Table of Content
1. Wealth Management
2. Accounts
3.The Funds
4. Fees and Purchase Information
5. Registered Plans
6. Dealer Resources
7. Taxes and Distributions
8. Corporate Governance and Responsible Investing
9. Unclaimed Property Policy
10. Other
1. Wealth Management
1.1 What is wealth management and how does it differ from investment management?
Investment management is a subset of wealth management. It consists of the decision-making processes related to a specific mandate, such as domestic equities or international fixed income. Wealth management is more all-inclusive and customized to your needs. Wealth management services, such as the ones offered by Pembroke’s experts, may include asset allocation, financial planning, and tax and estate services. The wealth manager also acts as the hub for the different parts of your financial life.
1.2 How do you help clients manage their wealth?
Wealth management is the delivery of financial services as well as other services to help you devise and execute long-term financial and personal goals tailored to you and your family. Pembroke takes an individualized approach in assessing the individual or family balance sheet to allow its experts to make appropriate investment, tax, risk and financial recommendations.
Pembroke goes a step further by utilizing a unique behavioural investment assessment tool. The Intelligo Financial Behavioral Personality assessment helps you better understand how you view risk and uncover how key psychological factors can influence your financial decision-making process. Combined with identified monetary goals, it provides a clearer path to financial achievement.
1.3 How can you help me understand my risk profile?
The first step is to understand how you define the concept of risk. Once defined, Pembroke will help you assess your tolerance and capacity for risk by reviewing your comfort level, your financial situation and your time horizon (often a function of your age, your portfolio value, your specific objectives for wealth accumulation as well as your concerns for charitable giving and family descendants).
Generally, a portfolio of sufficient size with a long-term time horizon can withstand greater risk than one with a shorter timeframe that eschews risk in favour of capital preservation. Nothing is a given as it depends on each client’s investment knowledge and their preference for risk.
1.4 Does Pembroke offer financial planning services?
Pembroke offers a full suite of financial planning services that includes retirement, tax and estate planning.
1.5 What are the benefits of a financial plan?
Many people aspire to be debt– free homeowners with the resources to face unplanned financial emergencies. In addition, they want a well planned retirement, to be able to support their family and to manage their finances.
Those more established are also interested in tax planning, multi-generational estate planning, charitable giving, the creation of a foundation and the simplification of their financial affairs.
A personalised plan aims to provide you with financial peace of mind, by simplifying your personal situation and building a comprehensive roadmap towards specific milestones.
1.6 What are the benefits of donating securities to a charity rather than cash?
Donating securities that have a large unrealized capital gain to a registered charity is typically more tax efficient than selling the securities to make a cash donation. The gain triggered on a donation to a registered charity of publicly listed securities, including mutual fund units or shares, is generally exempt from capital gains tax.
1.7 What are the benefits of active management?
Active management involves the selection of securities with the expectation of generating superior performance over an appropriate index. Passive management involves investing in such a way as to mimic the performance of a particular index (e.g. the S&P 500). Successful active management compounds your wealth at a higher rate of return.
Active managers are often more successful when investing in less efficient markets. Active managers may control risk by limiting exposure to undesirable characteristics, such as loss-making companies, flawed business models or extreme valuations.
1.8 What is asset allocation?
Asset allocation aims to balance risk and reward by apportioning asset classes according to your investment goals, risk profile and time horizon.
There are five main asset classes: equities, fixed income, cash and cash equivalents, real estate and alternative assets. For many investors, real estate (home ownership) represents a substantial portion of their investment portfolio, thus creating a need for balance through equity participation. Each asset class has different levels of expected risk and return. Asset classes are also likely to behave differently over time.
There is no simple formula for determining the most appropriate asset allocation without a thorough understanding of each investor’s financial requirements.
1.9 What is portfolio rebalancing?
Portfolio rebalancing is the process of returning the asset allocation of your current portfolio to the target levels that you have previously identified in your Investment Profile Summary (IPS).
