The Premature Death of Alpha

Harry S. Marmer, CFA,

hmarmer@hillsdaleinv.com
April 2017
This presentation is not to be redistributed in whole or in part without prior written authorization. The information and material in this presentation are for informational purposes only.
They are not intended as investment, financial or other advice. The information in this presentation is not an offer to sell or a solicitation to buy any security nor does it constitute an
offer by Hillsdale Investment Management to provide its investment advisory services in any jurisdiction in which, or to any person to whom, it would not be permitted under applicable law.
Further disclosures can be found at the end of the presentation.
The Premature Death of Alpha

What is Alpha?

Who Are The Culprits in the Death of Alpha?

The Three Fundamental Laws Driving the Active/Passive

Investment Debate

The Perversity of Success in Asset Management

Is Alpha Dead?

2
What Is Alpha?

Difference in Returns Between The Investment Manager and

the Benchmark or Index. Typical Benchmark for Canadian
Equities is the S&P/TSX Total Return Index

Active vs Passive Investment Management Debate,

i.e. Can You Beat The Market?

Alpha is Also Known As:

Value Added
Excess Return

3
Beating the Market Has Become Nearly Impossible

OBITUARIES

Alpha is Dead

4 Source: Institutional Investor, Julie Segal, Oct 27 2013; The Death of Alpha On Wall Street, Scott Appleby, Tabb Forum, December 23, 2013
Who Is To Blame For the Death of Alpha?
Consultants Too Quick to Replace Managers
Investment Committees Weak Governance, Spending Majority of Time
On Non-Governance Matters (i.e. Economy, Performance, etc)
Financial Innovation ETFs Are Commoditizing Alpha
Money Managers Overpromise Performance & Over Simplify Process
Pension Staff Inexperience Leads To Chasing Hot Performing Managers
Private Equity Firms Reduce # of Stocks By Taking Companies Private
Regulators & Accountants Regulation Fair Disclosure
Sell Side (i.e. Brokers) Decline In Quantity/Quality of Research
Traders Electronic Trading Reduces Trade Information Flow
Technology The Internet Information is Immediately Disseminated

Each Participant Knows That It Is Working Conscientiously, Knows

it is Working Hard, and Believes Sincerely In Its Own Innocence.1
Sources: Regulation FD All publicly traded companies must disclose all material info to all clients at the same time, Aug 2000
5 1 Charles Ellis., Murder on the Orient Express: The Mystery of Underperformance., (July/August 2012), Financial Analysts Journal, Vol. 68,
No. 4. pp: 7. See as well Death of Alpha On Wall Street by Scott Appleby, Dec 2013, Tabb Forum.
Is Active Investment Management Dead? Not A New Concept

US Active Managers Confounded7

1 Makan, Ajay, McCrum, Dan and Mackenzie, Michael., Start Stock Pickers Struggle to Beat Index. (Nov 2011). Financial Times. Available Online.
2 AAA Staff., Stock-Picking Alpha in a Life or Death Struggle. (Oct 2010). All About Alpha. Available Online.
3 Bianco Research L.L.C. Why 2011 Was a bad Year for Money Managers. (Jan 2011). [Conference Call Handout]
4 Goodman, Beverly. Meet the New Math, Same as the Old Man. (Mar 2012). Barrons. Available Online.
5 Cooper, Jay., Rogercasey Defends Active Managers. (Sept 2009). FundFire.com. Available Online.
6 Fay, Sharon., Is Active Management Dead?, (Oct 2011). Allinace Bernstein Blog. Available Online.
6 7 Flood, Chris. US Active Managers Confounded by Correlations., (Jan 2012). Financial Times. Available Online.
8 Lauricella, Tom and Zuckerman, Gregory. Macro Forces in Market Confound Stock Pickers. (Sept 2010). The Wall Street Journal. Available Online.
A Quick History Lesson on Efficient Markets and Alpha

1970s: Academics Conclude That Markets Are Efficient Except to

Some Degree in the Strong Form
1980s: Research Finds Anomalies Such as Small Firm Effect,
January Effect, the Low Volatility Anomaly and The Value Effect
1990s To Today: Markets ARE Efficient (Data Mining, Fees, Risk)
Or
Markets are NOT Efficient:
Rise of Passive Management & Quantitative Managers,
Professional vs. Noise Traders, (i.e., Central Banks, Individuals, the
Herd)
Fads, Bubbles, Behavioral Biases, etc
Bounded Market Efficiency

