Investment Solutions

Manager Selection

Provisus Wealth Management is proud of our ability to deliver reputable investment managers to its clients.

Our Selection Process

We have developed an extensive program for gauging the strengths and weakness of individual managers. After determining the investment objectives for including a new strategy, we then conduct a background review for potential candidates. The selection process and subsequent monitoring procedures for third party managers are quite detailed but can be broken down into two broad categories which in turn have a number of subheadings as follows:

Performance Sustainability Criteria

Investment Process
Performance Track Record
Transparency & Liquidity

Company Stability & Reliability Criteria

Company
Infrastructure
Fees

Third Party Managers

World Class Portfolio Managers

What They Provide Us

Provisus Pooled Funds

With the help of our experienced professionals, Provisus Wealth Management's investment approach is one that rewards clients by choosing winning securities and avoiding stocks that will decrease performance.

Provisus Pooled Overview

Wealth managers today need to offer a robust set of solutions to satisfy each client and the broad needs of their entire household.

The Provisus Pooled Funds were developed to round out the range of options available as smaller accounts require investment vehicles to fulfill the long term investment objectives.

Proprietary Strategy

Our proprietary strategy for the Funds is to select those stocks which are expected to perform better than the market as a whole and provide clients with lower fees and tax advantaged returns.

Successful investment management involves a dedicated focus while working intelligently and diligently to ensure that we deliver an investment solution that meets your goals. Investors have a desire to go back-to-basics and embrace investment strategies that are high quality, straightforward, and easily understood. With the help of our experienced professionals, Provisus Wealth Management’s investment approach is one that rewards clients by choosing winning securities and avoiding stocks that will decrease performance.

Core Focus

The core funds hold 65 to 75 equity positions diversified across all economic sectors and incorporates a momentum based strategy to identify positions with the best risk / reward characteristics.

The funds have a low fixed annual management fee and earn a performance bonus for outperforming the benchmark. The fee for performance structure directly aligns our profitability to the results we achieve for our clients

Core Funds

Canadian Equity

U.S. Equity

International Equity

High Yield Fixed Income

Fund of Funds

North American Equity

Global Equity

Total Equity

Balanced

Investment Process

Provisus Wealth Management’s investment philosophy is based on the belief that markets are often inefficient, creating pricing anomalies that can be exploited by a disciplined, objective investment process.

Provisus employs a proprietary quantitative overlay process which matches the risk and weighting characteristics of the benchmark index while seeking to add incremental value by selecting stocks that could outperform.

Risk Characteristics

Each fund is designed to match the risk characteristics of the index by performing the following steps:

1
Buying identical percentage weights of stocks within each of the 10 principal sectors of the underlying indices.
2
Purchasing stocks such that their average Beta (it measures the extent to which the return of the fund moves with the market’s return) of the entire fund and each individual sectors equals the Beta of the index.
3
Purchasing stocks such that their capitalization levels, dividend and style classification (stocks are differentiated between fast growing companies and slower growing or value companies) match the underlying index.
4
And using proprietary volatility gauges which attempts to match and offset the risk inherent in the market to duplicate the index’s characteristics.

Quantitative Analysis

The second component of the process utilizes quantitative, technical and fundamental analysis to identify the relative momentum for each security being considered for investment.

This process determines the optimum point to buy and sell stocks. We rate each stock individually, versus the market and versus its sector to determine the best and worst stocks in the index. Our investment strategy generates trade signals based upon gauges and algorithms that have been calibrated to identify price turning points or changes in the direction of a stock’s price on an absolute and relative basis in order to assess the most promising stocks.

 

Optimization Process

The portfolio optimization process determines the most attractive securities to buy for the fund. Less attractive securities are removed from the fund while more attractive securities are added.

All such decisions are ultimately made by the portfolio managers. Our investment process is highly sustainable and has been proven in every market environment. Our investment philosophy is designed to produce a higher risk adjusted return while minimizing the volatility prevalent in today’s global markets.

 

Managed ETF Portfolio

Provisus combines the customization and tax control of managed accounts with low cost exchange traded funds to provide a comprehensive asset allocation solution.

Actively Managed ETF Portfolios

The potential investment universe of the Actively Managed ETF Portfolios are highly liquid index, sector, style, core and asset allocation Exchange Traded Funds (ETFs) which are actively managed on a risk adjusted return basis.

Provisus combines the customization and tax-control of separate accounts and low ETF costs to provide a comprehensive and competitive asset allocation solution.

Proprietary Quantitative Overlay

Provisus has developed a flexible asset allocation approach designed to enhance returns and reduce volatility.

Provisus employs a proprietary quantitative overlay process which matches the risk and weighting characteristics of the benchmark with fewer positions and utilizes an algorithm to select ETFs with the best characteristics in each category. Provisus then determines the optimal asset mix defined by risk, reward and diversification/composition requirements. The investment strategy is 50% quantitative, 30% technical and 20% fundamental.

Absolute Return

The investment objective of the Actively Managed ETF Portfolios is to deliver investment outperformance relative to the benchmark while maximizing downside protection.

One of Provisus’ primary goals for creating these portfolios is to provide smaller clients with absolute return investment vehicles to protect against market downturns like those that occurred in 2008. In recent times clients have seen volatility and correlation in traditional asset classes continue to rise. The absolute return objective is more than just a strategy as Provisus recognizes that the evolving nature of risk and return requires risk management solutions not commonly available to individual clients.

