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What is a mutual fund?

A mutual fund is a collection of investments like stocks, bonds, and other funds. It lets you pool your money together with other investors, making it easier for you to own a more diverse array of investments. The fund is professionally managed to make sure it performs well, so you don’t have to worry about buying and selling investments on your own.


You can invest in mutual funds on their own or include them as part of a registered investment, like your RRSP or TFSA.

Invest in mutual funds


Benefits of mutual funds

Affordable

You don’t need lots of money to start investing in mutual funds. An initial investment of $100, or $25 per month, is all you need to start growing your money.


Earn more, simply

Get the most out of your money - mutual funds aren't guaranteed, but they typically earn more than savings accounts or GICs. Plus, they’re professionally managed.


Diversification

By pooling investors' money, mutual funds can buy a variety of investments. This helps offset risk - if one investment performs poorly, your loss will be limited.


Earn more money with mutual funds

Unlike savings accounts and GICs, which earn money through interest, mutual funds earn money based on the dividends, interest, and capital gains of a wide array of assets. While your principal isn’t guaranteed and returns can vary, mutual funds typically result in more growth over time. Make mutual funds part of your investment plan to grow your savings faster.

Tip: Regular investing can help you stay on track. Set up regular automatic payments, like $25, $50, or $100 per month, to grow your money!


Potential growth comparison starting with $10,000 and investing over 35 years. The graph shows that investing an initial $10,000 and then $100 a month in a balanced mutual fund with a 5% rate of return results in a total $171,420 after 35 years. Investing an initial $10,000 and then $1,200 a year in a GIC with a 2.55% rate of return results in a total $92,382 after 35 years.

Start investing

Meet with us talk about your goals and start investing in mutual funds.


Frequently asked questions

  • Do mutual funds have fees?

    Yes, though the exact amount depends on the fund. Fees pay the cost of managing the fund. They’re included in the cost of the fund.

  • Are mutual funds high risk?

    Mutual funds are generally higher-risk than savings accounts and GICs, which are principal protected and can have guaranteed returns. However, the risk varies depending on the type of fund. Also, the risk can be offset by the fact that funds often hold diverse investments. For example, if one investment, like stock in a particular company, performs poorly, the fund’s other investments can help balance it out.

    Some mutual funds invest in particular industry sectors, and if the industry as a whole is struggling the fund would likely experience a loss. We can help you understand your risk profile and where your money is invested.

Legal

Mutual funds are offered through Credential Asset Management Inc. Mutual funds and other securities are offered through Credential Securities, a division of Credential Qtrade Securities 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 insured nor guaranteed, their values change frequently and past performance may not be repeated. Credential Securities is a registered mark owned by Aviso Wealth Inc. NEI Investments is a registered trademark of Northwest & Ethical Investments L.P. Northwest & Ethical Investments Inc., is a wholly-owned subsidiary of Aviso Wealth Inc. (“Aviso”). Aviso is a wholly-owned subsidiary of Aviso Wealth Limited Partnership (“Aviso Wealth LP”), which in turn is owned 50% by Desjardins Financial Holdings Inc. (“Desjardins”) and 50% by a limited partnership owned by the five Provincial Credit Union Centrals (the “Centrals”) and the CUMIS Group Limited.

The information contained in this article was obtained from sources believed to be reliable; however, we cannot guarantee that it is accurate or complete. This article is provided as a general source of information and should not be considered personal investment advice or a solicitation to buy or sell any mutual funds.

**For illustration of the potential growth comparison between a balanced mutual fund vs GIC.