7
Active/Passive Investing Success Varies Over Time

8 Source: Peak Passive: The Coming Active Renaissance, by Joe Mezrich, Nomura Quant Strategy, Jan 5, 2017
Three Fundamental Laws Driving The Active/Passive Debate

Three Fundamental Laws Driving The Active/Passive Investment

Management Debate

1.The Market Is Driven By Different Factors Over Time

2. Arithmetic Of Active Investment Management

3. The Fundamental Law of Active Investment Management

9
The Market Is Driven By Different Factors Over Time
In the Short Term, Many Factors Can Drive Market Returns and
Influence The Success Of Active Management Irrespective Of Skill:

Beta Monetary Policy

Cap Noise
Commodities Politics
Currencies Risk or Volatility
Fiscal Policy Speculative
Fundamentals Style
Interest Rates Etc

10.
 Cap Managers Tend to Outperform When Cap Wins
Russell 2000 TRI - S&P 500 TRI
Quarterly, Mar 1980 Dec 2016
Statistics
1 Year
20% Small Cap Qtrl.
Rolling
40.0%
Mean 0.1% -0.3%
Outperforms Median -0.4% -1.0%
Stdev 5.2% 11.7% 30.0%
15% High 15.1% 41.5%
Low -15.4% -34.7%

1 Year Rolling Excess Return

20.0%
10%
Quarterly Excess Return

10.0%
5%
0.0%
0%
-10.0%

-5%
-20.0%

-10%
Large Cap -30.0%

Outperforms
-15% -40.0%
1980 1983 1986 1989 1992 1995 1998 2001 2004 2007 2010 2013 2016

Quarterly Excess Return 1 Year Rolling Excess Return

11 Sources: See Footnote 1.

 Risk: Active Management Underperforms When High Risk Wins
Rolling 3 Month Return Spread Between High & Low Risk Stocks
Stocks from the S&P/TSX Composite

Jan 1986 Dec 2016

80% 80%
Statistics
Mean -3.5%
60% Median -3.5% 60%
StDev 14.9%
High 62.9%
40% -46.5% 40%
Low

20% 20%

0% 0%

-20% -20%

-40% -40%

-60% -60%
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
Standard Deviation 30 days

Risk is measured as 30 Day Standard Deviation of Returns, Top 30 and bottom 30 stocks,
12 3 Month Rolling Data, Monthly Rebalanced
Sources: See Footnote 1.
 In High Risk Regimes, Stock Correlations Are High and
Stock Dispersion is Low
Russell 1000 120 Day Intra-Portfolio Correlation vs VIX
Monthly, Dec 1986 Dec 2016
IPC VIX
Statistics Statistics
Dec-16
0.7 IPC: 0.18 70.0
Mean 0.28 Mean 20.62
Median 0.26 Median 18.91 VIX: 14.0
0.6 Stdev 0.12 Stdev 7.97 60.0
High 0.66 High 61.41
Low 0.07 Low 9.82
0.5
50.0

Month Ending VIX

6 Month IPC

0.4
40.0
0.3
30.0
0.2

20.0
0.1

0.0 10.0

-0.1 0.0
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
Recession Periods and Bear Markets IPC Average VIX VIX
1- Erb, Claude B., Harvey, Campbell R., and Viskanta, Tadas E., Forecasting International Equity Correlations (November/December 1994), Financial
Analysts Journal, Pages 32 45; Campbell, Rachel, Koedijk, Kees, and Kofman, Paul., Increased Correlation in Bear Markets (January/February 2002). AIMR,
Pages 87-94. Bouchaud; Jean-Philippe, and Potters, Marc., More Stylized Facts of Financial Markets: Leverage Effect and Downside Correlations (2001).
Physica A, Pages 60-70; Pownall, Rachel A.J., Forbes, Catherine S., Koedijk, Kees C. G. and Kofman, Paul, Diversification Meltdown or Just Fat Tails? (June
2006), EFA 2006 Zurich Meetings; Ankrim, Ernest M., and Ding, Zhuaxin., Cross-Sectional Volatility and Return Dispersion (September/October 2002),
AIMR, Pages 67-73;Weigand, Robert A., Gorman, Larry R. and Sapra, Steven G., The Cross-Sectional Dispersion of Stock Returns, Alpha and the Information
13 Ratio (Fall, 2010), Journal of Investing; Bouchey, Paul., Fjelstad, Mary. and Vadlamudi, Hemambara., Measuring Alpha Potential in the Market (2011).
Journal of Investing. Fall 2011, Vol. 2, No. 2: Pages 40-47.
Noise Traders Trade On Noise As If It Were Information

Bounded Market Efficiency?

