SEGREGATED FUNDS

Get Segregated Funds with low fees, high performance and suited to your needs.


Segregated Funds are a combination of mutual funds and insurance. Like mutual funds, segregated funds invest in risky assets such as stocks and high yield bonds. Plus, a segregated fund also guarantees a certain amount of its principal to its investors based on the plans.


Thanks to these two features, segregated funds appear to offer higher returns with limited risk. Theoretically, investors in segregated funds can enjoy high returns if the risky assets invested by the segregated funds perform well. If the assets don’t perform well, investors can at least count on getting most of their initial investment (i.e. the principal) back.


Segregated funds work in a way similar to mutual funds. Generally, there are various types of funds adapted to your ability to tolerate risk and to your financial goals (balanced funds, Canadian equity funds, etc.). Your investments will fluctuate based on the market value of the securities that make up the funds.


Cautions

  • In general, the investment can be redeemed at any time.
  • However, if you redeem your funds before the maturity date, you may lose the guarantee.
  • Additional fees may apply when you sell your investment.
  • Segregated fund guarantees are not free of charge – you need to understand the fees and how much you are paying for your investments.
  • Compared with equivalent mutual fund investments, segregated funds usually have higher fees. This difference is due to the cost of the death and maturity benefits.


Important

  • Make sure that the person who sells you segregated fund is aware that you need to buy it for your needs such as bypass probate fees, part of state, retirement and investment plans.
  • Make sure if you are buying the right type of structure, so that when you decided to redeem the funds you are aware how much fees are involved. For instance, if you purchase the DSC type of funds (Deferred Sales Charge) you will have to pay 7% of the fund value as penalty to redeem your funds. Therefore, understand what your fees are and etc.
  • If you need an assistance to review your funds, we can help you.



Contact our Qualified LifePlan Consultant or Financial Planner Today.


Our qualified consultants will take the time to review your current investment account and see if your investments holding have the right asset allocation and are managed according to your risk tolerance.