# Mawer Launches New Fund



## newfoundlander61 (Feb 6, 2011)

http://www.mawer.com/our-funds/fund-profiles/mawer-emerging-markets-equity-fund-profile/

Mawer Emerging Markets Equity Fund


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## dubmac (Jan 9, 2011)

MER is surprisingly high 1.6%!


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## Nelley (Aug 14, 2016)

dubmac said:


> MER is surprisingly high 1.6%!


If you are hoping for 7% return from these grifters they are charging you 1.6/7 or 22.8% a year for the honour of giving them your money.


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## mordko (Jan 23, 2016)

MER includes various trading costs. They are not charging you 1.6 percent, but the cost is 1.6 percent. Running an active EM fund is more difficult and expensive than running something in N America. 

Not that I am advocating this fund but by Canadian standards it's not expensive for EM.


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## dubmac (Jan 9, 2011)

I'm hesitant to describe Mawer as a grifter - 
true the company is in the business to make $, but for the most part their funds are more reasonable than most. Their Balanced fund costs less that 1% MER - which is close to some expensive ETF's. 
I can't think of any US, Int'l or emerging Market Funds that charge less than 1.5%. I know that Mawer has it's research advisers posted in many different countries, it is likely that the fee is designed to support these teams - (as well as make a profit)


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## Nelley (Aug 14, 2016)

mordko said:


> MER includes various trading costs. They are not charging you 1.6 percent, but the cost is 1.6 percent. Running an active EM fund is more difficult and expensive than running something in N America.
> 
> Not that I am advocating this fund but by Canadian standards it's not expensive for EM.


If you are being charged 1.6% the cost to you is 1.6% divided by your expected return. Slowly the sheep are starting to realize that even a fee like this is huge.


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## Nelley (Aug 14, 2016)

dubmac said:


> I'm hesitant to describe Mawer as a grifter -
> true the company is in the business to make $, but for the most part their funds are more reasonable than most. Their Balanced fund costs less that 1% MER - which is close to some expensive ETF's.
> I can't think of any US, Int'l or emerging Market Funds that charge less than 1.5%. I know that Mawer has it's research advisers posted in many different countries, it is likely that the fee is designed to support these teams - (as well as make a profit)


I understand these guys have expenses-but to you that should be irrelevant-the bottom line is over the long term are you confident they are going to get you more than 1.6% every year, year in year out, then you will get yourself.


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## Beaver101 (Nov 14, 2011)

^ Isn't "emerging" markets the next "in" thing, like being on the ground-floor?


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## OnlyMyOpinion (Sep 1, 2013)

Nelley said:


> If you are hoping for 7% return from these grifters they are charging you 1.6/7 or 22.8% a year for the honour of giving them your money.


Grifters. That's great nelley. After 1,307 posts, I haven't seen any comments, much less advice, that belong on a money forum. So I'll take this one for what its worth.


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## OnlyMyOpinion (Sep 1, 2013)

Nelley said:


> If you are being charged 1.6% the cost to you is 1.6% divided by your expected return. Slowly the sheep are starting to realize that even a fee like this is huge.


Not baaaad nelley. A math lesson, that's almost a money forum type post. We won't ask how your relationship with sheep enters into it.


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## Nelley (Aug 14, 2016)

OnlyMyOpinion said:


> Not baaaad nelley. A math lesson, that's almost a money forum type post. We won't ask how your relationship with sheep enters into it.


Try not to obsess about me so much pervo.


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## humble_pie (Jun 7, 2009)

mordko said:


> MER includes various trading costs.



MERs almost never include trading costs such as commissiions for buying & selling the actual holdings of a fund. These are known as TERs. These amounts are not conspicuously set forth in fund literature, although they should be. Normally one finds TERs buried in the footnotes to audited financial statements.

TER costs are included in the aggregate cost of securities purchased during the period of a financial statement. They have also been deducted from the aggregate proceeds from disposition of securities during such a period. So far, regulations do not require that these amounts be set forth independently.

however, actual the ratio of TER costs from the footnotes should be added to MERs in order to arrive at a more accurate picture of a fund's total cost.

.