Incorporates Behavioral Biases
Professional vs. Noise Traders
(i.e., Central Banks, Individuals,
the Herd)
Fads, Bubbles, etc
Positive Feedback Strategies Lead
To Destabilizing Rational Speculation

Adaptive Markets Hypothesis (AMH) is based on an evolutionary approach to economic interactions, which incorporates behavioral biases and argues that markets are not efficient but are driven
by fear and greed. The Degree of Market Efficiency Is Related To Environmental FactorsSuch as the Number of Competitors In the Market, the Magnitude of Profit Opportunities Available etc

Sources: *De Long, J.B., A. Shleifer, L. Summers, and R. Waldmann., Positive Feedback Investment Strategies and Destabilizing Rational Speculation (Jun 1990), Journal of
Finance, pp: 379 395. Lo, Andrew W., The Adaptive Markets Hypothesis: Market Efficiency from an Evolutionary Perspective, (2004), The Journal of Portfolio
14 Management, 30, pp: 15-29.
 .
.
.
.

Noise Less Than 25% Of Major Moves Are Explained

Postwar Movements in S&P Index and Their Causes*
Date
1 Oct 13,2008
2 Oct 28, 2008
3 Oct 15, 2008
4 Dec 01, 2008
5 Sep 29, 2008
6 Oct 09, 2008
7 Nov 20, 2008
8 Mar 23, 2009
9 Aug 8, 2011
10 Nov 13, 2008
Percentage Change News
11.49% Governments throughout the world announce moves to support troubled banks
9.53% Late rally on Wall Street as rebound in stocks defies latest economic news.
Falling retail sales and rising wholesale prices spikes fears of recession and erases Mondays
-8.98% record rally.
Obama reveals national security team. NBER says U.S. entered recession in December 2007.
-8.94% Bernanke warns of weak economic conditions.
-8.25% $700 billion TARP bill rejected by House of Representatives. President Bush disappointed.
Rising fears of global recession purshed Wall Street into freefall. U.S. Treasury may take stakes
-7.27% in major banks.
Another wave of selling roiled Wall Street. Democrats say no to current plan for auto bailout
-7.01% telling industry to come back next month with a detailed plan.
Secretary Geitner makes second attempt at unveiling Obamas Administrations plan to deal with
6.91% the banking crises. Obama wants to expand clean energy effort.
Wall Street had its worst day since the 2008 financial crisis, as fearful investors reacted to the
-6.87% United States losing its coveted AAA credit rating.
6.8% Dow down 300 points on the morning reverses on new investor confidence and ends up 553.

. Fears surfaced
. that if the government takes a bigger stake in major banks, this would be
49 . 2009
Apr 20, -4.48% nationalizing. the banks through their back doors. Citigroup was down big today on this news.
Wall Street rallied Thursday, finding momentum at the end of tough session, on a CNBC report
50 Sep 18, 2008 4.41% that the government is working on a more permanent solution to absorbing bad debt.

Source: What Moves Stock Prices: Another Look, by Bradford Cornell, The Journal of Portfolio Management 2013.39.3:32-38
15
This Law Will Help You Avoid The Performance Trap

The Performance Trap:

Selling This Years Loser Which Becomes Next Years
Winner and Buying Last Years Winner Which Becomes
this Years Loser

16 Source: Perspectives on Institutional Investment Management, by Harry S. Marmer, Rogers Publishing, 2002
Chasing Performance
Law #1 Suggests That It is Very Challenging For Active
Managers To Stay Consistently in First Quartile
Managers in Top Quartile

2008 2009 2010 2011 2012

51 4 2 1 0
1 Year Of Past Performance Has NO
Predictive Power

17 Source: Hillsdale Investment Management, eVestment Alliance. Manager universe is based on eVestments All Canadian Equity Universe.
 Active Investment Management Is Usually Called Into
Question At Precisely The Wrong Time
RBC Dexia Median Canadian Equity Manager vs. S&P/TSX TRI
Yearly, 1990 - 2015
9% 9%
8% 8%
7% 7%
6% 6%
5% 5%
4% 4%
3% 3%
2011
2% 2%
1% 1%
0% 0%
-1% -1%
-2% -2%
-3% -3%
-4% -4%
1993
-5% -5%
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
Calendar Year Value Added 4 Year Annualized

18 * Data Source: SEI and RBC Dexia. As of December 31, 2015.

