Take Care of The Things You CAN Control, Part 1

Take Care of The Things You CAN Control, Part 1

Investment Fees.  Investment Fees.  Investment Fees.

That seems to be all that people are talking about nowadays. 

I read a lot of newspapers and industry papers.  I now see that one of the regulatory bodies wants full investment costs disclosed to the clients on their statements.  Was this not what was supposed to have come into effect a year or so ago?  I guess they missed something.

As far as fees are concerned, in my humble opinion, they are only part of investment/investor returns.  I use the two words separately because there is a difference between investor returns and investment returns (we will look at this later).  There are many factors that will affect your returns and while many of them are beyond your control, you should be looking at the factors you can control.  This is why fees are always at the forefront.  Fees you can control.

Looking at Canadian Equity Funds from five different mutual fund providers the average MER/TER is 2.37%* and the average five-year return is 5.77%.  Of these five funds, an average seven of their top ten holdings are in the top ten of the TSX.  One fund has five of the top ten, while there are two with eight of the top ten.

Why is this important?

You can control fees.

If you can get the same basket of companies, with a Personal Portfolio Manager who will work with you to create a well-structured investment plan, build appropriate portfolios of low-cost Exchange Traded Funds (ETFs), and continue to manage your investments on a fully discretionary basis, and pay less than a traditional mutual fund, would you?

Where do you buy your mutual funds from?  Who do you buy your mutual funds from?

Are the recommendations you receive based on a strict due diligence process and only benefit you?

Is your investment advisor completely independent from all financial institutions?

Are the investment funds you are invested in completely independent from all financial institutions?

Are you getting value for the extra 1%?

Ask yourself these questions.  If you want to know more feel free to call us at 1-877-242-9116 or send us an email at trevor.wright@wrightassociates.ca and we will set up a time to talk over a coffee (and the coffee is on us!).

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