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## mordko (Jan 23, 2016)

OnlyMyOpinion said:


> Not baaaad nelley. A math lesson, that's almost a money forum type post. We won't ask how your relationship with sheep enters into it.


 the man definitely has a thing about sheep. Big time.


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## mordko (Jan 23, 2016)

humble_pie said:


> MERs almost never include trading costs such as commissiions for buying & selling the actual holdings of a fund. These are known as TERs. These amounts are not conspicuously set forth in fund literature, although they should be. Normally one finds TERs buried in the footnotes to audited financial statements.
> 
> TER costs are included in the aggregate cost of securities purchased during the period of a financial statement. They have also been deducted from the aggregate proceeds from disposition of securities during such a period. So far, regulations do not require that these amounts be set forth independently.
> 
> ...


MER includes management fee, operating expenses and taxes = various trading costs, as well as the fee. The point was that MER does not equal profit pocketed by the fund operator. And that these non-fee costs are higher for an EM fund.


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## GreatLaker (Mar 23, 2014)

Mawer's TERs are posted on the main web page for each fund, in a line after MER. Most of them are well under 0.1%. TER for this fund is not listed, probably because it is new.


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## humble_pie (Jun 7, 2009)

mordko said:


> MER includes management fee, operating expenses and taxes = various trading costs, as well as the fee.



most folks will consider "trading costs" to mean the commissions paid to buy & sell the securities and/or derivatives that comprise the actual holdings of a fund. These commission costs are not included in MERs.

.


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## mordko (Jan 23, 2016)

Commission costs for "buy and hold" funds like those run by Mawer are not going to change a thing - see GL post above.


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## Eder (Feb 16, 2011)

Nelley said:


> If you are hoping for 7% return from these grifters they are charging you 1.6/7 or 22.8% a year for the honour of giving them your money.


They have a pretty good long term record for beating their benchmarks (after MER etc)...check out their performance & get back to me...(I own some Mawer)

These guys are the only MF operators that have a clue...


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## humble_pie (Jun 7, 2009)

mordko said:


> Commission costs for "buy and hold" funds like those run by Mawer are not going to change a thing - see GL post above.



i was commenting on inaccurate lumping together of trading costs as part of MERs in post No 4 above. 



> MER includes various trading costs.


the honourable member was talking about MERs & trading costs in general. Everyone knows that "trading costs" are commission costs, which are not included. In the context, the statement was a bit misleading.

.


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## dubmac (Jan 9, 2011)

Eder said:


> These guys are the only MF operators that have a clue...


...I agree. Last year they have a tougher year than the previous 5-7 yrs. I hold Mawer, and will continue to. They have many awards that have been earned, and their MAW104 balanced fund is a darling among some of the financial critics and talking heads.


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## humble_pie (Jun 7, 2009)

dubmac said:


> ...I agree. Last year they have a tougher year than the previous 5-7 yrs. I hold Mawer, and will continue to. They have many awards that have been earned, and their MAW104 balanced fund is a darling among some of the financial critics and talking heads.



i don't hold mawer but they are a respected bell-wether. Their balanced outperfomed until recently because of their well-known avoidance of the troubled energy sector.

recently jas4 posted that mawer balanced had underperformed the TSX 300 over the past year. That - i thought - must be due to the big bounce off the bottom of the trough which benefited broad index toronto, while an energy-poor fund like mawer would have remained outside the bounce.

longer term, a policy that is still shy on energy might indeed turn out to be a decade winner! 

.


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## GreatLaker (Mar 23, 2014)

Eder said:


> They have a pretty good long term record for beating their benchmarks (after MER etc)...check out their performance & get back to me...(I own some Mawer)
> 
> These guys are the only MF operators that have a clue...


Their record of beating their benchmarks is good on Canadian and International equities. But on US equities and bonds they have trailed their own benchmarks. The more efficient the market (bonds and S&P500) the more difficult it is to beat the benchmark and the more significant the MER is. Based on that they should have a fighting chance with their Emerging Markets fund.

Steadyhand does not offer a pure US equity fund or a pure bond fund. Instead they have an equity fund that is focused on North America with 60% Canada, 30% US and 10% global, and a separate Global Equity fund. For fixed income they have an Income fund that mixes bonds with dividend stocks and REITs. IMO Steadyhand performance is OK, but not outstanding, and trails my own indexed portfolio.

