Playing it Safe

The mature investor

Less time for markets to work on your behalf

Advisors recommend taking less risks

Principal Protected Notes (PPNs) may be an option

Growth potential of equity markets

Conservative investments not providing enough after-tax return

What are PPNs?

Hybrid investments

Mutual funds, stocks, market indexes

and/or commodities

Bond or GIC

Primary feature

Earn similar rate of return Without risking

principal invested

Term-to-maturity between 5–10 years Some cashable

sooner

Why are PPNs becoming so popular?

Demand

Ability to achieve equity-like market returns

Principal not at risk

Today’s low interest rate environment

GICs, bonds and Treasury bills may only gain 2-3% per annum

PPNs could gain back some of the wealth erosion

Liquidity

Secondary markets exist*

Allow you to redeem PPN before it matures

*Manulife cannot be certain there will be a secondary market for these in the future.

Tax on PPNS

Capital gain or capital loss

Tax incentive to redeem PPN prior to maturity

Gains at maturity treated as interest income

Three reasons why PPNS are popular

1. Low interest rates

2. Aging population

3. Risk-wary investors

Making PPNs part of your financial plan

Take profits

Reinvest profits into a PPN linked to an equity-type investment

Capture recent market returns

Protect capital

Obtain future equity market returns and minimize undue risk

Avoid making untimely market decisions

Alter asset allocation without increasing risk

Substitute for fixed-income investments

Can provide a guarantee of principal at maturity

Can function like guaranteed investments Guard against loss of capital

Boost return potential

Leveraged investing with a safety net

Offer benefits of leverage

Help minimize risk

Incorporate leverage to boost returns

Fully protected against potential losses

PPNs take the emotion out of investment decisions

Speak to your advisor

PPNs not sold on a continuous basis

Formulate a strategy that makes best use of features and benefits of PPNs

Important notes

The commentary in this presentation is for general information only and should not be considered investment or tax service to any party. Individuals should seek the advice of professionals to ensure that any action taken with respect to this information is appropriate to their specific situation.

Manulife Investments is the brand name identifying the personal wealth management lines of business offered by Manulife Financial and its subsidiaries in Canada. As one of Canada’s largest integrated financial services providers, Manulife Investments offers a variety of products and services including: segregated funds, mutual funds, principal protected notes, annuities and guaranteed interest contracts.

Manulife and the block design are registered service marks and trademarks of The Manufacturers Life Insurance Company and are used by it and its affiliates including Manulife Financial Corporation.

PPNs may not be suitable for all investors and are subject to certain risks, which investors should consider before investing. Some conditions apply. Investors should obtain and read a copy of the Information Statement for all applicable fees, and for an explanation of how the return on the Notes will be determined. Commissions, management fees and expenses all may be associated with this investment. The investor's principal is guaranteed at maturity only for Notes purchased at the issue price and held until the Maturity Date.