July - Summer Edition - CI Investments

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Commentary However, if investors were truly concerned with financial collapse in Europe, the euro would not be holding up as well as it has. The euro could yet collapse or it may rally to new highs – making a prediction is not the objective of this analysis. The point is that, rightly or wrongly, the euro exchange has yet to flash a crisis signal. In a similar vein, European sovereign debt concerns have not yet triggered a material decline in the U.S. Financial Conditions Index as they did one year ago (Chart 2). This is a bit surprising, particularly given recently heightened concerns of a slowdown in China over inflationary risks. Additionally, the world’s third-largest economy, Japan, is acting as an economic drag in the wake of the Fukushima disaster. And yet, financial conditions remain positive within the U.S., whereas one year ago they had turned negative. Note that the chart illustrates the immense size of the financial earthquake in the fourth quarter of 2008 and the ensuing aftershocks, thus providing some perspective. Importantly, the aftershocks are getting smaller. Perhaps the forces of healing have taken hold as we move towards the three-year anniversary of the collapse of Lehman? Corporate balance sheets of North American companies are in phenomenal condition, providing the economy with a basis of financial stability that simply did not exist three years ago. While economic growth has been sluggish and U.S. employment lags, S&P 500 earnings per share are estimated to reach a record level of US$99.27 this year, surpassing the previous record of US$84.67 set in 2007. Equities are cheap. During the lows of late June, the S&P 500 was trading at its second-lowest price-to-earnings ratio (on 2011 estimates) since 1985. The only time, since 1985, the U.S. market was cheaper was during the panic sell-off that occurred in the six months after Lehman’s collapse. Even the much-maligned U.S. consumer is in better shape. According to Equifax, average credit scores in June reached their highest level in over four years. So, while U.S. federal deficits continue to expand, corporations and consumers are improving their financial conditions. Eventually, the U.S. government will need to get in on the act, and we will see what happens with the debt ceiling negotiations this summer. Deleveraging is a continuous process and investors should expect more aftershocks. However, they should not forget that bull markets are characterized by two steps forward followed by one step back. Overall, positive fundamentals – continued liquidity, good valuation support and restrained sentiment – outweigh the negative macro risks and the market is prepared for a step forward. Bloomberg U.S. Financial Conditions Index 2 0 -2 -4 -6 -8 -10 -12 -14 Dec. 2006 Jun. 2007 Dec. 2007 Jun. 2008 Dec. 2008 Source: Bloomberg. As of June 30, 2011. Jun. 2009 Chart 2: The current Greek crisis and concerns over European sovereign debt has not triggered a material decline in the U.S. Financial Conditions Index – as it did a year ago. Managers: Aaron Clark, Alec MacIsaac Analysts: Ben Boult, Steve Maksymyk Dec. 2009 Crisis I Jun. 2010 Dec. 2010 Crisis II Jun. 2011 36 SUMMER 2011 PERSPECTIVE AS AT JUNE 30, 2011
In choosing the Fund Manager of the Decade, the analysts at Morningstar Canada surveyed the records of hundreds of money managers. As they went through this process, one person stood out: Eric Bushell, Chief Investment Officer of Signature Global Advisors. SUMMER 2011 PERSPECTIVE AS AT JUNE 30, 2011 37
Page 1 and 2: www.ci.com/perspective Summer 2011
Page 3 and 4: Summer 2011 Dear Advisor, CI Invest
Page 5 and 6: Introducing Black Creek That gives
Page 7 and 8: Introducing Black Creek [Q] Why hav
Page 9 and 10: Book reviews Book reviews Settling
Page 11 and 12: Book reviews NON-FICTION: The Big S
Page 13 and 14: Book reviews Brandon Snow Principal
Page 15 and 16: Book reviews Malcolm White Vice-Pre
Page 17 and 18: Portfolio Snapshot Performance YTD
Page 23 and 24: Signature Market Roundup Interest r
Page 25 and 26: Signature Market Roundup Consumer p
Page 27 and 28: Signature Market Roundup Global ind
Page 29 and 30: Signature Market Roundup High-yield
Page 31 and 32: Commentary In addition to the above
Page 33 and 34: Commentary eBay and Wienerberger. C
Page 35 and 36: Commentary Stephen Jenkins Senior V
Page 37: Tetrem Capital Management Ltd. Comm
Page 41 and 42: Fund Facts as at June 30, 2011 Fund
Page 73 and 74: Summary of capped funds MUTUAL/HEDG
Page 75 and 76: CI Corporate Class cont’d LEAD MA
Page 77 and 78: Portfolio Select Series LEAD MANAG
Page 79 and 80: CI GIFs (Class A units) 1 Issued by
Page 81 and 82: Clarica MVP Segregated Funds LEAD M
Page 83 and 84: Clarica Portfolio Segregated Funds
Page 85 and 86: SunWise ® I Funds Full Guarantee c
Page 87 and 88: SunWise ® II Funds Basic Guarantee
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SunWise ® II Funds Combined Guaran
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SunWise ® II Funds Full Guarantee
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SunWise ® Basic Guarantee Elite Fu
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SunWise ® Elite Funds Combined Gua
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SunWise ® Full Guarantee cont’d
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SunWise ® Investment Class Essenti
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SunWise ® Estate Class cont’d Es
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