# Are mutual funds really that bad?



## NicW11 (Mar 3, 2012)

I have a fair amount invested in mutual funds in RBC. I have only become 'interested' in understanding my investments in the last year. As many others, I grew up hearing that I should invest in mutual funds, so I did, without understanding what they were. I hear alot how bad mutual funds are, and how high there MER's are, but I'm having trouble understanding all the bad press. I think my mutuals did pretty well last year - even after the MER's. One return was 12.3%, another was 11%, and the last was 10.7%. We got crushed in 2008/2009, but that was true of all investments, whether it was individual stocks, or mutuals. 

I want to meet with my RBC Advisor to discuss my investments, but I need to get a handle on this before I go in. If I should be considering moving my investments out of mutual funds, why? And is it even possible being as though they're in RRSP's?


----------



## avrex (Nov 14, 2010)

Yes, mutual funds are bad for your long-term financial health.

Are you invested in Mutual funds? Congratulations, you’ll now be working an additional 3 years.


----------



## doctrine (Sep 30, 2011)

It's pretty well studied that mutual funds lag their indexes by approximately their costs. I would bet that most of your RBC mutual funds have fees that range from 2% to 2.5%. I think you'll find, for the most part, that if you look beneath the hood of your mutual funds that they're not as complicated as you might think.

For example, the giant RBC Dividend fund has $14 billion in assets. It's top 5 holdings are.. the five big Canadian banks. Do you really have to pay them 1.8% a year for this investing advice? The fund's 10 years returns are pretty good, but then again so is the 10 year return of the TSX.

Of course, this "dividend" fund only pays about 1% yield and this has been declining over the last 5 years. You could buy RBC stock itself at a 4% and increasing yield - or just buy some of all 5 Canadian banks, like RBC did. Over the last 10 years, RBC's stock has outperformed its own fund, which from its performance looks like one of the top mutual funds of the last 10 years. The difference is very close to 20%, which is what the fees would have probably cost you over this period. 

http://quote.morningstar.ca/quicktakes/Fund/f_ca.aspx?t=F0CAN05O7X&culture=en-CA&region=CAN 

This has taken me about 5 minutes to figure out... investing on your own doesn't have to take a long time. What you should probably do is add up the fees of all your RBC funds and decide if RBC is providing you a valuable service for this money.


----------



## slacker (Mar 8, 2010)

A 2.5% MER will approximately delay achieving your financial goals by 10 to 15 years.

It will help your bank achieve their financial goal faster though.


----------



## Sherlock (Apr 18, 2010)

Paying a high MER is still smarter than people who keep all their money in GICs and HISAs because they're afraid of any market risk whatsoever.

In my opinion a low-MER index mutual fund is the way to go if you contribute money to your investments monthly and don't want to pay commission fees.


----------



## Xoron (Jun 22, 2010)

NicW11 said:


> I want to meet with my RBC Advisor to discuss my investments, but I need to get a handle on this before I go in. If I should be considering moving my investments out of mutual funds, why? And is it even possible being as though they're in RRSP's?


Here's what I did.

Calculate the Expenses of a sample 100k portfolio. Break it down to approximately what you have already with RBC. Lets say you have 30% Cad Equities, 30% US, 30% International, 10% bonds all in ETFS:

CAD - XIU.TO
MER - 0.18%
Expenses on that 100k portfolio (30% of you overall portfolio x 100k of investable assets x 0.18% MER) = 
$54 / year

USD - XSP.TO
MER - 0.22%
Expenses on that 100k portfolio (30% x 100k x 0.22%) =
$66 / year

INTL - XIN.TO
MER - 0.50%
Expenses on that 100k portfolio (30% x 100k x .50%) = 
$150 / year

Bonds - XSB.TO
MER - 0.28%
Expenses on that 100k portfolio (10% x 100k x .28%) = 
$28 /year

Total expenses (excluding trading costs) is $298 / year. 

How much is charged (in MERs) with your RBC Mutual Funds each year?

