Marquest American Dividend Growth Fund (Corporate Class)

Third Quarter 2015 Review

Market Commentary
Just ahead of the third quarter, we saw equity markets end Q2 with a thud,
as events in Greece and China raised concerns about prospects for world
growth. Those concerns expanded in the third quarter. The phrase may you
live in interesting times comes to mind, as investors grappled with the potential impact of these macro events. By the end of August, the slowdown in
China had once again raised questions about world growth, just as the markets were bracing for the U.S. Federal reserve to raise interest rates by 25 basis
points in September. Taken together, this was enough to push markets lower,
to officially dip into correction territory. So far, the dramatic low reached on
August 24 has held, as markets churn daily to regain their footing. On a positive
note, the U.S. is still a beacon of hope in an otherwise dull global economy.
During the quarter, the S&P 500 Index registered its first correction of more
than 10% in four years. While the recent market dip is top of mind for investors, it may be worth considering that it is common for markets to correct from
time to time. Markets dont go straight up endlessly. It is sometimes painful
to be reminded that there is an inevitable ebb and flow in financial markets.
In the meantime, central banks around the world remain accommodative
with their monetary policies and the U.S. economy continues to grow at a reasonable rate. With this as a background, we continue to look for good values
among stocks of sound companies. The bloom may be off those sectors and
companies that are significantly impacted by a slowdown in China, but we
are happy to find high quality companies that have corrected along with the
market. Short term volatility comes and goes, but offers us the opportunity to
selectively buy high quality investments when they are on sale.

The Fund is well positioned for investors that seek diversification away from
the Canadian economy. Dividends are an important component of total return
- every holding in the portfolio pays a dividend. We seek companies that will
be able to increase dividends on a regular basis. The current yield of the equities held in the portfolio as at September 30 was a healthy 3.5%.

Feature Holding
We established a new position in semiconductor equipment test company KLA
Tencor during the period. KLA had been weakening in price, coincidentally just
ahead of the timeframe of when the company usually increases is dividend rate.
When KLA did announce its dividend increase, it was overshadowed by Intels nextday announcement of delaying some of its capital equipment spend, which would
have the effect of pushing out KLAs near term prospects. Amid all of the noise, KLA
declined to yield an attractive 4% at our entry price.

Portfolio Managers
DON WISHART, CFA
President, Seamark Asset Management (2013) Ltd.
ROBERT MCKIM, CFA
Chief Investment Officer, Seamark Asset Management (2013) Ltd.
GEORGE V. LOUGHERY, CFA
Chief Portfolio Manager, Seamark Asset Management (2013) Ltd.
www.seamark.ca

Portfolio Commentary
During the third quarter, there were few places to hide, as most industries
across the S&P500 reported negative returns with the exception of utilities.
Not surprisingly, the Funds holdings in the materials, energy and industrial
sectors contributed to the Funds negative return. These holdings continued
to be buffeted by worldwide commodity price pressures.
It is quite evident that value stocks in general have substantially underperformed growth, a phenomenon that has persisted throughout this tenuous
economic recovery. Some investors have been willing to pay up for growth,
given its scarcity, but valuations are stretched for growth companies at this
point in the cycle. Value and growth ebb and flow in popularity. As we embark into the fourth quarter we are seeing early signs of value regaining some
favour with investors, which would certainly benefit the Funds holdings.
We are believers in tilting the portfolio toward less volatile selections, as
a means of protecting the NAV of the Fund. One means of delivering on
this approach is to include some worldwide companies that trade on U.S
Exchanges via ADRs. Many such companies offer very attractive yields, and
growth prospects that should provide for a total return that will contribute to
maintaining/growing the NAV. During the quarter we established positions
in shares of Diageo, ABB Ltd, HSBC, Unilever, and Royal Dutch Shell in the
portfolio.
TORONTO
161 Bay Street, Suite 4420, P.O. Box 204
Toronto, ON M5J 2S1
T: 416.777.7350 or 1.877.777.1541
F: 416.777.7362

MONTREAL
1155 Robert-Bourassa Boulevard, Suite 905
Montreal, QC H3B 3A7
T: 514.227.0666 or 1.866.687.9363
F: 514.875.8188

VANCOUVER
1055 West Hastings Street, Suite 300
Vancouver, B.C. V6E 2E9
T: 604.895.7281
F: 604.684.6024

CLIENT SERVICES
T: 416.365.4077 or 1.888.964.3533
F: 416.365.4080
clientservices@marquest.ca
www.marquest.ca