Portfolio rebalancing typically results in selling the outperforming asset class and purchasing the underperforming asset class. At a certain point, an outperforming asset class will “regress” to its mean (average) return. This can happen either through a period of lacklustre returns or significant loss. Rebalancing takes the investor’s profits out of the high-valued asset class before that loss.
Rebalancing can have negative penalties in taxable accounts. However, these consequences can often be mitigated by your wealth advisor. While there is no required schedule to rebalance a portfolio, it is recommended that a portfolio review with your account representative take place at least once a year.
2. Accounts
2.1 What documentation is needed to open an account?
Your Pembroke representative will fill a new account application document and a Know Your Client (KYC) form. These documents provide preliminary information for Pembroke’s proper structuring of your account, as well as information for tax authorities. The information helps determine your financial needs and meet regulatory obligations.
The requirements for a non-registered individual or joint account are:
- acceptable identification for each account holder (please refer to question #2 below for the list of acceptable identification pieces),
- your social insurance number,
- a void cheque in the name of the account holder (a joint bank account is required when there is more than one investment account holder).
The requirements for a registered account (e.g. Tax-Free Savings Account (TFSA), Registered Retirement Savings Plan (RRSP), etc.) are:
- a void cheque,
- your social insurance number.
The requirements for a corporate account are:
- a certificate of incorporation or any other valid and current record that contains the corporation’s name, address and the names of its directors,
- a void cheque in the name of the corporation,
- acceptable identification for each authorised signing officer.
The requirements for a trust account are:
- a Trust Agreement,
- a void cheque in the name of the Trust,
- acceptable identification for each Trustee.
The requirements for an estate account are:
- an original death certificate or (Act of Death for Quebec residents),
- a notarised copy of the Will,
- acceptable identification for each executor (or liquidator for Quebec residents).
2.2 What are acceptable pieces of identification?
When meeting in person, Pembroke requires two pieces of government-issued identification. If you are unable to meet in person, one piece of government-issued identification and a current utility bill or banking statement showing your name and address are required.
The following list provides examples of acceptable government-issued photo identification documents from federal or provincial authorities:
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- Canadian passport,
- Permanent resident card,
- Citizenship card (issued prior to 2012),
- Secure Certificate of Indian Status,
- Driver’s Licence,
- Provincial identity cards,
- Provincial health card from permitted provinces.
- Ontario, Manitoba, Prince Edward Island, Nova Scotia and New Brunswick health cards may not be used for identification purposes.
- Global Entry card
- NEXUS card
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2.3 How can I access my account on-line?
After your Pembroke account has been opened and the Internet Access form has been signed, your account representative may grant you access to your accounts on Pembroke’s client portal.
You will then receive an email with a link that will allow you to create your password. Please reach out to your Pembroke representative if you require assistance with portal access.
2.4 How do I transfer cash to my Pembroke account?
There are four ways to transfer cash into your Pembroke account.
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- If your banking information is on file, you may authorise Pembroke to withdraw cash by providing verbal instructions if you have signed a Verbal Authorisation Form, otherwise we would require a signed letter of direction.
- You may have your bank send a wire transfer.
- You may write a cheque payable to Pembroke Private Wealth Management Ltd.
- If you would like to transfer your investments to Pembroke from another financial institution, you may sign a registered or non-registered transfer form provided by Pembroke. This transfer method is particularly important when moving a registered account, as it ensures that there are no adverse tax implications. Pembroke does not accept in-kind transfers of third-party mutual funds. Your third-party mutual funds would have to be sold by the relinquishing institution and transferred to Pembroke in cash. Please contact your Pembroke representative for more information.
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2.5 How old do you have to be to open an account?
To open an investment account, you must be the age of majority in the province or territory in which you reside.
Age of majority by province:
- 18 years: Alberta, Manitoba, Ontario, Prince Edward Island, Quebec and Saskatchewan
- 19 years: British Columbia, New Brunswick, Newfoundland and Labrador, Northwest Territories, Nova Scotia, Nunavut and Yukon
If you would like to make an investment for a minor, you may open an “In Trust” account. Please contact your Pembroke registered representative.