(Note: You'll have to customize the portfolio % to match the mutual funds you hold with RBC. This is just a quick example.)

Here is the thread I started on trying to get my wife to dump her Investment Advisor at TDHW
http://canadianmoneyforum.com/showthread.php/9546-How-to-Convince-My-Wife-to-Dump-Her-Mutual-Fund(s)


----------



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

And so begins the season of a push by the banks to meet with their customers to get us to sign up for more fees.

Why do you want to meet with your "advisor"? You seem to have already made up your mind on that. It's good that you came here first, but you do realize the job of these "advisors" is simply to sign you up to pay more fees, right?

If you are getting that type of performance, you are way ahead of everybody else. Please post the funds that gave you those types of returns.

Note that the alternatives to MFs require a lot more homework and understanding. MFs are easy. Doing it yourself is going to take a lot more time and study. You will also need quite a bit of money to get low fees and self-directed investing, such as with TDW.

I have the opinion that cash is king until you figure all of this out. Ignore those who say money in a savings account is just "sitting there not doing anything". That's just rhetoric.


----------



## NicW11 (Mar 3, 2012)

I'm heading to work but will post my individual asset allocation later tonight. I'd like feedback on it. The bank didn't call me actually - I'm initiating the meeting because it's been over a year, and if I'm paying 2.something in MER fees, they better work to earn that money. 

Thankf for all the comments, I appreciate you all taking the time to help me understand so I can reach my financial goals faster. 
Nic


----------



## Oldroe (Sep 18, 2009)

You can do very well with high mer mutual funds. The problem is the research involved. The stat. is like 20% make money so you need to fined these funds and invest there. 

This takes knowledge and a lot of time. This same time could spent DIY and have that 2-2.5% as pay to you. 

You will hear a lot about ETF's here, they also take time to understand. They are the hot flavor and have went from very few to 100's of different etf's (that's a bad sign). 

Reading prospectus is tough but necessary for every mutual/ETF .


----------



## underemployedactor (Oct 22, 2011)

MFs aren't my bag, but if you only have a small amount of money and an aversion to investing homework, then they offer a convenient one stop shopping. The fund of funds offer huge diversity for a small minimum investment. For example the RBC Select Balanced offers all the diversity you could want for a 1.94 MER and $500 investment which doesn't seem unreasonable to me for some one that has say less than 5 or ten grand to invest. 
Wow, I almost even convinced myself. I should become a mutual fund salesperson...


----------



## Eclectic12 (Oct 20, 2010)

NicW11 said:


> I'm heading to work but will post my individual asset allocation later tonight. I'd like feedback on it...


Great ... that will make the comments easier to apply.

There are a couple of thinks to keep in mind when thinking about the "MF versus other options" debate.

The first is that until discount brokers became widely available (plus cheap internet access), MFs were a good, cheap option (ex. think about comparing a 2.5% MER versus $150 a trade which requires phone calls).

Then too - a lot of posters here have over time built up knowledge so what does not take a lot of time for them or they've already worked out time saving systems.

As well, the investing system used has to match up with the time/personality of the investor. So IMO, even if a MF is not a good choice in the long run, if it enables one to sleep at night while building the skills to take over - that's much better than the mattress or cases of beer.

So it's good that you are exploring but whether MFs are right for you now and what's best in the future is up to you. It might be a good think for now where you discover that as you learn/explore, it becomes less attractive.

I think of them as a tool in the toolbox that I've moved on from (my main use was to use small amounts to grow the total so that I would qualify for the cheaper discount broker commissions, prior to Questrade etc. coming into the market).

So take the comments with a grain of salt.

Cheers


----------



## dogcom (May 23, 2009)

MF's that you can escape from like no load bank funds are a good idea while you figure out the direction you want to head in. Doing the DIY before you know yourself and have enough information about what you are buying can be much worse then high MER funds as you can mess around without discipline in a DIY account. It is a pain in the *** talking to an advisor and stuff but at least it can provide some protection from yourself while you get a handle on what you want to do.


