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Tax season
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Tax season
by Scott Ronalds
The mercury's finally climbed into the double digits (in Vancouver, at least), cherry blossoms are itching to bloom, and it's still light out at 7pm. Spring has finally arrived! And with it, tax time. Canadians have until April 30 to file individual tax returns, but many of us do it earlier to avoid the last-minute scramble and to get our hands on any refunds we may be owed.
To assist with your filing, below are the tax documents that you should have received from us this year based on the type of account(s) you hold, along with a brief explanation of their purpose.
Non-registered investment accounts
If you hold a non-registered account, which simply means an investment account other than an RRSP, RRIF or TFSA, we send you a T3 slip for each Steadyhand fund you hold. T3 slips show the capital gains, dividend income (and corresponding dividend tax credit, if applicable), and other forms of investment income that you're responsible for claiming on your return. These slips were mailed in mid-February.
Note that T3 slips do not include any capital gains (or losses) that you may have incurred from selling or switching units of Steadyhand funds in your non-registered account. The details of your personal transactions can be found on your quarterly account statements.
RRSPs
If you made a contribution(s) to your RRSP between March 2, 2018, and December 31, 2018, we send you an RRSP Contribution Receipt for the total amount of contributions you made over this period. These receipts were mailed in mid-January. If you made a contribution(s) between January 1, 2019, and March 1, 2019, we send you a separate receipt for any contributions made in the first 60 days of the year (this amount can be applied to your 2018 tax return, or to a future year if you choose). These 'first 60 days' receipts were mailed the week of March 11.
If you made a redemption from your RRSP in 2018, we send you a T4RSP slip. This slip shows the amount of any redemption(s) you made as well as any withholding tax that we remitted to Canada Revenue Agency (CRA) on your behalf. These slips were mailed at the end of January.
RRIFs
If you hold a RRIF, we send you a T4RIF slip. This slip shows the amount of your redemptions (including your minimum payment and any additional redemptions you may have made) as well as any withholding tax that we remitted to CRA on your behalf. These slips were mailed at the end of January.
TFSAs
If you hold a TFSA, you do not receive any tax slips from us. These accounts are exempt from tax, and any contributions/withdrawals do not generate any tax-related documents. You should be sure, however, to adhere to the maximum contribution limits for these accounts and the rules relating to re-contributions if you do make a withdrawal.
By now, you should have received all your tax-related documents from us. If you've misplaced your originals or never received a slip/receipt you think you should have, please contact us at 1-888-888-3147.
Happy filing!
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State of the Union
by Scott Ronalds
2018 was a challenging year for investors as virtually all major stock markets declined. The fourth quarter in particular was no fun as stocks around the globe entered correction territory (defined as a decline of 10% or more).
Yet, we're now 10 weeks into 2019 and markets have rebounded sharply. Indeed, many markets have fully recouped their 2018 losses. It's been a great lesson as to why investors need to look past short-term volatility and alarmist headlines, and keep a steady hand on their portfolio. We like to think we helped our clients do just that in 2018. We saw no panic selling and our clients in fact added money to their portfolios on balance when the rest of the industry was facing redemptions.
Below is our annual update on some of the business metrics you might be interested in and where we're focusing our strategic efforts in 2019 and beyond. (Note: this year's update is coming a little later than normal as we wanted to include our two new funds in the discussion, which were launched in February).
Performance
When we take all our clients' statements and average their returns for 2018, their accounts declined by -5.5% in the year (using the money-weighted methodology). Over the last five years, the annualized number is +4.2% (per year), and over the last 10 years it's +7.4%. We're not thrilled with these short- and medium-term numbers, which fall in the middle of the pack when compared to our competitors and are lagging the markets. Our long-term numbers, however, are near the top of the pack and remain ahead of the markets in general.
Assets under management
At the end of the year, we managed $788 million for investors. Our asset base grew by $18 million, or 2%, over the year. While this growth is modest, many money managers saw a decline in their assets under management (AUM) in 2018. As a side note, our total assets at the time of writing are up to roughly $850 million.
Clients
We welcomed aboard 365 new clients in the year. Of those, 234 are working with us directly, and 131 purchased our funds through third-party dealers (e.g. discount brokers).
Our client base is now 3,360 investors strong, stretching from B.C. to Ontario. Our average client is 56 years old and holds two of our funds.
Notable events
2018 was a busy year on many fronts. We welcomed three new employees to the team in Vancouver: Jeff Stashuk (Associate Investor Specialist), Priya Sharma (Office Manager), and Lisa Guo (Associate Investor Specialist). Jeff and Lisa are working closely with Chris, Lori, Evan and Sher in helping our clients build and manage their portfolios, while Priya is running the office and freeing up time for us all in the process. Our team is now 16 professionals strong (13 in Vancouver and 3 in Toronto).
For a firm with deep patience for its stock pickers and an intentionally small lineup of funds, it was an unusually busy year on the investment front, as we announced a manager change and introduced two new funds to our lineup. We replaced the manager of our Global Equity Fund in August, when Velanne Asset Management took over for Edinburgh Partners. We elaborate on our reasons for the change here.
The new funds — Steadyhand Global Small-Cap Equity Fund and Steadyhand Builders Fund — were technically launched in 2019, but much of the legwork was done in 2018. Both funds are designed for growth-oriented investors with long time horizons. The Global Small-Cap Fund offers our clients exposure to an attractive asset class that's hard to access at a reasonable price, and the Builders Fund offers a simpler way to invest across our equity line-up. You can read more about them here, or watch our videos with the managers here: Global Small-Cap; Builders.
On the technology side, Neil was busy laying the groundwork for an upgrade to our client and portfolio management software. Those of you who work in technology know that this is no small project. The new software will provide us with some features and functionality that will allow our Investor Specialists to serve you even more efficiently going forward.
We covered all these topics and more in our annual client presentations across the country last month. If you weren't able to attend one of the sessions, you can watch the Vancouver event in its entirety here.
2019 and beyond
We invested heavily in our business in 2018 by adding three new employees and upgrading our systems, and we'll be doing more of the same this year. One thing you can look forward to is an update to our client portal — we're overhauling its look and functionality to provide you with a better user experience. We anticipate the enhancements will be ready in the fall.
We're confident that we've built a top-notch platform from which to serve you and many more discerning investors in the coming years. Our vision is to be the most investor-centric firm in Canada, and a recent Morningstar article suggested we're right on track: "Steadyhand is one of the country's most transparent and investor friendly firms."
Management fees and expenses all may be associated with mutual fund investments. Please read the prospectus before investing. Mutual funds are not guaranteed, their values change frequently and past performance may not be repeated. The indicated rates of return are the historical annual total returns including changes in unit value and reinvestment of all distributions and do not take into account sales, redemption, distribution or optional charges or income taxes payable by any securityholder that would have reduced returns.
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Recent Articles:
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Two new funds at Steadyhand
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