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There is a growing appetite for income, especially with aging baby boomers preparing for retirement and entering a more conservative phase of their lives. A closer look at the Canadian retirement market reveals a number of interesting facts, including:
- Within the next 10 years, Canadians age 55+ will control over 70% of investment assets.
- Canadians are living longer lives.
- Close to one-half of Canadians age 50+ remain uncertain of the best options for their retirement nest-egg.
- And, nearly one-third of this same group are concerned about maintaining their current lifestyle in retirement.
Source: Investor Economics
With this, today’s investment challenge for many Canadian investors is finding a source of income that can provide an adequate yield, without taking on excessive risk.
Lower yields are not just a recent phenomenon.
For nearly a decade, investors who have been invested in fixed-income vehicles, such as GICs, have received negative returns after inflation and taxes (see chart 1). In 2008, the average 1-year GIC was yielding less than 2% – while inflation was running at 2.3%. On top of that, interest income is taxed at the full marginal rate.
Source: Bank of Canada, Statistics Canada. Based on the average 1-year GIC rate, a top marginal tax rate of 46.4% for Ontario in 2008 and the annual rate of inflation.
The bottom line is that for investors their after-tax income hasn’t kept pace with rising prices and that the purchasing power of their dollar has actually shrunk year after year.
CI has the investment solutions that can create potentially higher-yielding portfolios with better overall risk adjusted-returns.
Investors benefit from:
- enhanced yields
- diversification by security and by asset class
- active asset allocation
- the proven expertise of CI’s portfolio managers
- currency hedging.
CI’s income solutions can meet a variety of needs, including tax-efficient monthly cash flow, capital preservation, or income plus the potential for growth. They are also available in various platforms, including managed solutions, SunWise Elite Segregated Funds and the tax-efficient CI Corporate Class and T-Class.
Signature Diversified Yield Fund 
Provides income and some capital growth by investing in a diversified portfolio of high-yielding alternative asset classes, such as high-yield
bonds, infrastructure, real estate and REITs.
Benefits
- Management expertise of award-winning Signature Global Advisors, led by Chief Investment Officer
Eric Bushell.
- Enhanced yield compared to traditional income investments.
- Tax-efficient monthly distribution in the form of capital gains or return of capital.
- Exposure to a diversified portfolio of high-yielding asset classes, including securities not typically available to non-institutional investors.
- Active asset allocation in response to changing market conditions.
- Active currency hedging.
Suitable for investors seeking a high level of income through exposure to Canadian and global income-generating securities. |
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Signature Corporate Bond Fund
Provides investors with a higher level of income by investing primarily in investment-grade and high-yield corporate bonds.
Benefits
- Enhanced yield potential over traditional bond funds.
- Prudent mix of corporate bonds.
- Risk/return profile lies between a fixed-income fund and an equity fund.
Suitable for investors seeking a potentially higher level of income and a low correlation with other asset classes.
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Signature High Income Fund 
Provides a high level of income and long-term capital growth by investing in a diversified mix of equities, high-yield bonds, REITs and income trusts.
Benefits
- Highly diversified holdings.
- Offers tax-advantaged income compared with conventional bond funds.
Suitable for investors seeking a steady income, plus potential growth through exposure to equity investments.
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Signature Income & Growth Fund
Provides income by investing in a diversified portfolio of primarily Canadian common equities, income trusts, government bonds, preferred shares and investment-grade corporate and high-yield bonds.
Benefits
- Diversified by asset class and within each asset class for reduced risk.
- Various sources of income for tax-efficient returns.
Suitable for investors seeking a high level of steady income, plus potential growth through exposure to equity investments.
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Portfolio Series Income Fund
Provides a high level of income and preserves capital by investing in a diversified basket of Canadian and global bond and income funds.
Benefits
- Diversified among a large number of income sources, making it ideal for those seeking a reliable, sustainable income stream.
- Multi-manager, multi-style portfolio management.
- Widely diversified holdings provide low volatility.
Suitable for investors seeking income and capital preservation with a widely diversified portfolio in a single investment.
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Portfolio Select Series 100i
Reduces risk and preserves capital by investing in a diversified basket of government, investment-grade and high-yield bonds.
Benefits
- Diversified among a large number of income sources, making it ideal for those seeking a reliable, sustainable income stream.
- Widely diversified holdings provide low volatility.
Suitable for investors seeking a tax-efficient source of income and capital preservation with a widely diversified portfolio in a single investment.
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If you any questions please call CI Client Services at 1-800-563-5181, or contact your financial advisor.
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