# TD eseries limited by 'comfort portfolio'



## Drakestar (Jun 1, 2010)

so i have started to put money away into the TFSA e-series (TD).

I have tried over the past couple of days to by additional money into it via easyweb.

I get a reply email from TD stated that the purchase I'm trying to do is outside of my comfort portfolio setting.

Does every TFSA account have a comfort portfolio that I have to stay within the confines of?

I was under the (perhaps wrong) impression, that by being an e-series account that I was responsible for all the buying/selling managing that I wanted to do without TD investment help.

So am I stuck with with whatever I filled out in the initial paperwork, or can I break free on ANY comfort portfolio?

thank you.


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## plen (Nov 18, 2010)

I've never heard of that with my e-Series RRSP account. I've been able to buy and sell with no issue, including 8 different PPPs from as low as $25 a week.

Are you near your TFSA max contribution limit?

What is the exact phrase the email says when they deny your request?


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## humble_pie (Jun 7, 2009)

i would certainly believe that you can modify your original profile (which you did fill out & sign when you opened the account, as did every investment account holder in canada), because most people's life circumstances change as time passes, and therefore their risk tolerances need to be updated from time to time.

you would have to communicate with the td, though.

it is cold comfort to say this, but the broker is required to make sure that each client pursues investments that are prudent for his profile and goals. All of the big discounters have super-vigilant compliance departments to enforce this, because discounters have no room in their budgets for any kind of trouble. In a way, it's nice to think they are looking out for our best interests.

good luck with the modification. You may need to indicate a higher salary or net worth, or lower debt levels, or a change from student status ... or ...


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## Lephturn (Aug 31, 2009)

It sounds like your risk profile would put you in a certain investment mix - for example 30% fixed income, 70% equities - and TD has something set up to flag when you try to do something that upsets the balance you should have based on your answers to the risk questionnaire.

So you likely have a mix of funds, and you are picking one to put the additional money into? Take a look at the portfolio mix and maybe you should put it into a different fund to try and maintain your balance. You can likely go with more fixed and less equities without the warning, but going above a certain % of equities is flagging it that it's outside of what you told TD your risk profile was.

So - you can either put that money into one of the fixed income funds, or you can dig into TD web or get on the phone and change your risk profile. I would think twice before doing that though - if you answered the questions honestly and they have not changed you should likely stay within the asset mix guidelines they suggest.


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## Drakestar (Jun 1, 2010)

I think I was just abit confused as to what "e-series" actually meant.

I thought that it meant that I am in full control over whatever I buy (it IS my money to lose afterall) and in return of them not doing any advising I get a break on the MERs.

You guys (of course) were right. They are obligated to look at my profile "for my own good".

I called them and talked about it with TD. they were very friendly, and told me the same things as you did above.

I am close to my limit for this year (I was at 4800, trying to squeeze in the last 200). but that wasn't the reason.

what I was trying to buy through my "ideal" percentages off so they denied it.

They went through the questionaire again with me over the phone and my profile did change, which gives me some more leeway. The original one was way back when the TFSA first started up.

For those curious about the email they sent, I'll post another reply with it. It doesn't really say alot, other than they would be pleased to assist me...how nice of them!


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## Drakestar (Jun 1, 2010)

Order #xxxxxxxxxxxxxxx 

Dear Investor, 

We appreciate your business and thank you for your request. 

For security reasons, we have not included your name and account number in this communication. Please do not reply to this e-mail. It is our policy not to send, nor to ask our customers to send account and trade-related information by e-mail. 

We have not fulfilled your request because it may not be suited to your current investor profile. We have based this assessment on the information you provided us regarding your personal circumstances, investment knowledge, objectives, time horizon and risk tolerance. Not only do we want to help you make the best investment decisions, we are required to assess the suitability of all mutual fund account transactions. Please contact a TD Investment Services Mutual Funds Representative to review and update the information we have regarding your Investor Profile. 

For assistance, please call TD Canada Trust EasyLineTM*** at 1-866-222-3456 or visit your TD Canada Trust branch and a Mutual Funds Representative 1 would be happy to help you. If you have used our telephone service, EasyLine, in the past you will be prompted to enter your TD Canada Trust Access Card number and phone code. If you have not set up this service, simply press '2' to reach the main menu. Once in the main menu, choose option '3' for investments and then option '1' for mutual funds. After several security questions, a Mutual Funds Representative will update your account information. 