----------



## 44545 (Feb 14, 2012)

Mutual funds get a lot of bad press but not all of them are created equal.

You can get low MER, index mutual funds that make a lot of sense for investors who wish to regularly buy more units of them. The TD e-Series have no deferred sales charges and no trading commissions.

"Canadian Couch Potato" has written several great articles explaining why you'd use them over ETFs that track the same indices:
http://canadiancouchpotato.com/2012/07/30/comparing-the-costs-of-index-funds-and-etfs/
http://canadiancouchpotato.com/model-portfolios/

The bottom line: if you're following an index fund strategy and perform annual or semi-annual rebalancing, _the trading commissions of ETFs will cost more than their lower MERs are saving you_ until your portfolio grows to a certain size.

Example:

TDB909, the e-Series index mutual fund tracking the DEX Universe Bond index has an MER of 0.51%.

The iShares "XBB" ETF tracking the same DEX Universe Bond Index ETF has an MER of 0.33% but would probably incur trading commissions to buy and sell. ($30 per transaction if your portfolio is still small) There is nothing complicated or nefarious about either - they're simple index tracking funds, without active management that would be appropriate as the bond component for a Canadian investor.

I suspect the bad rap mutual funds have gotten might stem from companies like Investors Group and Manulife whose mutual funds have extremely high MERs (2.5%+), commissions, deferred sales charges and penalties for selling within 7-years. They do that while basically owning the same assets as the above index funds but they don't specifically say they're index trackers.

*** *** *** 

I was referring to passive index funds above. Actively managed funds are a different kettle of fish and there's a large body of evidence indicating, over the long run, they will not continue to outperform. There are many books written on this topic. "The Four Pillars of Investing", "The Investor's Manifesto," "The Boglehead's Guide to Investing," to name a few.


----------



## Young&Ambitious (Aug 11, 2010)

TD e-series I second (or third?). Anyhow, apparently their 2012 returns have come in and the funds have down quite nicely. Check out the thread '2012 returns' in the general discussion forum.


----------



## andrewf (Mar 1, 2010)

TD's e-series are a good index MF solution, but I would still say that even if you have a small portfolio now, they may not be the best choice. If you expect to contribute enough to the portfolio over the first few years to justify using ETFs instead, I'd start with ETFs rather than having to migrate from MFs to ETFs at some point in the future.


----------



## Four Pillars (Apr 5, 2009)

andrewf said:


> TD's e-series are a good index MF solution, but I would still say that even if you have a small portfolio now, they may not be the best choice. If you expect to contribute enough to the portfolio over the first few years to justify using ETFs instead, I'd start with ETFs rather than having to migrate from MFs to ETFs at some point in the future.


+1


----------



## pwm (Jan 19, 2012)

CJOttawa, you make a good point. Mutual Funds can be a very good tool for asset accumulation, and they have been somewhat unfairly denigrated in the press lately because of high MERs, trailer fees, DSCs etc. It's a known fact that most fund managers do not beat the appropriate index over time, after the MER is considered, but that does not mean that they ALL do not. I've been going through the process of examining the mutual funds in my accounts for the last while to see if I should keep them all. I have since sold two funds that I consider have not beat the closest index and therefore have not earned their respective MER. I'm down to holding only four MFs now and I believe these have consistently beat their index by more than the MER they charge so I continue to hold them. Here's part of an item at TDW from Rob Carrick that appeared today that is quite relevant. It's part of his "investing Rules" for 2013:

_Benchmark every mutual fund you own against a comparable ETF 
Returns are too hard to come by these days for investors to have them eaten up by over-priced, under-achieving mutual funds. ETF fees are a small fraction of what most mutual funds charge, which means less drag on returns. If you own a Canadian equity mutual fund, compare its return to an ETF like the iShares S&P/TSX Capped Composite Index Fund (XIC). XIC’s management expense ratio is 0.27 per cent and it has outperformed the average Canadian equity fund over the past three-, five- and 10-year periods to Nov. 30, 2012. Some mutual funds earn their fees with consistently competitive returns. Keep them, and discard the rest.
_


----------



## pwm (Jan 19, 2012)

BTW, just to put this in context, I've been investing since 1979, have a total of $1.65 million invested. About 25% of that total is still in mutual funds, the rest is in common shares, preferred shares, and ETFs. All new money is going into more ETFs and common shares; I'm not buying any more MF units any more.