3. The Funds
3.1 What is a mutual fund?
A mutual fund allows you to invest in a collection of securities that are defined in a simplified prospectus and selected by professional portfolio managers. The simplified prospectus is a legal document, filed with the Canadian Securities Administrators (CSA), which gives investors important information about the fund.
Mutual funds are required to file certain documents with the CSA, which operates the System for Electronic Document Analysis and Retrieval + (SEDAR+). SEDAR+ is an electronic filing system used by publicly traded companies, mutual funds and other securities issuers to disclose financial and other information to the public.
3.2 What is a pooled fund?
A pooled fund operates similarly to a mutual fund, allowing investment in a collection of securities selected by professional portfolio managers. However, under securities regulations, a pooled fund is not required to have a prospectus. A pooled fund is only offered on a private placement basis and, as such, may only be purchased by investors who are “accredited investors” or “related investors”, within the meaning of applicable securities regulations.
Pooled Funds are issued through a Term Sheet. A term sheet is a legal document that outlines the terms and conditions of the pooled fund. In general, pooled funds incur less expenses than mutual funds do, which is beneficial to the investor.
3.3 What are the benefits of investing in a fund rather than in individual securities?
Investing in mutual or pooled funds can provide you with cost-effective exposure to a diversified portfolio of professionally managed securities. The manager seeks the appropriate balance between risk and return and will actively purchase and sell securities within the fund. Dividends and interest income generated within a fund can be automatically reinvested by the fund.
3.4 What is an accredited investor?
An accredited investor is an individual, entity or financial institution that meets specific criteria. You need to be an accredited investor to invest in a pooled fund, but not to invest in a mutual fund.
As a private individual investor, you may qualify as an accredited investor in Canada if you meet at least ONE of the criteria below.
Income
- Your net income before taxes exceeded $200,000 in both of the last two years, and you expect to maintain at least the same level of income this year; or
- Your net income before taxes, combined with that of a spouse, exceeded $300,000 in both of the last two years, and you expect to maintain at least the same level of income this year.
Financial Assets
- You alone or together with a spouse own financial assets worth more than $1 million before taxes, but net of related liabilities.
Net Assets
- You alone or together with a spouse have net assets of at least $5,000,000.
3.5 Do you have an F-Series, and what is the difference between an A-Series and an F-Series?
The Pembroke Concentrated Fund is available as an F-series. F-series funds are available to investment advisors and financial planners who charge their clients on an assets-under-management basis (fee-based account), rather than on an individual transaction basis.
It is important to note that Pembroke funds are “no-load” funds and do not pay trailer commissions. One hundred percent of the management fees are paid to Pembroke for investment management services.
3.6 When are the funds priced?
The Pembroke family of mutual and pooled funds are priced every Tuesday and at every month end. Should a valuation day fall on a holiday, the funds are priced the following business day. If a valuation day falls on a weekend, the funds are priced on the preceding Friday.
Certain speciality funds offered by Pembroke are priced only at the month end.
3.7 Where can I find the fund prices and performance-related information ? They can be found here
3.8 Do you have funds that trade in US dollars?
Pembroke has three funds that trade in US dollars:
- Pembroke American Growth Fund Inc.
- Pembroke Concentrated Fund
- Pembroke US Growth Pooled Fund
These three funds also trade in Canadian dollars and the underlying securities of the Canadian and US dollar versions of a given strategy are identical.
These funds allow you to place transactions, receive distributions and hold your investments in US dollars. Subscriptions and redemptions in US dollar funds are settled in US dollars.
Should you want to transfer your funds from a US dollar fund to a Canadian dollar fund, you must first sell your investment, convert the proceeds to Canadian dollars and make a new investment in the other fund in Canadian dollars. Pembroke cannot provide currency conversions.
3.9 Who are the sub-advisors to the funds?
Pembroke Private Wealth Management (PPW) makes use of sub-advisors to select the securities held in each of the pooled and mutual funds it manages. Most of the funds offered by PPW are sub-advised by Pembroke Management (PML), the parent company of PPW.
