When you purchase a mutual fund you are required to receive a simplified prospectus no later than two days after making the purchase decision although you would normally expect to receive this document BEFORE making that decision. However, many investors rely on a financial advisor for recommendations and quite frankly couldn’t be bothered to read [...]
Options Licensed Advisors Are Rare
How many financial advisors are in Canada? To give you a rough idea as to the number of financial advisors in Canada as a whole, there are about 75,000 MFDA advisors (mutual fund sales reps), 125,000 Life-Licensed advisors (insurance agents) and 25,000 IIROC advisors (licensed to sell individual stocks). Those are rough numbers for a [...]
New ETNs Allow Investors to Profit on Market Volatility… or not
UPDATE: THIS WAS AN APRIL FOOLS PRANK! Gotcha! Many writers and experts have commented on the proliferation of bad ETFs as manufacturers cash in on the caché of the ETF name. We’ve seen leveraged ETFs, niche sector ETFs, and alternative strategy ETFs pop up and uninformed investors flock to them still. (For the record, I [...]
Is Your Brokerage's Bond Desk a Profit Centre?
Not a question a lot of people ask, but it’s an important one. As an investor, if you buy a bond from your advisor or discount broker you see the price you are offered, but how far off is that from the price the brokerage paid to get it for you? Bond desks can either [...]
Buying ADRs to Avoid Stamp Duty
Coincidentally, I was talking to the portfolio manager of our index funds today and part of the conversation was surrounding tracking error and the use of ADRs and GDRs. In a post from last week I had mentioned how using ADRs and GDRs could be a source of tracking error, but there is more to [...]
New Canadian Small Cap ETF Available
IndexIQ has launched a new ETF which attempts to give investors exposure to small cap Canadian stocks, but as a Canadian you will probably want to avoid this particular ETF for now. It trades with the ticker symbol CNDA. 1. The ETF is listed in the US While you won’t have to monitor the currency [...]
Index Fund Tracking Error Sources
NOTE: I’m scrambling to write this before I get on a plane and my laptop battery is near death, so pardon any typos for the time being – I’ll edit it tomorrow, and may even re-write it! It’s good to be my own editor…. :) Not all index funds are created equal. Some actually track [...]
TER: The Trading Expense Ratio or Total Expense Ratio?
By now, most people have heard of the MER (Management Expense Ratio) in mutual funds and ETFs. Another term that gets bandied about is the TER, which is less well known and has a few different meanings depending on which country you are in. Meaning 1: TER = Trading Expense Ratio (Canada) When you look [...]
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