Operations Memo

OM_2022-13; Updates to w.Connect Regarding Risk Tolerance & Investment Objectives

For more information, contact:

Advisor Services Team
advisorservices@gpwealth.ca

Date Issued:

December 15, 2022

With an update to w.Connect, you will now have the ability to better assess the Risk Tolerance and Investment Objectives to ensure suitability of a client plan.

Risk Suitability Tab 

You will now see GICs included in a plan and will be able to take them into account as part of the Risk Suitability calculations.

New: Investment Objective Suitability Tab

With a new Investment Objective Suitability tab, you will now see a breakdown of funds in each Investment Objective category. In the example below, the plan is not suitable because the holdings have 0% in Income whereas the KYC calls for 50% Income.

Important Note:

The “Safety” category represents GIC, Money Market and High Interest Accounts and are treated as “Income” and therefore would meet the income objective suitability requirement.

Suitability Triggers when Placing Trades

As you know, when placing a trade there is a tab for Risk Suitability and you receive a warning when a trade will put the plan offside for Risk Tolerance.

There is now a tab for Investment Objective Suitability, which will give you a warning when the investment objective composition does not meet the stated plan investment objective on the KYC.

Important Note:

It is possible, that a trade may not put a plan offside for risk, but it will put the plan offside for investment objectives. An example would be the plan has too much "growth" and not enough "income".

How are Balanced Funds treated?

As you know, not all Balanced Funds are the same in terms of weighting between income and growth. Each balanced fund approved on the system has been setup with weightings for income and growth.

It should also be noted that balanced funds will show up on the Investment Objective Suitability tab twice, under both the Income and the Growth categories. For example, the Mackenzie Cundill Canadian Balanced fund below.

It goes without saying that if a warning for either Risk Suitability or Investment Objectives Offside appears, you need to review and address it before placing the trade(s).

As always, if you have questions or comments, contact the Advisor Services Department by email at advisorservices@gpwealth.ca.