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Explaining Investment Fund Fees

With the arrival of CRM2, advisors may see an increased interest by investors in understanding the costs of their financial products and how those costs compare across products or with the costs in other countries. Of course, there are costs to owning any type of any financial product, be it insurance, a deposit account, securities or an investment fund. For mutual funds, it’s important to know that the costs are fully disclosed and reported as a total amount, usually including the cost of advice, and net of returns, so the investor knows what the real return is and how much s/he is paying. Investors in other countries, such as the U.S., may have to tally up management costs, trading costs and advisor and other hidden costs and then try to calculate their returns.

We offer some tools to help explain costs to investors along with more detailed studies and reports from independent third parties on investment fees.


Your Guide to Investment Funds – Winter 2017

Understand your investments and secure your future.

"It's your money. Find out more." – A Toolkit for Dealers and Advisors

The Investment Funds Institute of Canada has created this toolkit to help advisors engage with clients about the new information investors will receive about the performance of their investments and the fees they paid to their dealer under the initiative known as “CRM2”. The materials in this toolkit were created to encourage investors to open their statements and read the new information.

Advisor Insights: Answering Your Clients’ Questions about Services and Fees

This is part of a special three-part series of Advisor Insights. The series focuses on helping advisors have better conversations with their clients about their investments as the final stages of CRM2 are implemented. The other two bulletins in the series are: Advisor Insights: An Opportunity to Strengthen Your Relationships with Clients and Advisor Insights: Answering Your Clients’ Questions about the Performance of their Investments.

Infographic: Value for Your Mutual Fund Fees

This infographic highlights the services that retail investors receive for the fees that they pay through their purchase of mutual funds.

New Infographic Helps Investors Understand What Services They Receive for Their Mutual Fund Fees

Advisor Insights: The Real Cost of Owning Mutual Funds in Canada and the U.S.

Model Report on Charges and Compensation: CRM2 - 2016 Requirement (June 17, 2016)

The raw template prepared by the regulators has been enhanced with simplified language and easy-to-follow layouts to improve investor understanding. Dealers can meet the requirements of CRM2 by providing separate reports or by integrating the information into their quarterly account statements once per year. The Model Report on Charges and Compensation was reviewed by staff at the Mutual Fund Dealers Association and their comments were incorporated. See IFIC’s guide “Preparing CRM2 Reports for Your Clients” for insights on preparing these reports.

Paying for Advice - Why Options are Important

Canadian Study - Mutual Fund MERs and Cost to Customer in Canada (September 2012)