* Source: In Defense of Active Investment Management, by Chris Thompson, Rogerscasey, September, 2009
2. The Arithmetic of Active Investment Management

Part A.
Market (Index) Return = Passive Portfolios + Active Portfolios

In A Perfect or Efficient Market,

The Average or Median Manager
Will Approximate the Market or Index
Return Before Costs

Source: The Arithmetic of Active Management: Does Fund Size Matter?The Financial Analysts' Journal Vol. 47, No. 1, by William Sharpe,
19 January/February 1991. pp. 7-9. Before Costs The Return On The Average Actively Managed Dollar Will Equal The Return On the Average Passively
Managed Dollar.
In A Perfect World or Efficient Market, The Median
Manager Will Approximate the Index Return Before Costs

US Equities 5 Year Annualized Return Ending Dec 2013

18%

16%
1st Quartile

14%
3rd Quartile Median S&P 500
Manager
12%

10%
US Equity Universe
1st Quartile 15.06
Median 14.29
3rd Quartile 13.71
S&P 500 14.45

20 Source: Mercer Pooled Fund Survey, December 2013.

2. The Arithmetic of Active Investment Management

Part B.
Market Return Passive Portfolios + Active Portfolios

In An Imperfect or Inefficient Market,

The Average or Median Manager Will Not
Approximate the Market or Index Return Before Costs

21 Source Harry Marmer, The Active vs Passive Debate: A Never Ending Debate. Unpublished
How The Arithmetic of Active Investment Management May
Not Add Up

Not All Active Portfolios Are Tracked 1

Skewed Index, i.e. Narrow, Concentrated
Survivorship Bias 1
Active Management Tilts Are Rewarded
Bubbles

22 1 This is discussed in more detail by Manager Selection, by Scott Stewart, Research Foundation of CFA Institute, 2013.
In An Imperfect or Inefficient World, The Median Manager
Will Not Approximate the Market

Canadian Small/SMID Cap Equities 5 Year Annualized Returns Ending Dec 2015
18.0%

15.0%

12.0%
5th Percentile 15.7%
9.0% 1st Quartile 6.9%
Median Median 5.2%
6.0% Manager
3rd Quartile 1.8%
3.0%
95th Percentile -0.2%
S&P/TSX Small Cap -5.7%
0.0%

-3.0% TSX
Small Cap
-6.0%
Cdn Small/SMID Cap

23 Source: Mercer Pooled Fund Survey, December 2015.

3. The Fundamental Law of Active Investment Management
A Managers Value Added (or Alpha or Excess Return)
Adjusted For Risk Is Dependent On:
Skill Breadth

Winning Managers Require Skill and Breadth

Source: The fundamental law of active investment management is discussed in Active Portfolio Management, Chapter 6, by R. Grinold and R. Kahn, McGraw Hill,
24 New York, 2000. For a completely different view of the utility of this law see The Fundamental Law of Active Management Is No Law of Anything by Richard O. Michaud,
David N. Esch, and Robert O. Michaud, Draft, April 2017 2017 New Frontier Advisors
What Is Skill?

