Management fees are a given when it comes to financial and investment management. Even investments that come without advice involve fees that affect your capital. These costs, which cover fund-related administration and services, take the form of a management expense ratio (MER), which is deducted from your assets. Assuming the same gross return, lower management expense ratios therefore mean higher assets over the long term, which is the ideal scenario for any investor.
Small percentage, big difference
Since it is a not-for-profit organization, a unique business model in the industry, FÉRIQUE Fund Management aims primarily to cover the management fees and operating expenses without creating a profit margin. By exercising rigorous budgetary management and reaching for positive market returns, it can pass along any surplus to clients in the form of lower MERs. This is also why the management fees for all FÉRIQUE Funds and Portfolios are among the lowest in Canada in comparison to their reference universe.1
FÉRIQUE Fund Management reduces management fees for three portfolios
In conjunction with the launch of two new FÉRIQUE Portfolios, FÉRIQUE Fund Management has just reduced the management expense ratios (MERs) for the FÉRIQUE Moderate, Balanced and Growth Portfolios.
The management expense ratios for the FÉRIQUE Portfolios now stand as follows:
The FÉRIQUE Advantage
As shown in the following graph, this can result in a significant advantage for the owners of FÉRIQUE Funds or Portfolios who remain invested in the market for a number of years.
LOWER FEES, HIGHER CAPITAL OVER THE LONG TERM
Hypothetical Annual Return of 5%
Source: FÉRIQUE Fund Management
In this example, we compare the return net of fees of the FÉRIQUE Balanced Portfolio, which now has a MER of 1.05%, with a competing balanced fund that has a MER equal to the industry median MER for this category, i.e. 2.17%. We assume an initial investment of $500 and a further investment of $500 each month. The result? After 35 years, assuming a steady 5% return before fees for both investment vehicles, your FÉRIQUE Portfolio would be worth $95,000 more than if you had invested the same amount in the competing fund.
In fact, this latest MER reduction highlights the advantages of the FÉRIQUE business model, which consists of offering performing mutual funds with management fees among the lowest in the industry1 – and high-quality advice offered at no additional charge5 to help in making informed decisions.
Would you like to know more about the FÉRIQUE investment solutions and management fees? Contact our Mutual Fund Advisors and Representatives at Advisory Services. They would be pleased to help you.
Services d'investissement FÉRIQUE and Gestion FÉRIQUE are non-profit organizations that work solely in your interest: Our profits are reinvested to benefit our clientele. Combining a competitive approach in terms of performance with management fees that are among the lowest in the industry, plus quality advisory services at no extra cost, our lineup is one of the most advantageous.
FERIQUE Investment Services
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Toll free 1-800-291-0337