Investment Challenge

April 6th , 2010

Investment Challenge

Brant RumpelJohn BrodskyMike Rennie

• Account Value (CAD) 108,916.24*

• Overall Return +8.91%*

• 5th place in “the game”

*Investopedia

How did we do this?

No, we had a plan.

CanadaInvest in what

does best.What does

do best?

Natural Resources

Banking

Canada rated world’s soundest bank system: Survey

U.S. And U.K. Sink in World Economic Forum rating

Rob Taylor, ReutersPublished: Thursday, October 09, 2008

Natural ResourcesWorld class deposits of:

• Potash• Uranium• Crude Oil• Natural Gas

Long termBuy and hold

Total Transactions: 13

What methodsdid we use?

• Qualitative

• Quantitative

How did we pick ourstocks?

Our Strategies• Buy and hold• Diversification• Safe investments

• Well run companies

• Good track record

• Long term need

Qualitative

Choosing Stocks

• Speculation

• Sharpe Ratio

• C.A.P.M

• Historical Trend

Quantitative

Choosing Stocks

Choosing Energy StocksCompare Sharpe Ratios of:

• Canadian Natural Resources (CNQ.TO)• Encanna Corporation (ECA.TO)• Suncor Energy (SU.TO)• Cameco Corporation (CCO.TO)

Short Sale & Margin BuyMarginUse C.A.P.M to compare:

• Saputo• ?• ?

ShortUse C.A.P.M to compare:

• Telus• ?• ?

How did we execute this plan?

Execution

18%

9%

13%

40%

20%

Sector Diversification (by value)

Industrials

Financial

Consumer Staples

Energy

Telecommunications

Our Portfolio• TD Bank• Potash Corp• Canadian Natural Resources• Bridgewater Systems• Research in Motion• Encana• Canadian National Railway• Trans Canada Pipelines• Canada Bread• Cameco• Saputo (margin)• Telus (short)

9%

9%

13%

9%

6%9%

9%

9%

5%

9%

8% 5%

Overall Contribution to Portfolio (by value)

TD Bank

Potash Corp.

Canadian Natural Resources

Bridgewater Systems

Research in Motion

Transcanada Pipeline

Encana Corp.

Cadian National Railway

Canada Bread Co. Ltd.

Cameco Corp.

Saputo

Telus Corp.

-5.00%

0.00%

5.00%

10.00%

15.00%

20.00%

25.00%

30.00%

35.00%

13.36%

15.89%

6.29%

30.46%

8.46%

6.76%

3.11%

8.92%

-4.04%

4.41%

-2.73% -0.14%

Percent Change

What were our topperformers?

Best Performers

Bridgewater Systems

Percent Change

+30.46%

Best Performers

Potash Corporation

Percent Change

+15.89%

Best Performers

Toronto Dominion Bank

Percent Change

+13.36%

Worst Performer

Canada Bread

Percent Change

- 4.04%

How did wecompareto the market?

-2.00%

0.00%

2.00%

4.00%

6.00%

8.00%

10.00%

1 6 11 16 21 26

Perc

en

tage

Ret

urn

Our Portfolio vs. TSX vs. Risk Free Investment

Risk Free Rate

TSX Market

Our Portfolio

Period (days)

Conclusion

• Outperformed the market (by .53%)• Qualitative measures are important • Canadian strengths

Thanksfor listening