First Quarter Review North American Capital Appreciation Strategy March 2015

Macro events continued to dominate markets during the first quarter. The European Central Bank (ECB)’s decision to implement Quantitative Easing (QE) in January, put downward pressure on the Euro and the collapse in oil continued to hurt the Canadian dollar. While this was positive for the US dollar, it was not positive for US companies that generate earnings abroad, which currently make up about one third of the S&P500 revenues. Adding up the effects of a stronger US dollar and the impact it had on earnings revisions as well as the negative impact from lower energy prices, this managed to keep returns in North America at least in local currencies relatively flat. During the first quarter, the TSX returned 2.58% while the S&P500 returned 0.95% in US dollars.