Mutual Funds Disclaimer - Mutual Fund - Funds Disclaimer

Sign-up for the FREE Mutual Funds Newsletter, sponsored by

Latest Mutual Fund Articles

#trilliondollarfunds. The Canadian Mutual Fund Industry is worth more than $1 Trillion. What’s your share? Get a Free Portfolio Reviiew
Sponsored by: || || || ||

Latest Mutual Fund Articles

Mutual Funds Disclaimer


Professional Money
Management Highly qualified financial professionals manage mutual funds and investment funds. These investment managers invest funds on a continuing basis based on traditional money management and asset allocation in a particular area or discipline.

Spreading investments across a number of asset classes (stocks, bonds, and money market instruments) or between 6 to 10 or more different securities (stocks) in 3 or 4 different industries. Mutual Funds allow small investors a low-cost way of creating a reasonably and diversified portfolio. In fact, it is difficult for a small individual investor to purchase some stocks and mutual funds that allow a lower entry fee and accessible fund prices. Without diversification many small mutual fund investors would find all their investments in the same basket.

Under the right to redemption, mutual fund unit shareholders have the right to redeem fund shares for cash or transfer at anytime at their current net asset value. Rules and regulations stipulate that payment must be made within five business days from the date of request for the net asset value; however, most fund companies strive to make the payment made sooner.

Variety of Funds
Today's the mutual fund market is worth over 700 billion dollars proving the industry is quite mature and robust. There are a multitude of different funds, from highly diversified globally balanced funds to specialized small-cap Internet funds. The menu is continually expanding and it seems the fund market is determined to satisfy at least a portion of the appetite of a majority of Canadian investors.

Ease of Purchase
Most funds offer a variety of purchase plans including one-time, lump sum, and regular interval structures (ex. once per month). Dollar Cost Averaging is a form of regular investing and one of many strategies available in portfolio creation and wealth management.

Special Options
Many funds offer to reinvest dividends paid into new units of the fund. In addition, a great number of Canadian mutual funds are fully eligible for investment under an RRSP and as such, can provide excellent tax deferral over time.

Transferability Options
Many "mutual fund companies" allow mutual fund investors to transfer in and out or between their family of funds at little or no additional fee. These services makes it easy for investors to switch out of one under performing category, sector or class to a growth sector or practice a "asset allocation" of their own.

Loan Collateral and Leveraging
Often, financial institutions will accept a variety of mutual funds as security for a loan. Leveraging, when an investor borrows funds to invest the advisor and investor must acknowledge this in principal and in writing.

Eligible for Margin
Fund shares or units are eligible for margin and thus, aggressive investors can use leverage to create potentially higher returns. However, as in any leveraged situation investors also face higher risks.


Mutual Funds are not Guaranteed and past performance may not be repeated
Although most fund managers may be highly qualified; portfolio management has never been an exact science. Like most of us, fund managers are human and can be led astray by market fads and crowd psychology. In fact, a track record consistently ahead of the market is very difficult to obtain. This may explain why, in recent years, we have seen only 20% (approximately) of Canada's fund managers beat the TSE 300 market index (the benchmark for Canadian Equity Funds).

Short-Term Investment and Consideration
Because most mutual funds are constructed with a long-term focus, it stands to reason that they should not make good short-term investments. This is especially true in the case of equity mutual funds, which can show relatively large price fluctuations over the near term. Indeed, because load funds charge either a "get in" or "get out" fee at the time of investment, a short-term approach would not be prudent. Having said this, in the specific case of money market funds, a short-term horizon is acceptable. In fact, money market funds were created with a short-term time frame in mind.


FREE Mutual Funds Newsletter

First Name:   
Last Name:  
  Mutual Funds Newsletter - 2016

The Mutual Fund Guide

Get the free Mutual Fund Guide. Subscribe now!

Contact Us

MONEY® Canada Limited
Markham, ON
P: 1-800-789-1011