PPW also makes use of third-party sub-advisors. These firms share our focus on active management, our philosophy and our security selection approach. William Blair, based in Chicago, is the sub-advisor for the international growth strategy, and Canso Investment Counsel, based in Toronto, is the sub-advisor for our fixed income strategies.
3.10 What are the regulatory documents associated with each fund?
Mutual funds and pooled funds are required by securities law to file reports and other documents on the System for Electronic Document Analysis and Retrieval+ (SEDAR+).
Mutual funds:
- Fund Facts: a document that highlights key information about a mutual fund, including holdings, performance, risk, and the costs of buying and owning the fund. Fund Facts are updated annually in the first calendar quarter.
- Simplified Prospectus: the simplified prospectus contains information about Pembroke’s mutual funds, including the entities and individuals responsible for their administration, valuation, purchases, switches and redemptions, fees and expenses, income tax considerations, the investment objectives, strategies and risks. The simplified prospectus is renewed annually in the second calendar quarter.
- Management Reports of Fund Performance (MRFPs): An MRFP is prepared for each of Pembroke’s mutual funds and includes commentary on the mutual fund’s operations and recent developments, along with financial highlights, performance, and summary portfolio information. MRFPs are prepared twice a year, for the periods ending June 30 (unaudited interim) and December 31 (annual audited).
- Financial Statements: financial statements provide a summary of a fund’s financial position and a complete list of the securities held in the portfolio. The financial statements are prepared twice a year, for the periods ending June 30 (unaudited interim) and December 31 (annual audited).
Pooled funds:
- Pooled Fund Term Sheet: A term sheet is a legal document that outlines the terms and conditions of the pooled fund. The term sheet includes information about the fund’s investment objective, who can invest in the fund, the minimum purchase requirements, valuation, redemption, as well as fees and expenses. The term sheet is not an offering document and provides only an overview of the fund.
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- Financial Statements: financial statements provide a summary of a fund’s financial position and a complete list of the securities held in the portfolio. The financial statements are prepared twice a year, for the periods ending June 30 (unaudited interim) and December 31 (annual audited).
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3.11 What are the benchmarks for the strategies offered?
Some investors establish the absolute returns they expect to achieve over time, while others use established benchmarks to measure the relative return of a fund against a passive index.
Pembroke uses the following benchmarks for each of the strategies offered.
| Asset Class | Benchmark |
| Canadian Equities | S&P/TSX Composite Index and S&P/TSX Completion Index |
| US Equities | S&P 500 Index and Russell 2000 Index |
| International Equities | MSCI EAFE Index and MSCI ACWI ex-US Small Cap Index |
| Government Bonds | FTSE TMX Canada Universe Bond Index |
| Corporate Bonds | FTSE TMX Canada All Corporate Bond Index |
| Cash | Canadian Treasury Bill |
3.12 Do the funds make use of Exchange Traded Funds (ETFs)?
Pembroke managed strategies have produced above market returns over time. This is attributable to a collection of factors, such as our culture of alignment with clients, our time-tested investment philosophy, our specialized investment management expertise, our stable team, and our focus on a segment of the market characterized by inefficient information flows. However, in larger markets with more efficient information flows, Pembroke may use ETFs to provide exposure and diversification.
4. Fees and Purchase Information
4.1 What are the management fees for your funds?
Investment management fees are based on the size of the relationship with Pembroke and the mix of funds held. Relationship size includes all your accounts as well as accounts held by other members of your extended family, as established by the Family Advantage Program.
The fees of certain funds are reduced when the overall size of the relationship exceeds one million dollars, and further reduced at five million dollars, or when a segregated account is established.
The investment management fees for each mutual fund are detailed near the bottom of the second page of the Fund Facts documents. Click here to access the Fund Facts.
4.2 How are the investment management fees charged?
For most of our funds, the investment management fees are calculated daily and charged outside the fund monthly. This means fees are paid through a monthly redemption of units of the funds held.
There two exceptions to this:
- the F-Series funds, where the investment management fees are calculated daily and charged monthly inside the fund,
- the Pembroke Genesis Pooled Fund, where the investment management fees are calculated daily and charged monthly inside the fund for A Class units, and an additional performance fee is added to A Class units when applicable.
