Building your financial future Foyston, Gordon & Payne Canadian Equity Basket What is a Basket? It is an investment model that is managed by a professional portfolio manager on a discretionary basis in your brokerage account. You directly own its underlying securities and receive the dividends and/or interest paid. Investment Strategy The equity portfolio mostly consists of a value-oriented style of Canadian large capitalization stocks that provide a broad, diversified exposure to the Canadian economy and liquidity for the portfolio with a low turnover. Risk will be controlled through defined parameters for security weight and diversification amongst sectors. Security weights are also determined by investment grade, with a smaller weight on a lower grade (poorer stock). Your Investment Advisor may provide you with the complete Investment Policy Statement. Basket Performance as at September 30, 2014 1 month Basket Benchmark** -4.13% -3.99% 3 months -0.78% -0.59% YTD 10.45% 12.20% 1 year 19.30% 20.38% 2 years* 21.13% 13.56% 3 years* 17.22% 12.07% 5 years* 10.76% 8.67% Since inception* 10.26% 8.96% Annualized. ** S&P/TSX Composite * Returns presented in Canadian dollars before management fees Basket Value: $94,862 Dividend Yield (%): 2.94% Content The selection universe will mostly be among the securities in the S&P/TSX Composite Index. In general, the Basket may be totally invested in shares, however, cash or cash equivalents, convertible and exchangeable securities, warrants, treasury bills and commercial paper (minimum credit quality R-1 low) may be part of the Basket if a security is sold before a replacement has been chosen. The target portfolio weight (market value) of most securities will vary between 2% and 6%, with no holdings having a target weight of more than 8%. Sector Allocation (%) Financial Energy Consumer Discretionary Materials Telecom Misc. Consumer Staples Industrial 39.86% 25.92% 8.61% 7.22% 6.97% 4.96% 4.49% 1.96% Investment Horizon The investment horizon is medium term, therefore from 3 to 5 years. Other characteristics Inception Date: May 18, 2009 Initial minimum investment: $94,862* Subsequent investments: $47,431* Portfolio Manager: Foyston, Gordon & Payne inc. Benchmark: S&P/TSX Composite * Contingent on the market value of the Basket and accrued interests/dividends at the time of purchase. Benchmark Sector Allocation (%) Financials Energy Materials Industrials Consumer Discretionary Telecommunication Services Consumer Staples Health Care Utilities Information Technology 34.67% 26.14% 12.23% 8.06% 5.33% 4.44% 2.77% 2.67% 1.87% 1.82% For more information This Basket is suitable for investors who: • wish to add a long term growth component to their portfolio. • want exposure to the Canadian equity market. • are willing to tolerate a moderate level of risk. This summary may not contain all the information you need. Refer to the Discretionary Management Agreement for more detailed information. Should you require further information, please contact your National Bank Financial Investment Advisor. How risky is it? You can have access to this summarized fact sheet and the Disclosure Statement at http://nbfwm.ca/en/baskets. This investment is not guaranteed and its value can go down as well as up. National Bank Financial rates this investment’s risk as moderate. Low Low to Moderate Moderate Moderate to High A word about tax In general, you’ll have to pay income tax on any gain and revenue generated from your investment. How much you pay depends on the tax laws that are applicable in the area you live in and whether or not you hold the investment in a registered plan, such as a Registered Retirement Savings Plan or a Tax-Free Savings Account. Keep in mind that if you hold your investment in a non-registered account, fund distributions or capital gains are included in your taxable income; whether they are paid, accrued or reinvested. High How much does it cost? * Investment Fees* from $1 to $250,000 1.95% from $250,000.01 to $500,000 1.80% from $500,000.01 to $1,000,000 1.60% $1,000,000.01 or more 1.35% Where applicable, fee schedules attributed to fixed rate accounts supersede these fees. Payable within your brokerage account, management fees are charged monthly as a percentage of the Private Pool's market value. Your Investment Advisor may also charge you a trading fee of up to 2% of your investment. Basket Content as at September 30, 2014 Description Agrium Quantity Ticker Price Market value Weight Annual income Yield 26 AGU $99.56 $2,588.56 2.73% $87.09 3.36% Bank of Nova Scotia 98 BNS $69.27 $6,788.46 7.16% $258.72 3.81% Canadian Natural Resources 120 CNQ $43.51 $5,221.20 5.50% $108.00 2.07% Canadian Oil Sands 92 COS $20.66 $1,900.72 2.00% $128.80 6.78% Canadian Tire 36 CTC.A $114.75 $4,131.00 4.35% $72.00 1.74% 4708 1CAD $1.00 $4,708.00 4.96% $0.00 0.00% CIBC 68 CM $100.59 $6,840.12 7.21% $272.00 3.98% Ensign Energy Services 130 ESI $14.71 $1,912.30 2.02% $61.10 3.20% Husky Energy 72 HSE $30.74 $2,213.28 2.33% $86.40 3.90% Imperial Oil 102 IMO $52.91 $5,396.82 5.69% $53.04 0.98% Loblaw 76 L $56.05 $4,259.80 4.49% $74.48 1.75% Magna International 38 MG $106.30 $4,039.40 4.26% $62.90 1.56% Manulife Financial 156 MFC $21.54 $3,360.24 3.54% $96.72 2.88% Cash Potash Corporation of Saskatchewan 52 POT $38.78 $2,016.56 2.13% $81.26 4.03% Power Corporation of Canada 128 POW $31.08 $3,978.24 4.19% $148.48 3.73% Precision Drilling 168 PD $12.09 $2,031.12 2.14% $40.32 1.99% Rogers Communications 76 RCI.B $41.92 $3,185.92 3.36% $139.08 4.37% Royal Bank of Canada 90 RY $80.05 $7,204.50 7.59% $270.00 3.75% SNC Lavalin 36 SNC $51.57 $1,856.52 1.96% $34.56 1.86% Sun Life Financial 74 SLF $40.60 $3,004.40 3.17% $106.56 3.55% Suncor 146 SU $40.53 $5,917.38 6.24% $163.52 2.76% TD Bank 120 TD $55.27 $6,632.40 6.99% $225.60 3.40% Teck Resources 106 TCK.B $21.21 $2,248.26 2.37% $95.40 4.24% Thomson Reuters 84 TRI $40.80 $3,427.20 3.61% $121.36 3.54% $94,862.40 99.99% $2,787.40 2.94% Total The Baskets are offered in the context of the Discretionary Management Program offered by National Bank Financial Inc. and National Bank Financial Ltd. (collectively, “NBF”), subsidiaries of National Bank of Canada. Please read the terms of the Discretionary Management Agreement to be entered into between you and NBF before investing. An investment in a Basket is not guaranteed, its value changes frequently and past performance may not be repeated. This document may not be copied or distributed, either in whole or in part, without the prior written consent of NBF. Foyston, Gordon & Payne Canadian Equity Basket Who is this investment for?