Financial Leadership in Uncertain Times Restore Confidence, Regain Trust, Rebuild Wealth

Financial Leadershipin Uncertain Times

Restore Confidence, Regain Trust, Rebuild Wealth

Agenda for Today

• The Need for Leadership

• Financial Leadership Framework– Restore Confidence

– Regain Trust

– Rebuild Wealth

• The Road to Recovery

The Need for Leadership

• Reduction in wealth/loss of confidence

• Uncertainty around jobs/retirement angst

• Money Markets or mattresses

Financial Leadership

“…global recession is about to produce blood in the streets ‘civil wars’ and toppled governments.”

- Niall Ferguson

“We are in the worst financial crisis since the Great Depression.”

- President Barack Obama

“This is an economic Pearl Harbor.”

- Warren Buffett


Emotional Impacts


Equity Fund Investor vs. S&P 500

-50.00%

-40.00%

-30.00%

-20.00%

-10.00%

0.00%

10.00%

20.00%

1.87% 8.35%

20 Years1989 - 2008

- 41.63%- 37.72%

2008Equity fund investor

S&P 500


Lack of Leadership = Do It Yourself Investing

• Loss of confidence in traditional “brokers”

• 50 - 80% increase in number of discount brokerage accounts opened

• Lower fees make active trading more affordable – exactly what should NOT be happening


Motivation

A Framework for Leadership

Adopted from Ambrose 1987

SUCCESS+ Implementation

Expertise

Vision+

+

=


Successful Financial Leadership

RESTOREConfidence

REGAINTrust

REBUILDWealth

Motivation

Vision

Expertise

Implementation


Restoring Confidence

Restore Confidence

3 Areas to Focus On

• Our confidence

• Confidence of the public/investors in equities and investments

• Motivation of your clients to move forward with you towards a positive vision of the future

Restore Confidence

Advisor Confidence Index

Source: Rydex Advisor Benchmarking

Restore Confidence

33.33

66.67

100

133.33

166.67

February 2007emergence of the subprime issue123.88

Restore Confidence



100.25

33.33

66.67 133.33

166.67

September 2008US Fed began to cut federal funds rate

Restore Confidence



86.27

33.33

66.67

100

133.33

166.67

March 2008Dow Jones hit lowest point since October 2006

Restore Confidence



33.33

66.67

100

133.33

166.67

October 2008Emergency Economic Stabilization Act,creation of $700 billion Troubled Assets Relief Program

79.07

Restore Confidence



84.76

33.33

66.67

100

133.33

166.67

January 2009small increase, possibly due to election


33.33

66.67 133.33

166.67

Restore Confidence


93.59

April 2009highest level since Sept 2008

100


Restore Confidence


93.5997.06

86.27

100

86.9

100.25

115.24

112.5

123.88

106.07111.89

121.41

108.22

123.97124.48129.07

122.06

115.36111.12

84.76

79.0775

85

95

105

115

125

135

Jan-

04

Apr-0

4

Jul-0

4

Oct-04

Jan-

05

Apr-0

5

Jul-0

5

Oct-05

Jan-

06

Apr-0

6

Jul-0

6

Oct-06

Jan-

07

Apr-0

7

Jul-0

7

Oct-07

Jan-

08

Apr-0

8

Jul-0

8

Oct-08

Jan-

09

Apr-0

9

93.2

84.6

98.6

78.6

72.1

86.990.5

80.7

99.3 99.6

65.8

48.2

82.679.6

40

50

60

70

80

90

100

110

Jan-

04

Apr-0

4

Jul-0

4

Oct-04

Jan-

05

Apr-0

5

Jul-0

5

Oct-05

Jan-

06

Apr-0

6

Jul-0

6

Oct-06

Jan-

07

Apr-0

7

Jul-0

7

Oct-07

Jan-

08

Apr-0

8

Jul-0

8

Oct-08

Jan-

09

Apr-0

9

Investor Confidence

Restore Confidence

Source: State Street

Staying the course in challenging markets

Restore Confidence

Growth of the S&P 500 Composite $C,August 1979 to February 2009

Restore Confidence

% Gain Index

11.1% S&P 500 Composite Total Return Idx ($ Cdn)