When a management fee is charged outside the fund, the performance of the fund is reported before fees, and when the management fee is charged inside the fund, the performance of the fund is reported after fees. All account performance reported on your monthly Pembroke account statements is reported after fees.
4.3 What is the Pembroke Family Advantage Program?
The Pembroke Family Advantage Program enables clients to extend many of the Pembroke benefits to virtually all members of their family. The definition of family member may include spouse, children, parents, grandparents, siblings, in-laws, extended relatives, as well as family members living with the aforementioned people.
Benefits include:
- Combined value of family holdings to determine management fees
- Waived minimum account size
- Private investor personality workshop
How to enroll?
Each family selects a primary investor who will be responsible for managing the family’s program. The family members who benefit are determined by the primary investor.
- Once the primary investor is selected, a list of all family members (and their relationship to the primary investor) can be provided to Pembroke, along with the appropriate paperwork for each family member.
- Family members will be enrolled upon completing the appropriate paperwork.
For more details, please contact your Pembroke representative.
4.4 Do you have trailing commissions?
No. Pembroke does not pay trailing commissions.
4.5 Do you have short-term trading or early redemption fees?
Yes. To discourage frequent trading you may be charged a short-term trading fee up to 2% of the total amount you bought if you sell or transfer your securities within 60 days of buying them. The fee is designed to protect other investors in the fund and is paid to the fund.
4.6 What are the minimum investment levels?
Generally, the minimum account value is $100,000, but certain exceptions may apply.
4.7 What are Management Expense Ratios (MERs)?
The Management Expense Ratio (MER) quantifies a mutual fund’s operating expenses as a percentage of the fund’s average net assets. Since the management fees are paid directly by you, they are excluded from the MER. The operating expenses are paid out of the fund before its return is calculated and are an indirect cost for investors.
4.8 What are Trading Expense Ratios (TERs)?
The Trading Expense Ratio (TER) is a measure of the fund’s trading costs. It represents total trading commissions (expenses) expressed as an annualized percentage of average daily net assets during the year. The TER is independent of a fund’s Management Expense Ratio.
4.9 Can I purchase your funds through my investment advisor?
Yes. Many Pembroke funds are available for purchase through Canadian discount brokers and Investment Advisors. Availability varies from one institution to the other.
If you are interested in purchasing one of our funds through channels outside of Pembroke Private Wealth Management Ltd., please contact one of our representatives for support at 514-848-0716 and we will help coordinate the transaction.
4.10 Do I have to be a Canadian resident to invest with Pembroke Private Wealth Management?
Non-residents of Canada cannot buy Canadian mutual funds. If you already own Pembroke mutual funds or pooled funds before you emigrate from Canada, you will not be required to dispose of them, and distributions can continue to be reinvested.
Canadian residency should not be confused with Canadian citizenship. Generally, Canadian citizenship has no bearing on your Canadian tax liability. Canadian citizens moving abroad are not considered residents of Canada for tax purposes simply because they have Canadian citizenship.
If you plan on moving abroad, you should speak to your Pembroke representative regarding any trading restrictions, and to your tax advisor to confirm any tax implications associated to the change in your residency status.
4.11 What is your cut-off time for trade instructions?
In order to ensure that client instructions are properly received and processed, Pembroke is introducing new cut-off times before the close of the markets on valuation days. These new cut-off times will come into effect in April of this year.
- If you wish to place a trade to purchase or redeem funds, or adjust the asset allocation of your account with Pembroke Private Wealth Management, the instruction must be received before 3:00 PM on a valuation day.
- If you wish to make a contribution or a withdrawal from an investment management account, or to implement changes to the investment guidelines at Pembroke Management, your instructions must be received at least 24 hours in advance.
- If you wish to open a new account, the duly completed account application form must be received and accepted at least 48 hours before the account can be funded.
Should instructions be received after these cut-off times, they will be processed on a best efforts basis, but could be delayed until the following valuation date.
5. Registered Plans
5.1 What is a registered plan?
Registered plans are accounts that are registered with the Canadian government for tax purposes.