Key Characteristics of Successful Investment Managers

Factor
1 Intelligence
2 Knowledge
3 Focus
4 Long-Term Thinking
5 Independent Thinking
6 Alignment of Interests

25 Source: Pg 32 in Manager Selection, by Scott D. Steward. (December 2013), Research Foundation of CFA Institute.
Active Management Is Hard*

*Quote is sourced from The Great Divide Over Market Efficiency, Clifford Asness, John Liew, Institutional Investor, March 2014

26
Where to Search For Alpha (Value Added)
i.e. Beat The Market

In a Market Where There

Are Smart Managers
Who Can Count Cards

27
Smart Managers Who Can Count Cards

Smart Managers Are Skillful

Is The Median Manager Consistently Above The Benchmark?
i.e. Market Is Inefficient

The Greater The Breadth, The More Cards (Opportunities)

A Manager Can Count
This Should be Reflected in the Difference or Spread Between
1st and 3rd Quartile Managers. The Larger (Smaller) This
Spread, The More (Less) Opportunities Managers Have Taken
to Add/Lose Value

28
Counting Cards A Visual

Breadth

Very Little Breadth Plenty of Breadth

25% 25%
15% 15%
5% 5%
-5% -5%

-15% -15%

-25% -25%
Bond Universe Small Cap Universe
Quartile 1 Quartile 2 Quartile 1 Quartile 2
Quartile 4 Quartile 3 Quartile 4 Quartile 3

29 Source: Hillsdale Investment Management

Is Alpha Dead? No! But It Depends On Where You Look
Asset Class Breadth Skill Odds of Success
Cdn. Fixed
Low Low Low
Income
Cdn. Large
Low Avg. Avg.
Cap Equity

Cdn. Small Cap High High Higher

U.S. Large Cap
High Avg. Avg.
Equity

U.S. Small Cap High High Higher

Global Equity Avg High High

Global Small Cap High High Higher

30 Source: Harry Marmer, pg 60, in Perspectives On Institutional Investing, Rogers Publishing, 2002
The Perversity of Success in Asset Management - Success
Can Lead to Mediocrity

Value
Added

0
Assets Under Management

Sources: Perspectives in Institutional Investment Management, by Harry Marmer, Rogers Publishing, 2002, page 61, Asset Growth and Its Impact on
Expected Alpha, by R.Kahn, in Global Perspectives on Investment Management, CFA Institute, 2006, pages 197 212, The Right Amount of Assets
Under Management, by A. Perold and R. Salomon Jr. FAJ, May-June 1991, 31 - 39 and Optimal Asset Allocation and Risk Shifting in Money
31 Management, by S. Basak, A. Pavola and A. Shapiro, The Review of Financial Studies, 2007, page 1583- 1621
Why Can Alpha Shrink Over Time?
1. Active Bets Diminish Over Time
2. Skills Are No Longer Skills
3. Increase in AUM
i. Transaction Costs Creep Up
ii. # of Securities Increase
ii. Hire More Professionals Increase in Securities
iii. Higher Administrative Stress
iv. Deviation from Style
4. Lifecycle of A Business, i.e. Business Decisions
No Skill
Protective Mode, i.e. Guardian Mentality
Sources: Mutual Fund Performance: Does Fund Size Matter? Financial Analyst Journal, by Daniel C. Indro, Christine X. Jiang, Michael Y. Hu and
32 Wyne Y. Lee, May 1999, The Evolution of Investment Processes, by Paul Greenwood, Russell Research Commentary, June 1999.
 As AUM Increases, More Professionals Are Hired, More
Administrative Care Is Required

Number of CFA Charter Holders vs. Number of Stocks & Mutual Funds
180,000

160,000
Exponential
Growth
140,000

120,000

100,000

80,000

60,000

40,000

20,000

0
1975 1977 1979 1981 1983 1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013

Listed Companies Mutual Funds CFA Charter Holders

33 Source of Data: CFA Institute, World Federation of Exchange

The Perversity of Success Can Be Mitigated To Some Degree
Through the Use of Incentive Based Fees

Incentive Fees Are Supposed to Attract Managers Who Are

More Skilled or Will Exert More Effort Than Those Who Are
Attracted to Funds Without Incentive Fees.

In Fact, Funds With Incentive Fees Exhibit Better Stock

Selection Ability Than Funds Without Incentive Fees. Funds
With Incentive Fees Also Have Lower Expense Ratios Than
Funds Without Incentive Fees.

Thus the Fund Holder Benefits From Two Influences:

(1) Better Stock Picking Ability and (2) Lower Expenses.

