Household Balance Sheet

The Household Balance Sheet analytical framework represents the cornerstone of our ongoing research into the demand and supply trends in the Canadian financial services industry. Underpinning our extensive analytical capabilities in this arena is a set of unique databases tracking a broad spectrum of industry information. The description below starts with the two core databases supporting our key perspectives on the Household Balance Sheet: the Classic Balance Sheet, which quantifies total assets and liabilities, itemizing them in a comprehensive structural map of the financial instruments landscape, and the Wealth Market Balance Sheet, which encompasses those financial assets held for the purpose of accumulating household financial wealth.

Classic Balance Sheet

• comprehensive measurement of retail financial services market in Canada
• historic annual data from 1961 to 1989
• comprehensive annual data from 1990 onward, with
  projections to 2014
• quarterly data available from 1990 onward
• data on 67 major asset, liability and net worth component
  

Wealth Market Balance Sheet

• a subset of discretionary financial assets within the
  HBS framework
• encompasses those financial assets held for the purpose of accumulating household financial wealth
• wealth market data is organized using five major lenses:

» product, in which financial assets are
divided into three categories: spread-based,
transaction-based, fee-based

» asset mix, in which financial assets are
divided into three categories: cash and
equivalents, fixed income, equities

» distribution channels, in which financial
assets are allocated across eight channels:
branch networks, online/discount brokers,
pure direct sellers, branch advice, dedicated
sales forces, independent advisors, full-
service brokers, private client management

» tax status, in which financial assets are
divided into taxable and tax-deferred
components

» segments, in which financial assets are
allocated into seven asset segments,
seven life stage segments, and seven
income segments

• annual data on all components except distribution channels from 1990 onward
• annual data on distribution channels from 1995 onward
• quarterly data available from 2004 onward
  

Provincial Balance Sheets

• data on all major components of discretionary financial assets
• historic annual data from 1994 onward
• quarterly data from 1999 onward
  

Segmentation

• wealth market assets segmented by asset threshold, age, income (also cross-classification of these criteria)
• annual data from 1994 onward
• data on over 13 million family and single-person household units
• geographical detail for Canada, 13 provinces and territories, and 400 cities

» seven asset segments from under $50,000 to
over $1 million
» seven income segments from under $50,000
to over $250,000
» seven age segments from under 25 to over 75

Managed Money

Fee-based Programs

• covers the entire universe of fee-based programs in Canada, including fund wraps, fee-based brokerage, advisor managed, in-house managed wraps, and separately managed wraps
• quarterly assets data from Q4 1996 onward
• annual data on fee-based assets by distribution channel from 1998 onward
• data on 173 programs offered by 50 companies as of June 2006
• coverage of each program's inception date, sponsorship category, minimum investment, source of funds (proprietary or third-party), and sub-advisors
• includes pricing tabulations for each program from December 1998 onward
• includes detailed competitive intelligence on each program (e.g. program structure, distribution, pricing, questionnaires, reporting, etc.)

Fund Wrap Portfolios

• covers every portfolio available through fund wrap programs in Canada
• tracks the fund composition of each fund wrap portfolio
• quarterly data on individual fund weighting within each fund wrap portfolio
• includes an embedded link to the Mutual Fund, Life Insurance Segregated Fund and Fee-based Program Databases, enabling multi-faceted analysis of the impact of the fund wraps business on investment funds industry
  

Money Managers

• annual data from 1992 to 2002; semi-annual data from 2003 onward
• detailed company and product-specific data on assets under management and assets under administration for over 300 firms, both foreign and domestic
• data categorized based on how the assets are managed: internally, sub-advised for others, sub-advised by others
• data organized into nine market segments: pension, endowment, institutional, private client, mutual funds, segregated funds, fee-based programs, closed-end funds, hedge funds
• private client segment subdivided into separately managed accounts, comingled, estates and trusts, personal endowments
• data gathered through proprietary surveys and from secondary sources
• sub-advisory data available on a quarterly basis for mutual funds, segregated funds, fee-based programs, closed-end funds
  

Distribution Channels

Retail Brokerage Industry

• based on a survey of 20 full-service brokers and 11 online/discount brokers as of June 2006
• high-level annual data from 1994 to 1996; comprehensive quarterly data from Q4 1996 onward
• full-service channel

» assets and accounts – data on assets and
asset classes; breakdown by investment
vehicle, tax status, number of accounts
» revenues
» trading
» segmentation – advisor analysis, Big Six
analysis, regional analysis
» product analysis – comprehensive analysis
of the fee-based offerings of full-service
brokers; quarterly data on the insurance
business of full-service brokers (including
breakdown by sales force and insurance
product) from Q2 2000 onward
» insurance products covered include
universal life, money products, term life,
disability, and long-term care
» insurance products broken down by policies
placed, face value, suppliers, revenues