10.0% MSCI World ($ Cdn)

9.7% S&P/TSX Total Return

30 Year Comparison of Major Indices

Restore Confidence

Index

S&P 500 Composite Total Return Idx ($ Cdn)

MSCI World ($ Cdn)

S&P/TSX Total Return

Restore Confidence

30 Year Comparison of Major Indices

Major Indices

Index S&P 500 Composite

Total Return Idx ($ Cdn)

MSCI World ($ Cdn)

S&P/TSX Total Return

Dec-01Dec-00 Dec-02 Dec-07Dec-06 Dec-08

Restore Confidence

U.S. equities – rolling 10-year compound total returns (1895-current)

Restore Confidence

Past ten years – worst since 30’s

Source: UBS, Tetrem Capital Management

Restore Confidence

Source: Factset

Investor Pessimism is Contrary to Market Performance

14.61% annualized

return on the S&P 500 over the next three

years

13.95% annualized


years

-16.67% annualized


years

0.36% annualized


years

???

Advisor Confidence

• New solutions – TFSA, GMWB

• Fewer competitive firms

• You do more than equities

Restore Confidence


RESTOREConfidence

REGAINTrust

REBUILDWealth

Motivation

Vision

Expertise

Implementation


Source: TrustedAdvisor Associates 2008

Broken Trust

Regain Trust

Regain Trust

Reasons for Failed Sales

Source: Heiman Miller, Conceptual Selling

0 10 20 30 40 50 60

Other

No budget

No urgency

No desire to change

No need

No Trust

Regain Trust

The Territory of a Trusted Advisor

Source: The Trusted Advisor, by David H. Maister, Charles H. Green, Robert M. Galford

EarningTrust

BuildingRelationships

Giving AdviceEffectively

Regain Trust

The Trust Equation

Trust = C + R + I S

Trust = Credibility + Reliability + Intimacy Self-Orientation


Regain Trust

Trust Realms

Credibility

Reliability

Intimacy

Self-orientation

Realm Example

Words

Actions

Emotions

Motives

I can trust what he says about…

I can trust her to…

I feel comfortable discussing this…

I can trust that he cares about…

Component

Source: The Trusted Advisor, by David H. Maister, Charles H. Green, Robert M. Galford

Regain Trust

C R IS

Trust =(worthiness)


Regain Trust

Ideas to Increase Credibility

C R I

STrust =(worthiness)


Regain Trust

Ideas to Increase Reliability

C RTrust =(worthiness) S

I


Regain Trust

Ideas to Increase Intimacy

C ITrust =(worthiness) S

R


Regain Trust

Ideas to Decrease Self-Orientation

C

STrust =(worthiness)

R I


Regain Trust

"No one cares how much you know,until they know how much you care"

Regain Trust

www.ci.com/PD

BRAND Overview Presentation

Regain Trust

www.ci.com/PD


RESTOREConfidence

REGAINTrust

REBUILDWealth

Motivation

Vision

Expertise

Implementation


Rebuild Wealth

http://img0.timelines.com/photos/images/00114e6b6444431881c836117a85285a_six_column.jpg

Process not an Event

Rebuild Wealth

Emotional Maturity

Rebuild Wealth

Do you have a wealth rebuilding strategy?

Rebuild Wealth

Rebuild Wealth

Wealth Rebuilding Strategy

Step four: Provide written recommendations and alternative solutions

Step one: Clarify the client’s present situation

Step six: Provide periodic review and revision

Step two: Identify both financial and personal goals and objectives

Step three: Identify financial problems

Step five: Implement the right strategy

Worry-free Wealth

Management

Motivation

A Framework for Leadership

Adopted from Ambrose 1987

SUCCESS+ Implementation

Expertise

Vision+

+

=


RESTOREConfidence

REGAINTrust

REBUILDWealth

Motivation

Vision

Expertise

Implementation



Thank you

All charts and illustrations in this guide are for illustrative purposes only. They are not intended to predict or project investment results. ®CI Investments and the CI Investments design are registered trademarks of CI Investments Inc.

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Financial Leadership in Uncertain Times Restore Confidence, Regain Trust, Rebuild Wealth