I find that to be quite illustrative, reinforcing the strategy that investors should focus on low cost in very efficient markets.

I do own some Maw105 for my mad money.


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## mordko (Jan 23, 2016)

What I do like about MAW is how they stop accepting contributions once a fund reaches certain size. That shows integrity, although there has to be an element of marketing there too. And their costs compare favourably to the racket offered by the big five. Either way, it benefits investors. 

Still, I don't hold any MAW funds as this wouldn't align with my investment policy.


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## latebuyer (Nov 15, 2015)

Just a note that if you hold mawer international equity it already holds 15% emerging markets. I was surprised this was the case and obviously didn't do my homework before buying it.


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## GreatLaker (Mar 23, 2014)

latebuyer said:


> Just a note that if you hold mawer international equity it already holds 15% emerging markets. I was surprised this was the case and obviously didn't do my homework before buying it.


Depends when you bought. The fund's benchmark was changed late last year to add emerging markets.
See this link: http://www.mawer.com/our-funds/fund-profiles/international-equity-fund/



> ** Mawer International Equity Benchmark History:
> Jan 1988: MSCI EAFE (net)
> Oct 2016: MSCI ACWI ex-USA (net)
> 
> Rationale for Change: MSCI ACWI (net) excluding US Index is a better representation of the mandate in our opinion. For example, the past benchmark does not include Emerging Markets whereas the fund has holdings in these markets consistent with its prospectus and investment policy statement.


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## dubmac (Jan 9, 2011)

good to know..I hold some MAWER Int'l fund to supply diversification. I didn't know about that 15% was EM Fund


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## james4beach (Nov 15, 2012)

humble_pie said:


> recently jas4 posted that mawer balanced had underperformed the TSX 300 over the past year. That - i thought - must be due to the big bounce off the bottom of the trough which benefited broad index toronto, while an energy-poor fund like mawer would have remained outside the bounce.


Initially I failed to consider that Mawer Balanced is a global fund and very low on Canadian exposure. I made a second comparison using a more representative benchmark (44% XAW, 16% XIC, 40% XBB) in this post

Mawer Balanced still came shy of that international benchmark, but not by too much. I wouldn't hold this against them.


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## OnlyMyOpinion (Sep 1, 2013)

Dubmac, not sure if you are thinking the Int fund held 15% in MAW160 or some other emerging mkts fund but that is not the case. The positions were held as individual companies, and MAW160 is a new fund as OP noted.
I wouldn't be surprised though to see funds like 102, 104, begin to use MAW160 for their emerging mkt coverage.

James, MAW104 of course has its own benchark which is: 5% FTSE TMX 91 Day T-Bill Index, 5% Citi World Government Bond Index, 30% FTSE TMX Canada Universe Bond Index, 15% S&P/TSX Composite Index, 15% S&P 500 Index (CAD), 15% MSCI EAFE Index (Net, CAD), 7.5% BMO Small Cap Index (Blended, Weighted) and 7.5% Russell Global Small Cap Index (Gross, CAD) . They acknowledge that they don't try to replicate the holdings of this benchmark, and that they underperformed it last year at 3.2% vs 7.4%. 

The Q4/2016 discussion of results is worth reading. Forex is noted as a significant headwind, and as you noted, their underwieghting in Canada and in cyclicals hurt results last year as well. http://www.mawer.com/assets/Newsletters/2016/2016-Q4-Newsletter-NET.pdf

Disclosure - I own MAW104


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## dubmac (Jan 9, 2011)

thanks...I didn't know this either - but it makes sense & is consistent with what I have seen when I check their holdings in each equity fund - which I do periodically. I have never seen their equity funds hold other funds or ETF's - only companies and some cash


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## Spidey (May 11, 2009)

If the Mawer International Equity Fund or Mawer Global Small Cap Fund are any indication, they both handily beat their respective indexes over almost all time periods with lower betas. Mawer International Equity has a 5 year return of *13.21%* and a 10 year return of *4.42%* versus *13.08%* and *2.67%* for the index.