5.2 What types of registered plans do you offer?
Pembroke offers Registered Retirement Savings Plans (RRSP), Registered Retirement Income Funds (RRIF), Tax-Free Savings Accounts (TFSA), Locked-in Retirement Accounts (LIRA), and Tax-Free First Home Savings Accounts (FSHA).
6. Dealer Resources
6.1 Where can I find Pembroke product information to help me meet my Know your Product (KYP) obligations?
On Pembroke’s website, under the section entitled “Our Solutions”, you will find documents and reports that include information to assess and monitor the securities offered by Pembroke management. Click here to access the page.
6.2 What are your fund codes?
Mutual Funds:
GBC312 — Pembroke Money Market Fund
GBC896 — Pembroke Canadian Bond Fund
GBC996 — Pembroke Corporate Bond Fund
GBC410 — Pembroke Canadian Balanced Fund
GBC990 — Pembroke Global Balanced Fund
GBC420 — Pembroke Dividend Growth Fund
GBC992 — Pembroke Canadian All Cap Fund
GBC311 — Pembroke Canadian Growth Fund
GBC310 — Pembroke American Growth Fund Inc.
GBC314 — Pembroke American Growth Fund Inc. (USD)
GBC313 — Pembroke International Fund
GBC991 — Pembroke Concentrated Fund, Class A
GBC991UA — Pembroke Concentrated Fund, Class A (USD)
GBC991F — Pembroke Concentrated Fund, Class F
GBC991UF — Pembroke Concentrated Fund, Class F (USD)
Pooled Funds:
GBC890 — Pembroke Global Equity Pooled Fund
GBC997 — Pembroke Canadian Growth Pooled Fund
GBC998 — Pembroke US Growth Pooled Fund
GBC9981 — Pembroke US Growth Pooled Fund (USD)
GBC700 — Pembroke Genesis Pooled Fund
*Note that “GBC” refers to the former name of our firm.
7. Taxes and Distributions
7.1 What are distributions?
Most Canadian mutual funds are structured as trusts. Investors receive units of the mutual fund trust as consideration for the capital they invest. The number of units is determined based on the net asset value per unit at the time of subscription.
The fund’s net earnings are allocated to investors based on their proportionate holdings in the Fund. The allocations of earnings by the fund to investors are called distributions.
7.2 Why do mutual funds pay distributions?
The primary objective of distributions from a fund is to pay out sufficient taxable income (including net capital gains), so that the fund itself is not subject to income tax. Earnings retained by a Fund are generally otherwise subject to tax at the highest marginal rate.
The Fund’s net earnings are allocated to investors based on their proportionate holdings in the Fund.
7.3 What are the distribution payout options?
As an investor, you may request your distribution to be paid in cash or by way of receiving additional units of the Fund (or of a different fund). The latter option is referred to as a distribution in kind.
7.4 When are distributions made?
The timing and frequency of the distributions vary from fund to fund. Please see the timing for each mutual fund distribution here.
7.5 How are distributions taxed?
Mutual funds and pooled funds held by Canadian residents within their non-registered accounts are subject to income tax at the investors’ relevant tax rate. Distributions from funds are noted on T3 slips and Relevé 16 (for Quebec residents) issued to Canadian residents for income tax purposes.
7.6 When are tax slips distributed?
Tax slips are issued to each investor before the statutory deadline of 90 days following the year-end of the trust.
7.7 How do distributions impact the book value of my investments?
Distributions that are received in kind are added to the investor’s book value. Distributions that are received in cash are not added to the investor’s book value.
7.8 What is the difference between a mutual fund trust and mutual fund corporation?
Unlike mutual funds structured as trusts, mutual funds structured as corporations do not allocate their earnings to investors. Instead, the Board of Directors of the mutual fund corporation may pay a dividend (either a cash or a stock dividend). The value of the dividend is included in the investor’s income for tax purposes.
8. Corporate Governance and Responsible Investing
8.1 How do you consider environmental, social and governance factors (ESG)?
At Pembroke, we incorporate environmental, social and governance (ESG) factors into our investment research. We score each factor and use these scores to prompt inquiries and engagements by portfolio companies and portfolio candidates.
