Roberts Nash Advisory Group

Managed Yield (M.Y.) Private Portfolio

National Bank Financial Wealth Management – 802-380 Wellington Street, London ON N6A 5B5

Tel.: 519-646-5700 • Toll Free: 1-855-301-5700 • Fax: 519-645-4896 • Email: robertsnashgroup@nbf.ca

February 28, 2017

Kelly Roberts, BSc. CIM, FCSI Senior Vice President Investment Advisor /Portfolio Manager

Jay Nash, BA, CIM, FCSI Vice President Investment Advisor / Portfolio Manager

Management Philosophy

The Managed Yield Private Portfolio was established to provide investors with stable, tax efficient returns. It focuses on dividend paying securities. The objective of the fund is to provide long term returns in-line with a growth benchmark (70% equity) while maintaining a reduced level of volatility. This portfolio will:

Focus on value oriented Canadian & global equities

Diversify using exchange traded & closed end funds

Aim to capitalize on inefficiencies within the closed end market

Target tax efficient income generation

Only hold exchange listed securities

Top 10 Holdings (59.4% of total portfolio)

Symbol Symbol Description Portfolio Weight Income Yield

ZDY BMO US DIVIDEND ETF 7.8% 2.9%

HAB HORIZONS ACTIVE CORPORATE BOND ETF 7.5% 3.4%

EIF’ZF EXHANGE INCM CV RD 5.35% 31/03/20 6.6% 5.2%

JE'ZB JUST ENERGY GROUP INC 5.75% 09/30/18 6.4% 5.7%

HPR HORIZONS ACTIVE PREFERRED SHARE ETF 5.5% 4.2%

MSFT MICROSOFT CORP 5.4% 2.4%

RY ROYAL BANK OF CANADA 5.3% 3.4%

BIP.UN BROOKFIELD INFRASTRUCTURE 5.2% 4.8%

VXM.B FIRST ASSET MS INT’L VALUE ETF 5.2% 1.8%

CPX CAPITAL POWER CORPORATION 5.1% 6.2%

1 month 3 Months 6 Months 1 Yr 3 Yr Inception Performance 1.7% 5.5% 11.7% 25.4% 10.6% 11.5% Benchmark 2.2% 3.1% 3.9% 12.2% 7.8% 9.1%

Fees: Returns presented are before fees

Composition of the benchmark: NBFWM Growth Benchmark is composed of 35% DEX Universe, 20% S&P/TSX Total Return, 20% S&P 500 $CAD Total Return Index; 15% MSCI EAFE Total Return Index; & 10% Alternative (made up of Credit Suisse Tremont Hedge Fund Index; Thomson Reuters/Jeffries CRB Commodity Index; S&P Global Infrastructure Index; & FTSE EPRS/NAREIT Global Real Estate Index; all $CDN)

Other Characteristics: Inception Date: April 1, 2012 Initial Investment: $40,000 Distributions Made: $1,800

Portfolio Income Yield: 4.09% Current Investment: $62,779

Geographic Asset Allocation Industry Weightings

Portfolio Manager’s Comments

The Managed Yield portfolio enjoyed its 8th consecutive month of positive return in February gaining 1.7%. Global equity markets were strong, and foreign exposures were a big contributor. We continue to believe that inflation and interest rates will rise during 2017. Expectations of an interest rate increase in the US have jumped from about 25% at the start of February to over 80% today. If the Federal Reserve decides to raise the rate this would mark the second increase in less than 4 months (but only the 3rd increase in over 10 years). We are conscious of maintaining positions within the portfolio that should benefit from rising interest rates (like Manulife Financial), though we don’t expect to see an increase from the Bank of Canada until 2018. Within the portfolio we bought back Exchange Income 5.35% 2020 debentures. The units had traded down since they were sold in November, and were once again at an attractive level. We also took advantage of price weakness to switch from Inter Pipeline (IPL) to AltaGas (ALA) as they proceeded with a significant US acquisition.

Recent Transactions: Position

February

Trimmed Up Sold

Bought

Exchange Income Corp 5.35% 31MR20 (EIF.DB.F)

Inter Pipeline Ltd (IPL) AltaGas Ltd (ALA)

January Sold Trimmed Down

Algonquin 5% 31MR26 (AQN.IR) Manulife Financial (MFC)

December

Trimmed Down

Bought

National Bank (NA)

Capital Power (CPX) Crombie REIT (CRR.UN)

2.7%

25.6%

48.6%

13.3%

9.7%0.0%

Cash & Equivalents

Fixed Income & Equivalents

Canadian Equity

US Equity

Global Equity

Other

8.1%2.4%

16.4%

4.3%

1.9%

0.9%23.9%

10.7%

0.5%

23.9%

7.0% EnergyMaterialsIndustrialsConsumer Disc.Consumer StaplesHealth CareFinancialsITTelecomUtilitiesReal Estate