• online/discount channel:
  

» trading
» revenues
» assets and accounts – data on assets and
asset classes; breakdown by investment
vehicle, tax status, number of accounts
» segmentation – Big Six analysis

Full-service Brokerage Profitability

• detailed data from 14 firms responsible for over 90%
  of all assets administered by full-service brokerage firms in Canada
• full participation of the Big Six bank-owned firms
• quarterly data from March 2003 onward
• revenue data:

» breakdown of key revenue sources –
transaction-based, fee-based, spread-based
» further breakdown to 16 line items for
product / service lines of business

• expense data:

» front office, mid- and back office, head office
» compensation related expenses including
grid payouts, recruitment/retention bonuses,
deferred revenues
» firm-paid branch expenses including branch
manager compensation, sales assistant
costs, occupancy and IT costs
» regional office and head office expenses
including transactional costs, systems
development costs, compliance and legal
costs, and other allocated costs arising from
operations and processing function
» parent company expenses and their
allocation to the brokerage business are
captured separately where applicable (i.e.
bank-owned firms)

• operational statistics:

» detailed counts on transaction volumes by
product/service type are tracked against the
same product/service asset and revenue
data that is collected
» total assets and number of accounts and
new accounts opened are tracked
» headcounts are tracked for advisors, sales
assistants, branch managers (producing and
non-producing), head office staff and other to
provide a complete FTE picture across each
firm

Investment Funds Industry

Detailed investment funds data resides in two key databases: the Insight Mutual Funds Database and the Insight Life Insurance Segregated Funds Database. These are the most comprehensive fund-by-fund information management databases of their kind in Canada. They are linked to four other Insight databases: Index Funds, Regional, Mutual Fund Distribution Channels, Mutual Fund Optional Load. With the exception of the Optional Load Database, the entire family of Insight databases is constructed on a fund-level basis. Unique fund codes and date combinations serve as common links between all data. This bottom-up approach maximizes the usefulness of our databases in performing customized research, and ensures a high degree of flexibility in generating output. The following is an outline of the key features of each of the Insight databases.

Mutual Funds

• covers the entire universe of mutual funds in Canada (including labour-sponsored venture capital funds)
• monthly data from December 1990 onward
• includes more than 2,100 mutual funds as of June 2006
• data on assets, gross sales, reinvested dividends, redemptions and redemption rates, transfers in and out, net sales, net flows, management expense ratios, outflows and outflow rates, maximum sales charges
• includes information on each fund's load structure, asset class, manufacturer, sponsorship classification, and investment advisor/sub-advisor
• data organized into 35 asset classes: five classes of short-term funds and 30 classes of long-term funds
• includes 106 fund complexes as of June 2006
• all individual funds and fund complexes are assigned to one of seven sponsor categories: deposit-takers (i.e. banks, trust companies, credit unions), independents, exclusive agents, direct sellers, life insurers, unions and associations, brokers
  

Life Insurance Segregated Funds

• annual data by fund from 1990 to 1996
• monthly data on individual funds from June 1997 onward
• data on more than 1,300 individual funds as of June 2006 and more than 1,000 group funds as of December 2004
• includes 23 fund complexes as of June 2006
• data at the fund level according to numerous criteria (e.g. assets and net sales by fund; assets and net sales by fund complex for individual business; assets by complex for group funds; assets and net sales by asset class for group business)
• data organized into 35 asset classes: five classes of short-term funds and 30 classes of long-term funds
• annual coverage of regional distribution of assets and distribution channels
• data for selected companies on premiums and withdrawals, management expense ratios, load structures, guarantees, and re-wrapping of mutual funds
  

Index Funds

• tracks mutual and life insurance segregated index funds and exchange-traded funds
• monthly data from December 1990 onward
• includes specific characteristics of index funds, such as indexing type, benchmark followed, and maximum MER level (if applicable)
• funds assigned to one of four categories: passive classic, passive derivative, enhanced active, enhanced benchmark
• same asset classification as the Mutual Funds and Life Insurance Segregated Funds Databases (data organized into 35 asset classes)
• data on 149 funds and 28 fund complexes as of June 2006
• data on sales, redemptions, and net flows by complex
• detailed information on management fees, management expense ratios
  

Regional

• quarterly data from 1996 onward
• quarterly data on gross sales and redemptions from 1999 onward
• provincial distribution of mutual fund assets, net new money, gross sales, and redemptions by complex
• two major asset classes (long-term and short-term) and three major sponsorship categories (independents, deposit-takers, other)
• survey participation in excess of 90% of industry assets