8.2 Are you a signatory of the United Nations-supported Principles for Responsible Investment?
Pembroke became a United Nations-supported Principles for Responsible Investment (PRI) signatory in 2019.
8.3 What is your approach to stewardship and responsible investing?
The objective of Pembroke’s stewardship activities is to help our clients secure their financial future and to maximize long-term sustainable value. The firm’s business and investment philosophies are rooted in the concepts of active ownership, good stewardship and aligned interests.
An example of good stewardship is whether a company’s CEO is more interested in the performance of their firm rather than their pay. An example of aligned interest is how much of its own net worth a company’s management has tied to ownership of their firm. By ownership we mean actual share ownership, not ownership of stock options.
Our approach to stewardship is informed by our values, our investment philosophy, and our commitment to inquiry, engagement, collaboration, and transparent reporting. Pembroke’s stewardship activities cover all the firm’s investment products and include, but are not limited to, monitoring the companies in which we invest and the managers we hire, using our influence to engage with companies, and reporting on our engagement and proxy voting activities.
Pembroke believes that companies have a responsibility to act in the long-term interests of their stakeholders to maximize value and, as investors with long time horizons, we recognize the fundamental importance of environmental, social and governance factors.
Pembroke’s Stewardship Policy is available here.
8.4 Do you publicly support the Task Force on Climate-Related Financial Disclosures (TCFD)?
Yes, Pembroke publicly supports the Task Force on Climate-Related Financial Disclosures (TCFD).
8.5 Who is Pembroke’s auditor?
Deloitte S.E.N.C.R.L. serves as the auditor of Pembroke Management, Pembroke Private Wealth Management and the Pembroke family of funds.
9. Unclaimed Property Policy
Unclaimed property refers to financial assets that have been abandoned or left dormant by their rightful owners for an extended period of time.
The provinces of Alberta, British Columbia, New Brunswick and Québec have enacted unclaimed property legislation aimed to connect unclaimed property with their rightful owners, and where those efforts are unsuccessful, to deliver the property to a government authority. The process for claiming unclaimed property varies depending on the jurisdiction and each jurisdiction will have its own unclaimed property registry or database where individuals can search for and claim their unclaimed assets.
To learn more and for details pertaining to each province, please click here. Should you need any support or have questions, you can also contact us at compliance@pml.ca.
10. Other
10.1 What is the difference between Pembroke Management Ltd. and Pembroke Private Wealth Management Ltd.?
Pembroke Management Ltd. (PML) is a portfolio manager regulated by the Canadian provincial regulatory authorities, as well as the US Securities Exchange Commission and other regulatory entities in Europe.
Pembroke Private Wealth Management Ltd. (PPW) offers a range of investment solutions to investors and is registered with the New Self-Regulatory Organization of Canada (New SRO). The management for these investment solutions is outsourced to a portfolio manager. The majority of PPW’s strategies are outsourced to (or sub-advised by) Pembroke Management Ltd.
10.2 What is the difference between discretionary and non-discretionary investment accounts?
A discretionary account opened with a portfolio manager such as Pembroke Management Ltd. (PML) gives the manager the authority to purchase and sell securities in the name of a client. This type of mandate is limited to transactions and any withdrawal of funds from the account requires written client approval.
A non-discretionary account refers to an arrangement between clients and brokers or, in the case of funds, clients and mutual fund dealers. The dealer does not have the “discretion” to invest client money as it deems appropriate. The dealer follows the client’s instruction to invest in a specific fund with a defined objective.
However, the dealer must hire, and hence give discretion, to a portfolio manager to manage the fund for which it has raised money. This fund typically has many client investors. The difference between the discretionary management of a fund and the discretionary management of a single client’s assets is where confusion sometimes arises.
10.3 What is the difference between growth investing and value investing?
Growth and value investing are often positioned as opposing concepts. However, the longer an investor’s time horizon is, the more closely they resemble each other. The key difference is often the starting point.