Thank you, 

TD Investment Services Inc. 



^ TD Mutual Funds and TD Managed Assets Program are managed by TD Asset Management Inc. and are available through TD Investment Services Inc. (principal distributor). 

1 Mutual Funds Representatives with TD Investment Services Inc. distribute mutual funds at TD Canada Trust. 

* Trade-mark of The Toronto-Dominion Bank, used under license.


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## the-royal-mail (Dec 11, 2009)

I had a very similar experience with RBC a while ago. I am surprised that you would still have the same constraints in this type of account. I am still deciding whether to sign up a tfsa with questrade so I don't have the aformentioned constraints. I sure hope they won't send me one of those form letters, which as I see it are mostly filler.


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## Four Pillars (Apr 5, 2009)

the-royal-mail said:


> I had a very similar experience with RBC a while ago. I am surprised that you would still have the same constraints in this type of account. I am still deciding whether to sign up a tfsa with questrade so I don't have the aformentioned constraints. I sure hope they won't send me one of those form letters, which as I see it are mostly filler.


I think the best strategy to get around this, is to place yourself in the riskiest part of the profile. They will never question you if you want a more conservative mix than your profile suggests - only if riskier.


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## the-royal-mail (Dec 11, 2009)

Agreed, and I've done exactly that. I'm as risky as they come (no lie) but they still won't let me buy more than x% of item y. And that sux.

What is it exactly that they are adhering to? Their verbage makes it sound like they are legislated to do this. Is that true? What specific legislation requires them to prevent investors from making their own decisions about allocation in a fund?


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## brad (May 22, 2009)

I had the same thing happen to me a few years ago with my e-Series portfolio. The e-Series are great, the MER is actually as low or lower than that of some index ETFs; the combined MER of my portfolio is around 0.4 and of course there are no transaction fees.

I did the same thing, just redid my investor profile to show that I was comfortable taking on risk, and re-submitted my purchase; it worked just fine.

My only real quibble with the e-Series funds is that if you want to change the bank from which they withdraw money to buy your fund shares, you have to go to a branch, you can't fill out a change order online. This is inconvenient for me as there aren't any TD branches near me so it will take about 3 hours out of my day to do this.


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## Lephturn (Aug 31, 2009)

Something tells me getting my accounts set up for options trading sort of backed RBC off on the whole "level of risk" thing. 

I suppose my questionnaire would say 100% equities anyway so that might be why I didn't see it.


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## Potato (Apr 3, 2009)

This is part of the reason why I recommend people who want the e-series funds go through Waterhouse rather than TD Mutual Funds (unless you need to be protected by your initial investor profile... but if you're in e-series, then you're a self-directed investor anyway).




the-royal-mail said:


> What is it exactly that they are adhering to? Their verbage makes it sound like they are legislated to do this. Is that true? What specific legislation requires them to prevent investors from making their own decisions about allocation in a fund?



I think it's a requirement of being a MFDA or CIPF member.
http://www.mfda.ca/regulation/notices/MR-0025.pdf

The rules seem to indicate that they only have to warn, and could process the order with a warning, but TD MF seems to go above and beyond and require you to change your risk profile before going 100% equities.


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## Jungle (Feb 17, 2010)

I got the same email a few weeks ago when I tried to buy, which _would_ have made my account 100% equity. 

I phoned them up and re did the survey. I just answered each question with the highest risk possible. THen you can do what ever you want.


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## w0nger (Mar 15, 2010)

when i did the questionnaire, i did it with maximum risk all the way, just to give me the freedom of making my own choices over time and save the hassle of updating a risk profile later on...


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## m3s (Apr 3, 2010)

the-royal-mail said:


> I am still deciding whether to sign up a tfsa with questrade so I don't have the aformentioned constraints. I sure hope they won't send me one of those form letters, which as I see it are mostly filler.


I have had 100% equity in Questrade and never got this type of warning. It would have been a complete nuisance seeing as 1 equity acct is not my entire portfolio



brad said:


> My only real quibble with the e-Series funds is that if you want to change the bank from which they withdraw money to buy your fund shares, you have to go to a branch, you can't fill out a change order online. This is inconvenient for me as there aren't any TD branches near me so it will take about 3 hours out of my day to do this.