----------



## MoneyGal (Apr 24, 2009)

Your avatar makes you look surprisingly young. Perhaps one of your successful investments was in the Fountain of Eternal Youth.


----------



## pwm (Jan 19, 2012)

Yes, it's amazing how I've maintained my youthful appearance.


----------



## dave2012 (Feb 17, 2012)

One of my sons RESP was in several Mackenzie mutuals for the last 12 years. Over the 12 years it gained a whooping 3.49%, thus averaging .29% per year! Absolutely pathetic returns and I am kicking myself for trusting these bozos all those year. Mind you Mackenzie and the 'sales advisor' I used enjoyed the approx 2.5-3% MER I paid each year on the various funds over the 12 years so they are quite happy. I am just in the process of dumping this garbage and transferring it to an Edge account.

Same experience in other accounts which I dumped last year. Costly but well worth dumping!

To me, mutual funds are the next worst thing to labour sponsored funds lol.


----------



## My Own Advisor (Sep 24, 2012)

Yes, mutual funds are bad. Period.


----------



## NicW11 (Mar 3, 2012)

Wow, lots of information. Thank you all. I need to take time to understnd it all!

The return that gave us over 12% last year, was:
15.38% Income Funds which was comprised of (RBC Bond Fund and RBC Global Corporate Bond Fund)
63.67% Canadian Equity Funds (RBC Canadian Dividend Fund, O'Shaughnesssy Canadian Equity Fund and North American Growth Fund)
6.36% US Equity Fund - all RBC O'Shaunessy US Growth Fund
14.59% International Equity Funds (RBC International Index Currency Neutral and RBC O'Shaunessy International Equity)

We started the year with 134,068.53, didn't put any money into this fund, and ended the year with 150,451.87. To me that was a pretty good return, but if I can do better by redirecting this money, I would be happy to learn how. 

We stopped contributing to Mutual Funds a year ago, and started stock market investing. For now, I'm trying to purchase quality, dividend paying companies as I learn my way around the stock market. Our Mutual Funds are in our RRSP's - can I transfer money to a different investment vehicle without suffering tax consequences?


----------



## Oldroe (Sep 18, 2009)

Leave the fund money and spend time buying these stocks. Watch and study.


----------



## NicW11 (Mar 3, 2012)

oldroe - can you clarify? Do you mean to leave this mutual fund alone, and use new funds to buy these exat same stocks on the stock market?


----------



## Belguy (May 24, 2010)

There are a few good mutual fund companies out there who charge low fees. Mawer is one that comes to mind:

http://www.mawer.com/

If I had used some of their funds, including the Mawer Canadian Equity Fund, in an 'Couch Potato' portfolio, I would not likely have regretted it.

http://www.mawer.com/mutual-funds/fund-profiles/mawer-canadian-equity-fund/

Or the Mawer International Equity Fund which is another Morningstar five-star fund:

http://www.mawer.com/mutual-funds/fund-profiles/mawer-international-equity-fund/

In addition to both being five-star Morningstar rated funds, they both have low MER's and they both consistently beat their respective indexes and therefore any ETF's tied to those indexes.

Maybe ETF's aren't ALWAYS the best choice in a given segment or geographical area.

Buyer beware and do your research. Consider low fee managed funds that have consistently outperformed their related indexes as these two Mawer funds have.

