated for taking risk, but too much risk could result in heavy losses
and too little risk could mean that an investor’s portfolio falls short of meeting its objective.
However, the traditional way of constructing a diversified portfolio, where 60% is in shares and
40% is in bonds, causes too much risk concentration. In this scenario, shares represent 90% of
the risk.
To address this problem, the investment team believes that diversification is the key to managing
risk exposures and generating attractive risk-adjusted returns over the long term. Decisions are
based on the allocation of risk to each asset class, rather than the allocation of money, as is the
case in a traditional portfolio. In order to ensure that the fund generates its intended return, the
management team targets a specific volatility range by balancing the risks associated with being
exposed to financial markets as well as specific asset classes (for example, bonds, equities, etc).
In order to balance risks and achieve the right amount of exposure to these asset classes, the
fund is almost wholly invested through derivatives at present. The management team believes
that this approach should generate attractive returns that offer more stability and greater
downside protection when compared to other, more concentrated, approaches to investing.
Experts in risk management
The CF Canlife Strategic Return Fund is managed by PanAgora Asset Management’s Multi Asset
investment team. Based in Boston, USA, the team consists of 13 experienced and talented
investment professionals with complementary skills and experience. PanAgora strongly believes
in a team approach to investment management. While certain team members focus more
specifically on a particular investment category, such as equity, fixed income, or commodities,
each team member is expected to contribute to the investment insights and intellectual property
of the aggregate group. As of 31 December 2013, PanAgora managed approximately £23bn on
behalf of more than 125 institutional clients worldwide.
Canada Life Investments
Canada Life Investments is a UK-based asset manager responsible for managing more than
£30bn of equities, fixed income and property1. It has been active in the UK for more than 100
years, having first established its life insurance business here in 1903. As an asset manager,
Canada Life Investments focuses on the long term and believes that active management is the
best way to add value for clients and generate superior returns. Its parent company, Great-West
Lifeco, is one of Canada’s largest financial companies with £433bn in consolidated assets under
administration2. By being part of a much larger group, it is able to draw on a pool of expertise and
resources that enable it to better serve its clients and help them to meet their objectives.
The CF Canlife Strategic Return Fund is part of Canada Life Investments’ Global Partner Series.
This is a suite of funds created in partnership with companies within the Great-West Lifeco group
and associated companies in Canada, the US and Ireland. The Global Partner Series funds are
only available through Canada Life Investments in the UK, providing access to innovative asset
classes and unique investment opportunities.
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As at 31/03/14
As at 31/12/13
Warnings:
 The fund aims to achieve a positive return that is independent of prevailing economic or
market conditions over a rolling period of at least 5 years. Capital is at risk and there is no
guarantee that a positive return will be delivered over that or any time period.
 The fund maintains high levels of UK and US government debt securities and cash which
serve as margin or collateral on the derivative positions. Derivatives are complex
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instruments which may result in gains or losses that are greater than the original amount
invested.
Due to the portfolio composition and/or portfolio management techniques used by the
fund manager, the net asset value of the fund is classed as having above average
volatility.
Past performance is not a guide to future performance. The value of investments may fall
as well as rise and investors may not get back the amount invested. Income from
investments may fluctuate.
Credit Risk: Fixed interest securities are affected by trends in interest rates and inflation.
If interest rates go up the value of capital may fall and vice versa. Inflation will also
decrease the real value of capital. The value of a fixed interest security is also affected by
its credit rating.
Counterparty Risk: The fund may enter into derivative agreements and there is a risk that
other parties may fail to meet their obligations leading to delays in receiving amounts due
or receiving less than is due.
Currency Risk: As the fund invests in global securities, movements in exchange rates
may, when not hedged, cause the value of your investment to increase or decrease.
For full details of the fund's risks, please see the latest prospectus and the Key Investor
Information Document (KIID) available at www.canadalifeinvestments.com.
PLEASE NOTE THAT YOU SHOULD SATISFY YOURSELF OF THE EFFECTIVENESS OF THIS
MATERIAL. CANADA LIFE INVESTMENTS ACCEPTS NO RESPONSIBILITY FOR THE USE OR
OTHERWISE OF THESE SUGGESTED PARAGRAPHS.
Canada Life Investments is the brand for investment management activities undertaken by Canada Life Asset Management Limited, Canada Life Limited and
Canada Life European Real Estate Limited. Canada Life Asset Management Limited (no. 03846821), Canada Life Limited (no.00973271) and Canada Life
European Real Estate Limited (no. 03846823) are all registered in England and the registered office for all three entities is Canada Life Place, Potters Bar,
Hertfordshire EN6 5BA. Canada Life Asset Management is authorised and regulated by the Financial Conduct Authority. Canada Life Limited is authorised by the
Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority.
ID 6367 0714R Expiry July 2015
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