EIM Partners Fund

WHAT CAN THE FUND DO FOR YOU?

Our experience in designing and managing portfolios for High Net Worth and affluent clients is echoed in a pooled fund product.
At Exponent Investment Management, we help clients move from active business or professional income to passive investment income more commonly referred to as retirement. In other words, we help clients live from their investments and other income sources. We call it Your State of Independence.

INCOME

The focus and need for income on the part of our clients directs our attention to companies that have a history, ability and policy of rewarding shareholders with dividend income. Thus, the EIM Partners Fund will predominantly be invested in dividend paying stocks.

GROWTH

Dividend income is important, but growth is equally important. We are looking for companies that grow their income and thus the value of their operations over time. As the profits grow, the dividend payments also tend to grow along with the share price.
fund page 2

WHY A POOLED FUND?

The pooled fund structure caters to the needs of some of our clients. We will apply the same investing principles we have used for over twenty years, but do so in a fund form.

The pooled fund is effectively a private mutual fund for the clients of Exponent Investment Management Inc. The pool is best suited for these situations:

Significant family holdings that include additional small accounts: Some clients have substantial investments to deploy but will include a few or several small accounts. Using a pooled fund for the smaller accounts allows for instant diversification in one investment.

Size of portfolio to invest: Having a pool allows us to extend our service offerings to children and other family members of our clients. While the client receives the benefits of direct stock ownership in dividend paying companies, the family member or child may not be as far along in terms of capital to invest. The pooled fund allows an investor a cost effective manner to invest in our portfolios without being excluded by minimum investments many of our competitors impose.

Systematic investments or withdrawals: A subset of clients will be depositing or withdrawing funds from one or some of their investment accounts every month. It could be an RRSP, RESP, TFSA or a RRIF. In all cases, the result is the same; a transaction must transpire – a sale in the case of a withdrawal, or a purchase in the case of a deposit. A pooled fund enables us to avoid the monthly “what stock are we selling/ buying this month to fund the transaction?” decision. By selling units in the fund, we are effectively selling or buying a bit of everything thereby keeping the balance of the portfolio as intended.

THE THREE PRINCIPLES OF THE EIM PARTNERS FUND

Transparency

We will show you a snapshot of the portfolio every month. On an annual basis, we will share audited financial reports as well as an annual report outlining the transactions that occurred in the fund.

Clarity

The strategy and approach of the fund is the same used by the portfolio manager throughout his career: dividend income and growth of both income and capital over time.

Safeguards

The fund is not able to invest in illiquid and unlisted private companies or structures. Only listed stocks and securities are permitted. The fund cannot borrow to invest. The fund is governed by an outside fund manager, trustee, and auditor. The structure by its very nature is the safeguard of the fund.

ROLES IN THE MANAGEMENT OF EIM PARTNERS FUND

t9

Benoit Poliquin

President & Portfolio Manager

Portfolio Manager: Benoît Poliquin is the portfolio manager of the fund.

Along with members of his team, he will direct and execute the investment decisions for the fund.

Investment Fund Manager: Majestic Fund Solutions is the manager that takes care of the day-to-day administrative tasks that come with a pooled fund. The hiring of a third party for this role allows the portfolio manager to focus on what a portfolio manager should be doing: investment decisions. The hiring of an outside Investment Fund Manager allows for counsel and significant cost savings that would otherwise be difficult to obtain.

Custodian: The individual investments made by the unit holders are pooled and held with the custodian of the fund. The Custodian is Aviso Wealth. The role of the custodian is to hold the securities that make up the fund and facilitate the trading of these securities.

Record Keeping: Keeping track of the unit holders, the value of the units in the fund, the tax reporting and year end audits services are provided by SGGG Fund Services Inc.

Download the portfolio Statement

FEES

The safeguard provided by the structure of the EIM Partners Fund does cost money. The cost of this structure is expected to be 0.6% on an annualized basis for the E series fund which is the series reserved for Exponent Investment Management clients. This cost is borne by the fund itself. As the fund grows, many of the administrative costs will diminish and the goal is to continue to make the EIM Partners Fund cost competitive.

The cost of purchasing units in the fund is free for clients of Exponent Investment Management Inc.
The portfolio manager will be receiving a performance fee if the value of the fund units experience a return of 6% on annualized basis. There is no performance fee payable if the unit price of the fund is below previous values. This is known as a high watermark. What it means for unit holders is that the portfolio manager is incentivized to grow the unit value but not at the expense of unnecessary risk. The performance fee is 10% of the return between 6% and 12% and 15% of the return above 12%.

FAQ

We will never be as competitive as funds that have hundreds of billions of dollars under management as operating costs are directly linked to assets under management. We are offering a one decision portfolio at a competitive price. The fund is an extension of the investment management and financial planning service offering of the firm for clients who wish to delegate the day-to-day management of their portfolio. You will retain transparency, clarity, and safeguards with the added benefit of choosing an experienced advisor. No robots, call centers or recent graduates will come anywhere near your affairs. We WANT you to call or email us. Serving clients is what we do and your financial independence is what we strive for.

We are stock nerds. We understand why someone would rather own stocks directly. In most cases, a portfolio of stocks is more advantageous. However sometimes, a pooled fund will be more cost effective as it can provide the liquidity and diversification required in one transaction. We agree it is not for everyone all the time.

Disclaimer

In managing your account consistently with your investment policy, Exponent may invest in securities of pooled investment vehicles such as, but not limited to, mutual funds, pooled funds (open-end or closed-end), special purpose vehicles, limited partnerships or investment trusts (a “Fund”), whether or not they are managed or advised by Exponent. When Exponent invests, on your behalf, in securities of a Fund, there may be fees and expenses payable by the Fund in addition to the fees and expenses payable to Exponent under your investment management agreement. Where Exponent invests in securities of a fund on your behalf, Exponent will ensure that the Fund does not pay management fees or incentive fees that, to a reasonable person, would duplicate a fee payable by you to Exponent for the same service.