There are many examples. Here is another one in the high yield bond category which consistently performs in the top quartile and therefore would outperform all ETF's that track the same index:

http://funds.rbcgam.com/pdf/fund-pages/monthly/rbf1010_e.pdf

Conclusion: No, not all managed mutual funds are that bad. You just have to shop carefully and open a discount brokerage account so that you are not tied to a single family of funds but can purchase from a wide spectrum of fund companies.

One good strategy is to use ETF's for your core holdings but then use managed funds for small caps and emerging markets investments.

Here is an example, with a low MER, from a smaller mutual fund company:

http://www.steadyhand.com/funds/smallcap/

Compare the performance with some small cap ETF's!!


----------



## HaroldCrump (Jun 10, 2009)

NicW11 said:


> We started the year with 134,068.53, didn't put any money into this fund, and ended the year with 150,451.87. To me that was a pretty good return, but if I can do better by redirecting this money, I would be happy to learn how.


But you had these funds from before 2008, right?
What is your total (and annualized) return since you first invested in these funds?
That is the number that matters.

Several mutual funds are still below their early 2008 peaks, even after nearly 4 years.


----------



## Miser (Apr 24, 2011)

slacker said:


> A 2.5% MER will approximately delay achieving your financial goals by 10 to 15 years.
> 
> It will help your bank achieve their financial goal faster though.


So true!!!!


----------



## doctrine (Sep 30, 2011)

Assuming an average 2.2% MER, at the beginning of 2011 you were paying Royal Bank $2948 a year. Now this year, you will be paying them at a rate around $3300 a year. That's the beauty of mutual funds - the more you contribute, or if they actually do increase in value, the more you pay. Could you imagine over the next 10 years paying them as much as $33,000 if your account stays at this level? That money has to come from somewhere.

You should start by getting all of your mutual funds into a self-directed account where you can make decisions, if you haven't already. If you still like RBC, you could look into a RBC Direct Investing account. You need an RRSP account though; you cannot take them out of the RRSP without suffering major tax consequences. But a transfer from one RRSP-managed account to another RRSP self-directed account is fairly simple and there are no tax consequences.

It sounds like you're on the right track, by ceasing contributions and looking at individual companies. If you're hesitant about transferring all your mutual funds directly to individual companies, you could take an interim step and easily set up an ETF portfolio with fees much lower than RBC's mutual funds. Look at the model portfolio's here -> http://canadiancouchpotato.com/model-portfolios/. Although I am a huge advocate of owning companies directly, I do realize that index investing can sometimes be appropriate as well.


----------



## Oldroe (Sep 18, 2009)

For now leave the funds. Use new money to invest in stocks DIY. 

Theirs no better way to learn than having some skin in the game. The ups and down can be very stressful. Selling is the hardest thing to do, and keeping cost down is very important.

When you are sure DIY is something you like then plan a orderly exit from your funds.

Most of your funds are likely back loaded so you have penalties.


----------



## NicW11 (Mar 3, 2012)

HC - yes, I've had this mutual fund since 2003 and it went down substantially in 2008, but didn't the entire market? Would it have rebounded better or been better in the long run if I had been invested in equities as opposed to Mutual Funds? (re-reading this it sounds defensive, but it isn't intended to be. I'm genuinly interested in developing better investing strategies, and trying hard to understand!). Annualized since inception has been 3.91%. Yes, thats bad, I realize, but I'm just not sure if anywhere else had done any better in the same time frame. 

doctrine - thanks for the insight into moving from mutuals to self-directed RRSP's. I will look into that, its the kind of info I was hoping to hear. My husband already has an RBC Direct Investing account, but I'm pretty sure its not held within his RRSP, so I assume we'll need to set up another one. Is there a limit to how many investment accounts a person can have? I'm not necessarily partial to RBC, we've just simply been with them for over 25 yrs, so its all we know. I also have a Questrade account thats in my TFSA.

To me mutual funds = rrsp's and tfsa = savings account, and even though I know better, I still have trouble realizing there are different investment vehicles. It seems foreign to me that my RRSP's can be company's that I trade on the stock market myself. Lots of learning to do! Lots of knowledge and insight on this forum though and I sure appreciate it.