Mawer Global Small Cap has a 5 year return of *22.3%* (no 10 year available) versus *11.97%* for the index. 

I still own the indexes as well but there could be an argument that good mutual funds can add value - particular in the small cap and emerging market categories.


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## Lenticular (Mar 18, 2017)

*Mawer Emerging Market Fund MAW160*

I am trying to invest in this fund through a TD direct account. I am not able to access in this fund...but all the other Mawer funds are available through them. Anyone encountering this?


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## Lenticular (Mar 18, 2017)

Nelley said:


> If you are hoping for 7% return from these grifters they are charging you 1.6/7 or 22.8% a year for the honour of giving them your money.


Actually this is a very reasonable MER for an emerging market fund. Investors should do very well with this fund as Mawer follows a very strict investing discipline . I invested in their Global Small Cap fund as soon as it was available and have done very well with it.


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## Lenticular (Mar 18, 2017)

I have a self directed account through TD and have not been able to buy this fund. I called up TD and the representative said it was not available...which seems odd since all the other Mawer funds are available. Anyone else encountering this with TD?


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## canew90 (Jul 13, 2016)

As I have not invested in any International , asian or Emerging markets since I dumped a Financial Advisor who had us in those funds, which never made money, I may not be one to comment. But I'd say stick to Cdn & US. At least one knows what one is buying.


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## jargey3000 (Jan 25, 2011)

Beaver101 said:


> ^ Isn't "emerging" markets the next "in" thing, like being on the ground-floor?


yes beav'!...an' i'm going ALL IN on this one...ta hell with it!


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## caltran (Mar 16, 2017)

Lenticular said:


> Actually this is a very reasonable MER for an emerging market fund. Investors should do very well with this fund as Mawer follows a very strict investing discipline . I invested in their Global Small Cap fund as soon as it was available and have done very well with it.


Is it just me or is there no ETF that tracks the Global Small Cap's benchmark index?


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## My Own Advisor (Sep 24, 2012)

dubmac said:


> MER is surprisingly high 1.6%!


Yuck. That's a "no" for me


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## caltran (Mar 16, 2017)

Looks like ZEM tracks MAW160's benchmark index (MSCI Emerging Markets Index).


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## Lenticular (Mar 18, 2017)

caltran..I would bet that MAW160..even with its MER of 1.6..will outperform ZEM by several percentage points. Don't believe me? Then just monitor the fund for the next 5 years and watch MAWER's investing strategy at work.


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## caltran (Mar 16, 2017)

Lenticular said:


> caltran..I would bet that MAW160..even with its MER of 1.6..will outperform ZEM by several percentage points. Don't believe me? Then just monitor the fund for the next 5 years and watch MAWER's investing strategy at work.


It wouldn't surprise me at all. Only developed very large markets are efficient. Everything else is a crapshoot.

Unless somebody wants to say that the TSXV is efficient.


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## james4beach (Nov 15, 2012)

There are some good mutual funds out there, and they can perform well even with high MERs.

One example that comes to mind is Beutel Goodman Small Cap (1.49% MER). Its 5 year performance is 9.68% per year. Compare that to the low fee index ETF, iShares XCS, which only returned 2.31%. No contest! I bring up this example because Canadian small caps are another specialized area where a good manager adds value.

Straying off topic, but the 15 year performance of Beutel Goodman Small Cap is a whopping 10.23% per year. The only thing that repelled me from this fund was the front end load (or is it another load)? Those confuse the heck out of me. It might still be worth holding despite that.


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## caltran (Mar 16, 2017)

So did more digging, is there an ETF that tracks the Citi World Government Bond Index. This seems to be the curative for dropping stock markets - it made almost 40% in 2008!


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## mordko (Jan 23, 2016)

Yeah, Beutel Small Cap caught my eye too. I am buying it through work at 0.4% MER and no loading. I'd like to have 20 to 30% of Canadian allocation in small caps and this is one case when I prefer a mutual fund to a tracker. Of course past overperformance might not extend into the future.


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## james4beach (Nov 15, 2012)

mordko said:


> Yeah, Beutel Small Cap caught my eye too. I am buying it through work at 0.4% MER and no loading. I'd like to have 20 to 30% of Canadian allocation in small caps and this is one case when I prefer a mutual fund to a tracker. Of course past overperformance might not extend into the future.


