Principal Protected Notes
All-Star Portfolio Notes, Series 2
- Product Summary
- Performance
- Underlying Mutual Funds
- Commentary
- Purchase
- The Guarantor
- Downloads
- Additional Information
Product Summary
| Inception Date | December 4, 2003 |
| Maturity Date | December 31, 2012 |
| Offering Price | $10.00 |
| Guarantee Amount | $...... |
| Market Price Per Note | $...... |
| Investment Exposure as at June 30, 2009 | 0% |
The ONE Financial All-Star Portfolio Notes™, Series 2 have been developed by ONE Financial to provide conservative investors with the opportunity to access a diversified portfolio of top-performing mutual funds, with the comfort of a 100% principal guarantee plus a guaranteed minimum payment of 7% at maturity. The Notes provide a simple portfolio solution; a diversified portfolio of five top-performing mutual funds with 107% principal guarantee at maturity, plus the potential for leveraged returns.
- 100% principal guarantee plus a 7% guaranteed minimum coupon at maturity
- Five All-Star Funds: CI Global, AGF International Value, AIC Diversified Canada, AIC American Focused, and CI Canadian Bond
- 100% RRSP eligible as Canadian property
- Tax deferral of Portfolio returns – no annual distributions
- Historical pro-forma average returns are 10.7% per annum
- Initial Closing Date: November 28th, 2003
Investment Details
| Style | Mutual Fund / Principal-Guaranteed |
| Underlying investment | AGF International Value Fund, CI Global Fund, CI Canadian Bond Fund, AIC American Focused Fund, AIC Diversified Canada Fund |
| Guarantor | BNP Paribas S.A. (Rated AA by S&P) |
| Administrator | ONE Financial |
| Leveraged return potential | Yes, up to 150% "performance-based" investment exposure |
| Liquidity | Weekly |
| RSP eligibility | 100% (Canadian content) |
| Performance | as at June 30, 2009 |
| Returns | as at June 30, 2009 |
| 1 Month | -2.46% |
| 3 Months | -4.18% |
| 6 Months | -7.95% |
| Year-To-Date | -7.95% |
| 1 Year | -0.03% |
| 3 Year (annualized) | -1.48% |
| 5 Year (annualized) | -2.09% |
| Total Return since Inception | -12.46% |
| Initial Price | $10.0000 |
| Current Price | $8.7540 |
| Diversification by Manager | as at June 30, 2009 |
| Fund | Targeted % Portfolio Allocation | Manager | Style | Investment Selection Process | Region |
| AGF Global Value Fund | 25% | John Arnold, Rory Flynn, Yvonne Brett, Richard McGrath | Value | Obtain superior long-term capital growth; invests primarily in equity securities of companies around the world; bottom-up value investment style to uncover stocks believed to be trading at a discount to their intrinsic value. | Global |
| CI Global Fund | 25% | Bill Sterling, Greg Gigliotti & Robert Beckwitt | Value/Growth Blend | Maximum long-term capital growth by investing in established companies located throughout the world that have good prospects for future growth. | Global |
| CI Signature Canadian Bond Fund | 10% | James Dutkiewicz | Income | Combines interest rate anticipation, yield curve analysis, credit quality and individual security selection strategies in managing. Invest primarily in government securities. | Canada |
| AIC American Focused Fund | 20% | Ariel Capital Management, LLC | Value | Capital preservation and appreciation through investment in a select number of U.S. Equities | U.S. |
| AIC Diversified Canada Fund | 20% | Jonathan Wellum & Aman Budhwar | Value/ Growth Blend | Maximize returns while preserveing capital; primarily Canadian equities, across industry sectors characterized by strong growth | Canada |
Underlying Mutual Funds
- AGF International Value Fund
- CI Global Fund
- CI Canadian Bond
- AIC American Focused Fund
- AIC Diversified Canada Fund
| Commentary | as at June 30, 2009 |
The ONE Financial All-Star Portfolio Notes, Series 2 (the "Notes") are linked to a portfolio of five all-star mutual funds managed by experienced managers (the "Portfolio"). Each of the funds selected for the Portfolio were chosen for their excellent longterm track records of delivering strong, consistent performance. Since the inception date of the Notes, the performance of each of the funds has been: -28.9% for the AGF Global Value Fund (formally the AGF International Value Fund), -50.3% for the AIC American Focused Fund, 22.1% for the CI Signature Canadian Bond Fund, -17.0% for the CI Global Fund, and -2.5% for the AIC Diversified Canada Fund.
Most equity markets around the globe experienced growth in the second quarter of 2009. The S&P 500 was up 15.2%, the MSCI Far East was up 21.9%, while the MSCI Europe was up 13.4% . Similar these international markets, the Toronto TSX composite was up, increasing 19.0% due largely to diversified metals, financials, and information technology sectors. The price of the Notes will not track the performance of a static portfolio invested since inception of the Notes according to the Portfolio's targeted allocation, and is affected by many inter-related factors including:
- the Portfolio "Dynamic Asset Allocation" feature,
- the performance of each of the funds in the Portfolio,
- changes in the level of interest rates,
- time remaining until the Notes' maturity date, and
- market demand for the Notes.
The difference between the performance of the Notes and the performance of a static portfolio invested according to the Portfolio's targeted allocation can largely be attributed to the Portfolio's "Dynamic Asset Allocation" feature. This feature is designed to both protect the Portfolio's net asset value (or "NAV") on the downside, and pursue potentially leverage returns on the upside.
Exposure to the funds is adjusted regularly and systematically according to a non-discretionary re-weighting procedure. Generally, as the value of the Portfolio increases, the Portfolio will potentially leverage its investments according to the targeted allocation up to a maximum of 150% of its NAV in order to pursue enhanced returns, and as the value of the Portfolio decreases, it potentially (i) de-leverages its investments in order to protect its NAV, and (ii) if the exposure is less than 100%, reallocates its investments from the four equity funds to a greater weighting in the CI Canadian Bond Fund. The Portfolio's performance to date has resulted in a current allocation to the Bonds of 100%, thereby giving it greater exposure to interest rate movements. However, the allocation process remains dynamic and reversible, and although the Portfolio will not directly track the performance of an investment in the underlying funds according to a static allocation during the term of the Notes, if the Portfolio is expected to provide solid, consistent performance throughout the term, then investors should benefit from the strong potential for leveraged returns at maturity.
Purchase
This Note has matured.
The Guarantor
BNP Paribas
BNP Paribas was established in 1848, and according to rankings published in July 2005 by The Bank, is the sixth largest banking group in the world and the largest in Europe based on total assets of approximately CAD $1.7 trillion (approximately the size of the Canada's five largest banks combined). As one of the world's leading diversified financial institutions BNP Paribas is present in over 85 countries, and has approximately 100,000 employees worldwide.
The BNP Paribas Group is organized around three core businesses: Retail Banking, Corporate & Investment Banking and Private Banking & Asset Management. Through its 2,200 branches across France and worldwide, BNP has more than twenty million individual and small business customers and 50,000 corporate customers.
BNP Paribas' long term debt ratings are: AA with a stable outlook from Standard & Poor's, Aa2 with a stable outlook from Moody's, and AA with a stable outlook from Fitch.
