Mutual Funds
A mutual fund is a portfolio or collection of assets managed by a professional fund
manager. This portfolio can include anything from stocks and bonds to cash, which
are then sold on the worldwide market.
When you invest in a mutual fund, you’re purchasing units of the fund and becoming part owner of a large investment portfolio. Every day, the portfolio manager will count up the value of all the funds holdings, figure out the outstanding units, and calculate the price of a single unit for the fund that day. Since the total number of outstanding units bought or sold changes every day so does its price.
However, the amount of risk depends on the types of investments in the funds. For example, if a fund wants to grow in value over the long term, it may invest in companies that have a higher degree of risk. As a general rule, the higher the risk, the higher the expected potential return. At the same time, since mutual funds contain a diverse number of investments, they can minimize risk if an individual investment should under-perform.
Mutual fund investments are offered through Credential Asset Management Inc. and include those managed by such leading companies as AGF, Fidelity, Northwest Ethical Funds®, Franklin Templeton, and Mackenzie. No matter what type of investor you are, a variety of mutual fund investment solutions are available that fit your style.
Benefits
- Professional Management - Portfolio managers have the professional expertise to analyze the market and buy and sell securities that best fit the investment objectives of both the fund and its investors.
- Diversification - By investing in mutual funds, you automatically have holdings in a broad range of securities and assets which adds stability to your investment portfolio.
- Choice - Portfolio managers have access to a wide range of securities that are normally unavailable to individual investors. With thousands of Canadian mutual funds available to choose from, you can find various funds that can perfectly fit your investment need.
We recommend Mutual Funds if:
You want your investments to be low risk:
- Money-Market Funds provide you with a modest income.
- Money-Market funds invest in treasury bills guaranteed by the government, as well as other low risk investments.
You’re willing to take a bit of risk:
- Income Funds provide you with a steady income.
- Income funds invest in income-oriented investments such as bonds, income trusts, preferred shares, mortgages and other securities.
You’re looking for balanced income and growth:
- Balanced Funds provides those investors willing to take some risk with both income and growth potential.
- Balanced funds invest in a combination of equities, income-oriented investments, and money-market instruments to help optimize potential returns.
You’re looking for growth, comfortable with equity investments, and/or long-term investment:
- Equity funds provide the potential for long-term above-average returns with the corresponding level of risk and volatility.
- Equity funds invest in stocks traded on stock exchanges in Canada, the U.S. and around the world. These funds may be broadly diversified or may concentrate on a specific country, sector or company size.
Credential Disclosure and Mutual Funds Disclaimer
Mutual funds are offered though Credential Asset Management Inc. Commissions, trailing commissions, management fees and expenses all may be associated with mutual fund investments. Please read the prospectus before investing. Unless otherwise stated, mutual fund securities and cash balances are not covered by the Canada Deposit Insurance Corporation or by any other government deposit insurer that insures deposits in credit unions. There can be no assurances that the money market fund will be able to maintain its net asset value per security at a constant amount or that the full amount of your investment in the fund will be returned to you. Mutual funds are not guaranteed, their values change frequently and past performance may not be repeated.
Ethical Funds are sold in all provinces and territories across Canada. However, Credit Union affiliates, such as Meridian, may not have representatives in all provinces or territories.
®Ethical Funds is a registered mark owned by Northwest & Ethical Investments L.P. and is used under licence.
®Credential is a registered mark owned by Credential Financial Inc. and is used under licence.