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Mike Gassewitz, Executive Vice President, Member Solutions
MD Financial Management Inc.

Mike: Hi I’m Mike Gassewitz, head of Member Solutions here at MD. Joining me today is James Virgo, one of our experts focused on our Private Investment Counsel service, or as we like to call it, PIC. James, why don’t you tell us a bit about Private Investment Counsel here at MD.

James Virgo, National Lead, MD Private Investment Counsel

James: Sure, thanks Mike. So Private Investment Counsel is MD’s discretionary investment management arm. So discretionary investment management really, it’s a customized and structured approach to asset management, where the clients delegate the day to day responsibilities of managing their portfolio to an investment professional, or in this case, a portfolio manager.

Mike: So how does that differ from some of our other investment management services?

James: In the traditional advisor client relationship, an advisor will make recommendations to the client in terms of how the portfolio should be managed. The client ultimately is responsible in terms of implementing those recommendations. In the discretionary relationship we’re able to act on behalf of our clients and manage the portfolio on a day to day basis.

MD manages over $16 billion in assets on behalf of its Private Investment Counsel clients.*

Mike: So any of the movements of the assets between the various pools, again, that would be handled by the portfolio manager.

James: Yes that’s correct. They would make those changes within the confines of the investment strategy but they have the ability to do that.

Mike: So I’ve heard the term ‘fiduciary duty’ associated with Private Investment Counsel. Talk to us about first of all, what is that? And then secondly, why would that be important to a client.

James: So in terms of a discretionary relationship, obviously trust is of the utmost importance. So when we’re managing assets on behalf of clients we owe them the highest standard of care. So as a fiduciary, we have a responsibility to manage the assets as if they were our own or manage them in a manner we would as if they were our own assets.

Mike: Obviously several large banks have Private Investment Counsel services as well, how is MD’s different than those players?

James: I would say, if I had to sum it up in one word, I would say independence. Because we are non-bank owned and the largest independent counseling firm, we have the ability to go out and find the best investment managers to manage assets on behalf of our clients. So we have no ties or allegiance to any internal investment managers and really, ultimately, we are able to provide our best thinking on behalf of our clients, and I think that’s in their best interest.

Mike: Alternative asset class or alternative asset pools, I know we recently added those to the portfolio mix. Talk about those, why are those important?

James: They’re very important for our clients. Alternative investments are assets that have a different risk return profile or characteristics than traditional assets such as stocks or bonds, its assets such as commodities, real estate, infrastructure and we include them in our client’s portfolio in an effort to improve portfolio efficiency. So in plain English, we’re trying to reduce the risk for our clients through diversification while still offering the potential for a higher rate of return.

Mike: Apertura. I’ve heard PIC and Apertura come together. Talk to me, what is Apertura, and again why would that be good for a client?

James: So Apertura is not a product, it’s a service delivery channel. So in an effort to improve choice and convenience for our clients we’ve created a secure web-based portal that allows our clients to meet with their advisor virtually, at a location of their choice. So they still have the ability to come into one of the MD offices to meet with the advisor but if they prefer to meet from their home, their office, the cottage perhaps, they have that ability through our secure web-based portal.

Mike: That’s terrific, love it. James, thanks very much, it’s great to hear about the sophisticated offering like Private Investment Counsel that we’re delivering for our physicians.

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Inside MD – MD Private Investment Counsel
Mike Gassewitz, Executive Vice President, Member Solutions, MD Financial Management Inc.

*As of May 2014.

© 2014 MD Financial Management Inc.

MD Private Investment Counsel offers investment counselling services delivered by MD Financial Management Inc., a CMA company.

The MD family of mutual funds is managed by MD Financial Management Inc.

Commissions, trailing commissions, management fees and expenses all may be associated with mutual fund investments. Please read the prospectus before investing. Mutual funds are not guaranteed, their values change frequently and past performance may not be repeated. To obtain a copy of the prospectus, please call your MD advisor or the MD Trade Centre at 1 800 267-2332.