Thanks for all your valuable information, I certainly need to make an appointment and ask my 'advisor' why I don't even get a Christmas card with the amount of money I'm apparently paying them.
Nic


----------



## My Own Advisor (Sep 24, 2012)

Mutual funds are products.

RRSP, TFSA, High Interest Savings Account, Self-Directed Brokerage Accounts are accounts 

You can own different products in different accounts. 

Think of accounts like different sized jars (of money) you can fill sitting on the kitchen table. You can put different stuff (products) into each jar. Some jars have more restrictions that others, what products you can put into them. It doesn't have to be overly complex but learning what you can / cannot put into each jar can can lower your taxes, lower your investing fees and ultimately increase your wealth. 

Totally agree with other comments, you'd be wise to move out of MFs you currently hold in some of your accounts.


----------



## Cal (Jun 17, 2009)

Oldroe said:


> Leave the fund money and spend time buying these stocks. Watch and study.


Thats what got me starting dividend investing in the first place, I figured why am I paying 2+% to hold BCE, ENB, BMO, FTS, EMA, T.A, SLF as my top holdings in a in a Canadian Dividend Fund. Why not just buy them myself.


----------



## My Own Advisor (Sep 24, 2012)

Totally agree Cal. Own directly what the top dividend ETFs, XIU and dare I say it, the top mutual funds own. Forget any fees after that.


----------



## HaroldCrump (Jun 10, 2009)

NicW11 said:


> HC - yes, I've had this mutual fund since 2003 and it went down substantially in 2008, but didn't the entire market? Would it have rebounded better or been better in the long run if I had been invested in equities as opposed to Mutual Funds? (re-reading this it sounds defensive, but it isn't intended to be. I'm genuinly interested in developing better investing strategies, and trying hard to understand!). Annualized since inception has been 3.91%. Yes, thats bad, I realize, but I'm just not sure if anywhere else had done any better in the same time frame.


Well, my point above was that when evaluating a mutual fund, do not look at the most recent annual return because it is meaningless for you.
All that matters to you is what *you* have made (annualized) by holding the fund.

There are tomes of data that show that mutual fund investors underform the fund itself, because of entry and exit points.
It does not matter than the fund made 12% last year, if your return is 3.91%.

I am not beating up on you, but you can help yourself make the decision by looking at your personalized annual returns and the reasons for holding the fund.
You also have to align your investment decisions with your psychology - are you comfortable making your own stock picking or asset allocation decisions?
If not, is this something that interests you to learn and manage on your own.
Or do you feel better having a mutual fund make the asset allocation decisions for you?

Fortunately, your portfolio is at a size where all the options are open for you.
It is large enough to get you lower commissions at discount brokerages, yet small enough to manage on your own (that is not meant as disrespect).


----------



## marina628 (Dec 14, 2010)

We still have 5 mutual funds at TD Bank that I have not moved to eseries ,two are in my daughters RESP and three are between my RSP and my husband's RSP.I posted the YTD returns beside them,I plan to make the switch just have yet to get around to it.As my GIC come up I am rolling them into the TD Comfort Growth Portfolio and TD Nasdaq Index equal 50/50 split for 2013 but will do these via webbroker in my self directed plan.
TD comfort balanced growth portfolio 7%
TD dividend growth 9.4%
TD nasdaq index 14.8%
TD north american dividend 5.2%
TD comfort growth 7.3


----------



## doctrine (Sep 30, 2011)

Let's benchmark this 10 year performance. Annualized gains over 10 years: 3.91%. After inflation, that is about 1% per year. An investment in a business should be returning more than 1% a year - the historical real return of stocks is closer to 6.7%. Over this 10 year period, the S&P 500 was returning 8% a year and the TSX was returning 9% a year (including dividends). You would have more than doubled your money in either or in a split between the two. The fact that you were about 4% off is accounted for by mostly your fees but also active management of the fund managers - some funds have 100% or greater turnover every year! 