Interesting. Is that a special arrangement through your work? I am interested in buying this through TDDI or Scotia iTrade ... any idea how that would work? It seems that the MER would be higher, at 1.49%, and I can't figure out the story with the loads. It sounds like any time I add new money into the fund, there would be a fee taken off that (front load).

Pretty hard to ignore a fund that works in a specialized space like this, with 13.3% annual return since inception in 1995. This is significantly higher than the Canadian index. Could the fund managers really be _this_ good? 22 year history can't be an anomaly.


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## mordko (Jan 23, 2016)

Yes, it's a registered pension plan through work. Large companies set up deals with various funds and negotiate lower MERs. The selection isn't all that great but Beutel small cap was something I fancied anyway. 

I can see that a good manager can add a lot of value to a Canadian small cap fund. It's a bit of a sandpit... The usual problem with mutual funds is that eventually the brains behind success leave or the fund grows too popular and large to add any alpha.


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## caltran (Mar 16, 2017)

Yeah I was checking out my wife's DC pension at her work and her total MER is 0.38%. Also it's done really well.


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## Eclectic12 (Oct 20, 2010)

james4beach said:


> ... It seems that the MER would be higher, at 1.49%, and I can't figure out the story with the loads. It sounds like any time I add new money into the fund, there would be a fee taken off that (front load).


You mean you haven't figured out what the front load fee is, right?

As I understand it, the front load fee is a sales charge for the selling agent that is deducted from each purchase then the MER is taken out of the performance.


> Front-end load or initial sales charge (ISC) – Some mutual funds charge a fee when you buy your units or shares. This is a percentage (up to 5%) of the amount that you are investing in the fund. The fee is paid to the investment firm that sells you the fund. You can negotiate this fee with your advisor.


http://www.getsmarteraboutmoney.ca/...unds/Pages/Mutual-fund-fees.aspx#.WNFJ2aIpBaQ
http://business.financialpost.com/i...ves-to-deferred-sales-charges?__lsa=c3d3-44af


This fund, so far is the only one that appears to potentially be worth figuring out the front end charges/possibly buying.


Cheers


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## GreatLaker (Mar 23, 2014)

When I look at my account in TDDI it shows Beutel Goodman Small Cap as no load.

It may be worth calling them to check though. I know TDDI sells Mawer as no load, but I recall the minimum to buy was $5k and also they had a short-term redemption fee. BG funds may have something similar.


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## caltran (Mar 16, 2017)

How about HKB505? Its subadvisor is Mawer. Seems to track well against MAW107 (New Canada - it's been closed for years now).


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## Lenticular (Mar 18, 2017)

GreatLaker said:


> When I look at my account in TDDI it shows Beutel Goodman Small Cap as no load.
> 
> It may be worth calling them to check though. I know TDDI sells Mawer as no load, but I recall the minimum to buy was $5k and also they had a short-term redemption fee. BG funds may have something similar.


Great Laker: I have an TTDI and have not been able to buy the MAW160 (their new Emerging Market Fund). It allows me to buy all their other Mawer funds except for this one.


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## GreatLaker (Mar 23, 2014)

Lenticular said:


> Great Laker: I have an TTDI and have not been able to buy the MAW160 (their new Emerging Market Fund). It allows me to buy all their other Mawer funds except for this one.


Yes I have noticed that too. I seem to recall someone posted that they asked TDDI and the response was simply that it is not available with no further explanation.

Have you tried contacting Mawer to see if they plan to offer it through TDDI or other discount brokers? Just guessing but maybe Mawer is only selling it direct to limit demand.


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## caltran (Mar 16, 2017)

Probably will show up eventually. It just showed up on Google Finance last week.


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## Lenticular (Mar 18, 2017)

caltran: Just talked to TTDI and they said it will not be available to direct investing accounts. Strange since all other Mawers funds are available. Couldn't really get a good answer out of the representative why it will not be available.


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## caltran (Mar 16, 2017)

If you open a new account with them I'm sure it'll be made available for you


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## getliquid (Mar 2, 2014)

able to buy through CIBC not TD.


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