Our 10-Step Investment Process


1) Understanding your investment objectives

The first step in our process is to develop a financial plan. The plan sets out your financial goals and circumstances, including your desired returns, estimated timelines, and risk tolerance. To do this, we start by getting to know you. We understand that no two families are alike and that each of us define happiness differently. When helping you through a transition, we need to consider your personal family goals and values to ensure your future is comfortable. Our purpose in working with families is to help them find natural simplicity within all the complexity life can bring. After we develop a good understanding of your goals and objectives, we can turn our focus to your cash flow. By tracking cash going in and out, we can determine your spending rate. We then use this rate to calculate the minimum amount you’ll need in returns, while taking into account your draw rate, taxes, fees, and inflation.

2) Implementation of our investment beliefs

One of our clients’ once said, “If you make me 50%, you won’t change my lifestyle, but if I lose 50%, it will”. The responsibility to earn and maintain this trust and integrity continues to be reflected in our investment philosophy and process today.

We have three primary beliefs about investing for clients. These beliefs work together to provide a highly functioning investment strategy that clients have confidence in. We believe that volatility should be controlled, asset allocation is more important now than in the past 30 years due to low interest rates, and ultimately the investment solution must be tailored to each client as part of an overarching process rooted in objective advice for clients.



3) Leverage the Private Investment Management (PIM) program

The PIM program is exclusive for discretionary-licensed Portfolio Managers like our team. The process begins by defining each client’s unique investment objectives and strategies in his or her personalized Investment Policy Statement (IPS). Once the IPS is submitted to the program, clients benefit from quality and diversification guidelines monitored independently by risk managers as well as bulk trading to ensure clients are treated equally.

4) Bench strength provided by the Portfolio Advisory Group (PAG)

Comprised of members situated in Canada, U.S., Hong Kong, and London, the Portfolio Advisory Group provides support, research, and security selection in assembling portfolios of marketable securities such as equities, fixed income, ETFs, and structured products. Situated within RBC Wealth Management, PAG is independent of any investment banking groups and is focused on delivering objective and independent insights.

PAG aims to provide timely and leverageable support in the form of:

  • Guided portfolios that address asset allocation, sector, and security selection strategies for ETF, equity, and fixed income

  • Internal research publications that support model portfolios, summarize relevant research and news events, and provide additional insights and actionable ideas

  • World-class client communications highlighting RBC Wealth Management outlook and topical investment themes

  • Efficiency-enhancing tools to support conversations about risk tolerance, asset allocation, and portfolio proposals

5) Research

One of the core advantages of PIM is the ability to access the best ideas from both internal as well as external sources. Since we are not restricted to proprietary product, we can implement ideas and leverage research from third party money managers around the world. One Canadian example of this is Veritas, whose forensic-accounting-based research is available to select pension plans and institutional investors. RBC Dominion Securities is the only retail advisor in Canada with access to Veritas’ independent research, giving us a competitive advantage over our peers.



6) Weekly investment meetings

Collaboration and efficiency are central to everything we do. Within our investment management process, we divide the areas of interest among our four-person investment team to allow us to cover more ground and better share ideas. Danielle, Brent, and Anita are all CFA charterholders and Oskar is a MBA. We set aside time every week to share insights from the past week as well as to discuss client-specific investment changes or cash flows that may be pending.

7) Annual and ad-hoc rebalancing

Many studies have tried to quantify the value of security rebalancing and the optimal frequency to do it. In our view, annual rebalancing makes the most sense as it balances three important factors:

  • It allows your winners to run

  • It reduces unnecessary tax implications for non-registered accounts

  • It provides a systematic way to capture profits and maintain the desired asset allocation and risk profile over time

In addition to our formalized annual rebalancing, we will periodically rebalance portfolios as part of a client’s cash flow needs or changes in overall portfolio and client objectives.

8) Annual tax loss selling

Tax-loss selling is a strategy that involves selling securities at a loss to offset capital gains and the associated taxes realized by other investments. Each year, we review every client's non-registered accounts for opportunities to harvest losses. This process takes into consideration various factors, including gains realized in both current and prior years (net losses can be carried back up to 3 years), gains realized in our portfolio or elsewhere, and charitable intents or donations made.

9) Defense: pre-defined incremental plan to improve portfolio quality

We are constantly on the lookout for signs that an economic recession and therefore an equity Bear market could be near. We focus on bear markets as opposed to corrections. Corrections tend to be smaller in duration and magnitude. This makes them more difficult to trade around and our “Low Vol” philosophy (step #2) can protect portfolios in such an event. So if we believe we are approaching a Bear market, we follow our 5 step process to protect clients. This incremental process has been developed by drawing heavily on our experiences in past Bear markets and vetted by RBC’s investment strategist:

  1. Pay off debt

  2. Raise cash for any draws

  3. Increase fixed income quality

  4. Reduce niche growth positions

  5. Shift equity to bonds

10) Constant review and monitoring

Client portfolios are reviewed and monitored on two levels. Firstly, our team is able to regularly review the portfolio positions and implementation strategy as well as connect with clients to see if individual circumstances or investment objectives have changed. This frequent review is possible as we have a high number of investment professionals relative to the number of families we work with. Secondly, RBC independently does a compliance overview on an ongoing basis to ensure portfolios are within client’s individual IPS guidelines.