Actively Managed ETF Portfolios

The potential investment universe of the Actively Managed ETF Portfolios are highly liquid index, sector, style, core and asset allocation Exchange Traded Funds (ETFs) which are actively managed on a risk adjusted return basis.

Provisus combines the customization and tax-control of separate accounts and low ETF costs to provide a comprehensive and competitive asset allocation solution.

Proprietary Quantitative Overlay

Provisus has developed a flexible asset allocation approach designed to enhance returns and reduce volatility.

Provisus employs a proprietary quantitative overlay process which matches the risk and weighting characteristics of the benchmark with fewer positions and utilizes an algorithm to select ETFs with the best characteristics in each category. Provisus then determines the optimal asset mix defined by risk, reward and diversification/composition requirements. The investment strategy is 50% quantitative, 30% technical and 20% fundamental.

Absolute Return

The investment objective of the Actively Managed ETF Portfolios is to deliver investment outperformance relative to the benchmark while maximizing downside protection.

One of Provisus’ primary goals for creating these portfolios is to provide smaller clients with absolute return investment vehicles to protect against market downturns like those that occurred in 2008. In recent times clients have seen volatility and correlation in traditional asset classes continue to rise. The absolute return objective is more than just a strategy as Provisus recognizes that the evolving nature of risk and return requires risk management solutions not commonly available to individual clients.

The Provisus Managed ETF Portfolios currently offered are:

Bond ETF
Conservative
Balanced ETF
Balanced ETF
Growth
Balanced ETF

Managed REIT Portfolio

The Provisus Real Estate Income Trust (REIT) strategy is designed to provide clients with a good income stream by way of dividends and return of capital, while matching the characteristics of the S&P / TSX, REIT index.

REIT Distributions

A key feature for many investors is that REIT distributions are taxed quite differently than that of corporate dividends.

REITs are either closed or open ended publicly traded trusts that hold income producing real estate assets. A REIT is required to distribute at least all of its taxable income in order to avoid the trust itself being subject to income tax. REITs therefore receive favourable tax treatment on the income earned within the REIT as long as it is distributed to its unitholders. Distributions usually include a taxable income portion and a return of capital distribution, generally equal to the Capital Cost Allowance claimed by the REITs.

REIT Strategy

The REIT strategy holds 10 positions diversified across the Canadian REIT market and incorporates a momentum based strategy to identify positions with the best risk / reward characteristics.

The portfolio construction process begins by identifying key characteristics of the S&P / TSX, REIT benchmark and then identifying the degree to which these characteristics are represented in each underlying REIT. This process of matching the risk and weighting characteristics of the benchmark index with fewer positions is the indexation component of the strategy. The second component utilizes an algorithm to identify the relative momentum for each REIT. The final step is to combine the positions having the best relative momentum, all while replicating key characteristics of the benchmark.

The Provisus REIT strategy is suitable for long term investors seeking above average income potential and who understand the volatility of investing in income producing real estate assets.

REIT Distributions

A key feature for many investors is that REIT distributions are taxed quite differently than that of corporate dividends.

REITs are either closed or open ended publicly traded trusts that hold income producing real estate assets. A REIT is required to distribute at least all of its taxable income in order to avoid the trust itself being subject to income tax. REITs therefore receive favourable tax treatment on the income earned within the REIT as long as it is distributed to its unitholders. Distributions usually include a taxable income portion and a return of capital distribution, generally equal to the Capital Cost Allowance claimed by the REITs.

REIT Strategy

The REIT strategy holds 10 positions diversified across the Canadian REIT market and incorporates a momentum based strategy to identify positions with the best risk / reward characteristics.

The portfolio construction process begins by identifying key characteristics of the S&P / TSX, REIT benchmark and then identifying the degree to which these characteristics are represented in each underlying REIT. This process of matching the risk and weighting characteristics of the benchmark index with fewer positions is the indexation component of the strategy. The second component utilizes an algorithm to identify the relative momentum for each REIT. The final step is to combine the positions having the best relative momentum, all while replicating key characteristics of the benchmark.

The Provisus REIT strategy is suitable for long term investors seeking above average income potential and who understand the volatility of investing in income producing real estate assets.

Putting It All Together

Provisus Wealth Management specializes in providing concise, integrated solutions. We put it all together by following the following premises:

Smart Investing Made Easy

Investors are looking for active management because they want to achieve superior risk adjusted long term performance.

Wealth managers today need to offer a robust set of solutions so they can retain existing clients and win new ones. Provisus Wealth Management can deliver complete management solutions containing multiple investment vehicles that are simpler,less expensive and support dramatically higher levels of customization and tax management.

Winning By Not Losing Over Time

Our philosophy is simple but powerful: over time, our goal is to capture most of the market’s good times and miss most of its bad times.

Provisus believes that missing severe market drops is essential to investment success, because the less an investor loses during downturns the less they have to make up before they are net positive during a rebound. Making money is important, but protecting that money can be just as important.We believe that selecting skillful investment managers sets us apart from other investment offerings.

In It For The Long Haul

Provisus’ process is designed to provide a systematic, disciplined approach that emphasizes long term results and portfolio risk reduction to help clients achieve their financial goals without the degree of volatility often associated with other investment approaches.

While we cannot guarantee that the clients results will meet specific long term financial targets, our repeatable processes are designed to offer a smoother ride along the way.

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