Just think - your real return was reduced from 4-5% to around 1%. That is what 2.5%+ a year in fees plus turnover can do - they demolish your real returns after inflation.

Reasons and evidence like this is why people are fleeing funds and looking for better options.


----------



## marina628 (Dec 14, 2010)

Harold is correct in what he said about not looking at just 12 month return,we had many more mutual funds and was down at one point 42% in my husband's RRSP in 2008,thank god we stayed in but once we recovered from that we started moving most of them into his self directed rsp and bought mostly Canadian dividend paying stocks with them.We have maybe 16% of entire portfolio into MF now and since i started taking more active role about 18 months ago we have done much better than just taking the bank advise although I cannot complain with over all performance.I actively sell off MF and move them around too when there is decent profits to be made.I made huge 30%-40% when I sold off all my TD Precious Metals Mutual Funds.Before I found this forum i would buy a fund and keep it forever ,I really can't say thank you enough for you guys giving me the confidence to do the things I have done the last couple years!


----------



## NicW11 (Mar 3, 2012)

So here's an interesting calculation I just completed...I took some time to figure out the gains on one of my mutual funds and what it would have been had a been a DIYinvestor. 

I used the mutual fund that I said gave me 10.7% returns, which is an RBC Canadian Dividend Fund account. I only used the top 5 holdings within that (there are 80+ and I wasn't going to take the time to figure all out), and those holding happen to be RY, TD, BNS, CM, and BMO - the top 5 Canadian banks. Because I only used the top 5, I realize that these calculations are not accurate, but it likely gives me a good idea of MF vs DIY. The other variable is that in my calculations, I didn't DRIP - too much work! - therefore my DIY is a little shy of actual. My findings...

Had I self-directed these investments, I would have been up $254.00, and this is on just one small fund worth under $5000. I could have been up 16.3% but instead I'm only up 10.7%. Our other Mutual Funds balances are much higher - can you imagine the loss I've incurred on those? Wow, ok, I'm a believer. Mutual Funds are bad.

HC, you make a good point about psychology and investing, and I would say with our ages and retirement goals, I am comfortable making my own stock pick choices. I am very intrigued with investing/stock market watching (this has only been in the past year - didn't have a clue before that), and I think right now I would fall into the category of long-term investor seeking moderate appreciation and decent dividends. We are 10ish years away from retirement (sooner if my husband had it his way, but I like my job(s) - and money - and will work much longer), and I'd like to position ourselves so we have a solid monthly dividend income in retirement. I am also intrigued with short-term and swing trading, but don't have enough education in this area yet to confidently trade. 

Thanks to all for your insight, and helping me realize why MER's of 2.2% are so dragging on a portfolio!
Nic


----------



## My Own Advisor (Sep 24, 2012)

Mutual funds are bad 

http://www.myownadvisor.ca/2011/07/why-i-left-the-mutual-fund-industry/


----------



## marina628 (Dec 14, 2010)

Ok so one of my goals in 2013 is to go into bank convert them all to eseries


----------



## Oldroe (Sep 18, 2009)

The only funds I have are jr. Oil/gas, Jr metals. The mer's are much higher and so is the level of understanding. Mostly geology report are a nightmare for me. This is only 5% of our holdings.

Still take your time getting out of these funds It's a very big step. Markets up and down stress up and down.


----------



## Eclectic12 (Oct 20, 2010)

^^^^

Or another place that makes sense for me is an emerging market where getting information is difficult for the small guy.


Cheers


----------



## lonewolf (Jun 12, 2012)

Before the crash in 1929 there were investment trusts. After the hit from 1929 - 1932 I remember reading they had to change the name of these products to get investors to invest in them. The new name mutual funds.

After white water involving the first lady & goverment Sachs. ( taking better market fills that belonged to joe puplic & swicthing a worse fill by the first lady by goldman) One has to really wonder whos taking the other side of the trade when a mutual fund buys & sells.


----------

