Financial Planning Assumptions (Market Capitalization Weighted Portfolio)

Introduction

This guide is intended to provide Canadian financial planners with our best estimates of future asset
class returns and volatilities to produce financial projections for their clients. This document assumes
that investors hold a broadly diversified portfolio of publicly traded Canadian fixed-income and global
equity, including developed and emerging markets. These estimates are valid uniquely in the context of
an investor who purposely avoids concentration in one or a few securities or sectors. Our investment
horizon is 30 years. Key inputs are highlighted in green for users of the Naviplan financial planning
software. We also have added an appendix to provide users of Naviplan with data presented in a more
compatible format.

Table of Contents

1. Introduction
2. Q1 2023 Improvements to Methodology
3. Expected Inflation
4. Primary Residence
5. Asset Class Expected Returns
6. Expected Standard Deviations
7. Expected Correlations
8. Composition of Asset Class Returns
9. Portfolio Expected Returns
10. Appendix: Financial Planning Assumptions – Naviplan Input Format

This report was written by the Research team at PWL Capital Inc. The ideas, opinions, and recommendations contained in this document are those of the authors and do not necessarily represent the views of PWL Capital Inc.