The disclosures below provide a summary of the key risks and uncertainties that affect CI’s financial performance. For a  more complete discussion of the risk factors which may adversely impact CI’s business, please refer to the “Risk Factors”  section of CI’s Annual Information Form, which is available at www.sedar.com. Market risk is the risk of a financial loss resulting from adverse changes in underlying market factors, such as interest rates, foreign  exchange rates, and equity and commodity prices. A description of each component of market risk is described below: CI’s financial performance is indirectly exposed to market risk. Any decline in financial markets or lack of sustained  growth in such markets may result in a corresponding decline in performance and may adversely affect CI’s assets under  management, management fees and revenues, which would reduce cash flow to CI and ultimately impact CI’s ability to  pay dividends. CI is subject to market risk throughout its Asset Management business segment. The following is a description of how CI  mitigates the impact this risk has on its financial position and operating earnings.  Management of market risk within CI’s assets under management is the responsibility of the Chief Operating Offi cer, with  the assistance of the Chief Compliance Officer. CI has a control environment that ensures risks are reviewed regularly and  that risk controls throughout CI are operating in accordance with regulatory requirements. CI’s compliance group carefully  reviews the exposure to interest rate risk, foreign currency risk and equity risk. When a particular market risk is identifi ed,  portfolio managers of the funds are directed to mitigate the risk by reducing their exposure. At December 31, 2012, approximately 26% of CI’s assets under management were held in fixed-income securities, which  are exposed to interest rate risk. An increase in interest rates causes market prices of fixed-income securities to fall, while  a decrease in interest rates causes market prices to rise. CI estimates that a 50 basis point change in the value of these  securities would cause a change of about $1 million in annual pre-tax earnings in the Asset Management segment.  At December 31, 2012, about 65% of CI’s assets under management were based in Canadian currency, which diminishes the  exposure to foreign exchange risk. However, at the same time, approximately 20% of CI’s assets under management were  based in U.S. currency. Any change in the value of the Canadian dollar relative to U.S. currency will cause fl uctuations  in CI’s assets under management upon which CI’s management fees are calculated. CI estimates that a 10% change in  Canadian/U.S. exchange rates would cause a change of about $16 million in the Asset Management segment’s annual  pre-tax earnings.  MARKET RISK  Asset Management Segment  39 $_{ Interest rate risk is the risk of gain or loss due to the volatility of interest rates.}$ $_{ Foreign exchange rate risk is the risk of gain or loss due to volatility of foreign exchange rates.}$ $_{ Equity risk is the risk of gain or loss due to the changes in prices and volatility of individual equity instruments }$ and equity indexes.