Mutual Fund Distribution Channels

• quarterly data from Q4 1994 onward
• quarterly flow data from 2000 onward
• identifies eight distribution channels that mutual fund companies/complexes are present in: branch networks, online/discount brokers, pure direct sellers, branch advice, dedicated sales forces, independent advisors, full-service brokers, private client management (semi-annual data)
• identifies institutional relationships of mutual fund companies' with funds in other companies' programs, segregated funds, and defined contribution plans (assets data)
• assets, net sales, gross sales, and redemptions by distribution channel
• data can be cross-referenced with manufacturing/sponsorship data to afford both a distribution channel and a manufacturing view simultaneously (e.g. how are bank-manufactured funds distributed? what are the distribution channels for independent-sponsored funds?)

Mutual Fund Optional Load

• quarterly data from 1996 onward
• quarterly net flow data from 1997 onward
• quarterly gross sales and redemptions data from Q2 2000 onward
• breakdown of the optional load category into front-end and back-end components
• data is gathered on a sponsor (fund complex) level
• assets, net sales, gross sales, redemptions by front-end versus back-end load
  
  

Alternative Investment Products

Hedge Funds

• data on over 200 hedge funds from more than 70 sponsors as of December 2005
• annual data from December 1999 to December 2005
• semi-annual data from December 2002 onward
• data at the fund level includes:

» assets
» sales and redemptions
» asset distribution by investment strategy
» asset distribution by investor type
(retail/institutional and institutional)
» segmentation by product type (stand-alone
hedge funds, funds of hedge funds, principal-
protected hedge fund products)
» sub-advisory information
» fee and compensation structures
(management fees, performance fees, hurdle
rates, highwater marks, sales charges, trailing
commissions)
» other qualitative features of hedge funds
(investment minimums, RSP-eligibility, legal
structure, availability to Canadian investors,
share classes, prime brokers)

• data on 70 instruments from more than 20 issuers
• multiple lenses (e.g. index tracked, tax status, maturity, sponsor category, company)
• nine years of history (total outstandings, gross sales, net flows):

• competition and market share by sponsor (banks and trust companies, credit unions, life insurers and subsidiaries)
• detailed competitive intelligence highlighting product features and operational characteristics (e.g. type of instrument the product is linked to, participation rate, cap rate, formula used to calculate the return)

Market-linked Notes

• comprehensive data on more than 500 products and 50 market participants
• data broken down by type of market-linked note (mutual fund, hedge fund or index fund), investment vehicle it tracks, and asset class/objective
• data by issuer, manufacturer/distributor, and sponsor/sub-advisor
• coverage of each product's issue date, issuer, sponsor, maturity date, term to maturity, minimum investment, minimum return at maturity, face amount, fees and expenses, cap rate, participation rate, return calculation, product structure, early sales charges, distributions, and frequency of distributions
• assets outstanding by individual product from 1996 onward

Closed-end Funds

• data on over 260 funds from 70 managers as of
  June 2006
• annual data from December 1998 to December 2004
• quarterly data from December 2004 onward
• monthly data on assets, market prices and units outstanding starting in 2006
• data is organized into several thematic databases, all connected through a common individual fund code:

» current fund data – monthly net assets, net
asset value per unit (share, class of share),
market price, QMV
» IPOs – data on gross proceeds, overallotment
options, minimum and maximum IPO,
inception and maturity dates, fiscal year end,
minimum investment
» classes of shares – types of classes issued,
details on agent fees, IPO price, minimum and
maximum number of units
» flows – annual data on inflows, redemptions,
subsequent issues, reinvested dividends, fund
repurchase activity
» redemptions – details of fund redemption
features, mandatory repurchase agreements
» fees – details of management and
trailer/service fees
» plan of distribution – information on agents
and agent fees
» investment advisors to closed-end funds

Credit

Mortgage Brokers

• based on comprehensive surveys of 502 mortgage brokers
• data collected in February 2005
• accurate, national distribution of respondents
• results are statistically significant to within +/‑ 4%, 19 times out of 20
• includes channel and broker-level data for origination volumes, number of deals, number of clients, product mix, client mix, credit mix, mobility, compensation
• detailed statistical data describes the effectiveness of various attraction and retention tactics, as well as a comprehensive ranking of lenders across seven categories: innovation, product development, compensation, broker service, getting the deal done, interest rate competitiveness, overall preference
• aggregate and granular data can be segmented by variables such as geography, brokerage firm, broker age, broker experience, performance (high performers/low performers); as well as many attitudinal and behavioural variables such as lender preference, satisfaction levels, effectiveness of incentives