Source: Elton, Edwin J., Martin J. Gruber, and Christopher R. Blake. Incentive Fees and Mutual Funds, April 2003, The Journal of Finance. Vol. LVIII,
34 No. 2, Page 802.
Key Takeaways
Alpha (Value Added) Is Not Dead

Any Assessment Of The Success of Active Management Should Always Consider:

The Factors Driving Stock Returns
The Benchmark Representing the Investment Opportunity Set
The Odds of Beating The Market

Both Active and Passive Investment Management Success Is Cyclical i.e. Go In

And Out Of Favor Over Time

The Dynamics Of Winning In Active Investment Management Vary Over Time.

These Variabilities Reflect Both The Complexity and Dynamics Of The Market

Significant Value Added Can Be Gained In Select Asset Classes But Success Will
Depend on Manager Breadth, Skill and the Market

To Temper the Quest for Mediocrity Clients Can Align Their Managers with Well
Designed Incentive Based Fees
35 Source: Empirical Evidence Indicates a Positive Correlation Between the Inclusion of Performance Based Fees and Higher Alphas page 69 in Manager
Selection by Scott Stewart, Research Foundation of the CFA Institute, 2013.
Appendix

36
Institutional Managers Outperform
Using a dataset of $17 trillion of assets under management, we document
that actively managed institutional accounts outperformed strategy
benchmarks by 86 (42) basis points gross (net) during 20002012. In
return, asset managers collected $162 billion in fees per year for managing
29% of world capital.
We trace this outperformance to systematic deviations from the asset-class
benchmarks. The asset manager industry is therefore not just a passive
pass-through entity

Source: Institutional Performance and Smart Betas by J. Gerakos Juhani ,T. Linnainmaa, & A. Morse, November 28, 2016
We Find That the Average Mutual Fund Has Used This
Skill to Generate About $3.2 Million Per Year.
The total value the manager extracts from markets is equal to the amount of
money the fund charges in fees, minus any money it takes from investors: the
percentage fee multiplied by AUM plus the product of the return to investors in
excess of the benchmark and AUM. This quantity is the funds gross excess
return over its benchmark multiplied by assets under management, what we
term the value added of the fund.
Investors appear to be able to identify talent and compensate it: current
compensation predicts future performance.
Not only do better funds collect higher aggregate fees, but current aggregate
fees are a better predictor of future value added than past value added
To measure skill we take the product of the funds abnormal return (the return
before fees minus the benchmark return) and assets under management (AUM)

Source: Measuring Skill in the Mutual Fund Industry, by Jonathan Berk and J. van Binsbergen, Journal of Financial Economics, 2015, vol. 118, issue 1,
pages 1-20

44
Footnotes and References

Footnote 1

All data presented is from Hillsdales proprietary database unless indicated otherwise. This database consolidates
information from multiple vendors to support Hillsdales research, portfolio management and reporting activities.
All performance data shown in this presentation is gross of fees unless otherwise indicated.

Footnote 2

Performance and other data in this presentation are shown for illustrative purposes only. Backtested returns are
based on a quantitative testing where stocks are selected based on Hillsdales proprietary stock selection systems.
All Backtest returns are shown gross of fees and are calculated in Canadian or US dollars as indicated. No
representations are being made that the investment process will achieve similar returns on a going forward basis.
Investors should not consider the data included in the presentation as an indication, assurance, estimate or forecast
of future results. Actual returns may differ materially from the returns shown for reasons including, but not limited
to, investment restrictions and guidelines, fees and other expenses, cash holdings, timing of trade execution and
fluctuations in the market.

Footnote 3

Russell Investment Group is the source and owner of the trademarks, service marks and copyrights related to the
Russell Indexes. Russell is a trademark of Russell Investment Group.

39
Harry S. Marmer
Harry S. Marmer, BBA, MBA, CFA, Partner. Prior to joining Hillsdale in 2008, Mr.
Marmer led the Canadian institutional business of Franklin Templeton Investments and
before that the institutional business at Russell Investment Group. He was also a
principal and co-leader of Mercer's Canadian Investment Consulting Practice. Before
this he was a Senior Investment Analyst at Sun Life Canada. Mr. Marmer is a frequent
conference speaker and has authored more than 47 articles and a book entitled,
"Perspectives in Investment Management." Currently, he continues to volunteer for the
CFA Institute and is a member of the Investment Committee of the Canadian Friends
of Hebrew University. Mr Marmer has served on a number of industry boards and was
past president of the Toronto CFA Society. He was awarded the Toronto CFA Societys
Research Award and received the Societys Volunteer of Distinction Award

40