Growth investors typically search for younger and often smaller companies that have the potential to grow revenues and earnings at a rapid pace. This might be a result of a new product or new service, a strong competitive advantage, or the discovery of a new market. The growth investor will then consider numerous financial factors and whether this growth potential is appropriately priced.
Value investing is an investment strategy that involves picking stocks that appear to be trading for less than their intrinsic or book value. A value investor seeks out companies that appear undervalued based on manager experience and consensus earnings estimates. Once a security is identified as being undervalued, either in absolute terms or relative to its peers, the manager will determine the extent of the value discount. They will also establish whether that discount is justified by factors such as poor management or a weak balance sheet or is due to the failure of the market to recognize a mispricing.
10.4 What is a self-regulatory organization and how does it protect me?
Pembroke Private Wealth Management is a member of the Canadian Investment Regulatory Organization (”CIRO”), which is the national self-regulatory organization that oversees all investment dealers, mutual fund dealers and trading activity on Canada’s debt and equity marketplaces.
CIRO is committed to the protection of investors. It sets and enforces rules for the business and financial conduct of investment and mutual fund firms and their representatives across Canada. All registered representatives are subject to high proficiency standards, training, and supervision by member firms.
As of January 1, 2023, CIRO has assumed the regulatory responsibilities of the Mutual Fund Dealers Association of Canada (“MFDA”) and Investment Industry Regulatory Organization of Canada (“IIROC”). For more information, please visit the CIRO websites.
The Autorité des marchés financiers (“AMF”) will continue to supervise the mutual fund dealers registered in Québec during a transition period in order to integrate their Québec activities under CIRO. CIRO’s regulatory requirements, with the exception of the rules necessary to ensure its smooth functioning, will not apply to the dealers’ activities in Québec during this period. More information regarding the AMF’s plan for transitioning the oversight of mutual fund dealers in Québec can be found on the AMF website.
10.5 Who owns Pembroke?
Pembroke has always been 100% employee owned. Any team member identified as a Partner is an owner of the firm.
10.6 How do I make a complaint?
If you are not satisfied with your experience at Pembroke Management or Pembroke Private Wealth Management, you have the right to report a complaint and to seek resolution of the problem.
Please refer to The Client Complaint Information Form (CCIF), which provides general information about your options for making a complaint and the escalation options.
10.7 What makes Pembroke different from other Investment managers?
Pembroke was founded in 1968. Its long history, clearly defined focus and the stability of the firm ownership have contributed to low investment team turnover and a high level of client retention.
Pembroke has five core values: Integrity, Excellence, Accountability, Humility and Alignment. While the first three values are required in the industry and extremely important, we feel that Humility and Alignment are the core values that differentiates Pembroke.
Humility: curiosity, introspection and intellectual honesty promote learning and improved decision-making. We seek and provide clear feedback. We trust and respect our colleagues and do not underestimate the competition.
Alignment: we align our interests with our clients and invest alongside them. We work as a team. We are socially engaged and quietly act as good corporate citizens.
10.8 How are my assets protected?
Customers’ accounts are protected by the Canadian Investor Protection Fund (“CIPF”) within specific limits. Customers with accounts in Quebec are generally not covered by the CIPF. Please refer to the CIPF Coverage Policy on the website at www.cipf.ca for a description of the nature and limits of coverage or contact the CIPF at 1-866-243-6981 or info@cipf.ca.
10.9 What are the values of your firm?
Pembroke has five core values: Integrity, Excellence, Accountability, Humility and Alignment.
We believe that the first three are required by all participants in our industry, and that Humility and Alignment are the core values that differentiate us from many other firms.
Humility: curiosity, introspection and intellectual honesty promote learning and improved decision-making. We seek and provide clear feedback. We trust and respect our colleagues and do not underestimate the competition.
Alignment: we align our interests with our clients and invest alongside them. We work as a team. We are socially engaged and quietly act as good corporate citizens.
10.10 What is Pembroke’s mission and vision?
Our mission at Pembroke is to help our clients secure their financial futures.
Pembroke’s vision is to be a premier investment boutique for discerning investors.