Yup I am getting sick of being told over the phone "you have to come in to a branch" when I know the technology exists. I don't care what their hours are it is still a waste of my time to go to a branch. This is why I am leaning towards ING banking



Jungle said:


> I got the same email a few weeks ago when I tried to buy, which _would_ have made my account 100% equity.
> 
> I phoned them up and re did the survey. I just answered each question with the highest risk possible. THen you can do what ever you want.


It's interesting they look after you this way, but I think you should have the option to just ignore these warnings. Your TFSA acct may not be the entire picture, especially with the tight contribution limits I would imagine other people want 100% equity in there


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## Eclectic12 (Oct 20, 2010)

mode3sour said:


> I have had 100% equity in Questrade and never got this type of warning. It would have been a complete nuisance seeing as 1 equity acct is not my entire portfolio [ ... ]
> 
> It's interesting they look after you this way, but I think you should have the option to just ignore these warnings. Your TFSA acct may not be the entire picture, especially with the tight contribution limits I would imagine other people want 100% equity in there


Hmmmm ... from what's been posted so far, it sounds like most institutions are either ignoring the profile or sticking to it. Or maybe I missed a post about a warning,

In any case, I suspect that the survey provides protection to the institution.
Investor - "I'm upset I was allowed to buy Bre-X and lost it all. You should 
compensate me."
Institution - "You updated your profile to say you were comfortable so the 
loss is your problem."

So I don't see the incentive to change - given that if someone is upset, the answer is "sorry but it's for your own protection".

Maybe some who works in the industry can provide more details.


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## OhGreatGuru (May 24, 2009)

the-royal-mail said:


> ...
> 
> What is it exactly that they are adhering to? Their verbage makes it sound like they are legislated to do this. Is that true? What specific legislation requires them to prevent investors from making their own decisions about allocation in a fund?


Purveyors of mutual funds have a legal and fiduciary obligation to ensure that their clients know what they are getting into. Disappointed investors have sued financial instiutions, claiming "You Never Told Me...." That's why they ask all those questions about risk and create investor profiles. In the old days, when you had to speak to an agent to make a purchase, that was their opportunity to check if the investor was aware of the risks he/she was taking. Now that DIY investors are buying directly, institutions use computer screening software to determine if the asset allocation matches the profile you supplied.

Changing the profile is easy. So what's the big deal?


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## OhGreatGuru (May 24, 2009)

Drakestar said:


> Order #xxxxxxxxxxxxxxx
> 
> Dear Investor,
> 
> ...


This letter is pretty clear, and nowhere in it does the expression "Comfort Portfolio" appear.


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## 44545 (Feb 14, 2012)

Realizing I'm resurrecting an old thread, I recently converted a TD account to an e-Series account and received this email:



> FROM: [email protected]
> TO: me
> 
> Dear Investor,
> ...


(section *bolded* by me)

I understand the "Investor Profile" (aka "Know Your Client", KYC) form has to be filled out annually as well.
TD Waterhouse accounts don't have those restrictions.

More discussions about this in the comments on a blog post: http://www.givemebackmyfivebucks.co...l-fund-problem-with-td-canada-trust/#comments


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## kcowan (Jul 1, 2010)

I only had an intervention from TD when I bought a Pink Sheet investment. They were just checking to ensure I understood the risks. I doubt there is any eSeries choice that would qualify. Just necessary KYC boilerplate.


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## mrPPincer (Nov 21, 2011)

As mentioned upthread if you chose all the highest risk answers on the KYC form they won't interfere with your investment decicions.

It is a bit of a hassle to have to fill out the form every year, but it's pretty much standard procedure with the MF industry.
For PC Financial's CIBC mutual funds you have to answer all those question for every trade or change in auto-purchases; at least with TD Investment Services it's only once per year.

With my TD e-funds account, I ignored the warning e-mails one year and didn't update my profile on schedule, and they randomly rejected some of my trades for a couple of months, totally messing up my portfolio before I noticed.

So it is important to keep that profile updated, and although it is a bit of a drawback in terms of convenience, it's not a huge deal considering the benefits.


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