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About Mutual Funds


Unless you have at least ten million dollars to invest you will need to turn to mutual funds in order to buy adequate diversification. This series of articles will explore the world of mutual funds: What are they, how do they work, and how should you use them. The emphasis will be on the use of index and exchange traded funds, though we will occasionally explore other topics too.

Changes to Barclays Canadian iShares XIC, XDV, and XTR

Contributed by: martingale

Mutual Funds This is the third and final article on recent changes to the Barclays Canadian iShares (formerly iUnits) exchange traded funds. With respect to the Canadian equity market, there are three important changes to the Canadian iShares ETFs: Income trusts have been added to the TSX equity index (XIC), and there are two new equity index ETF's: A Canadian iShares fund specializing in dividend income (XDV) and a Canadian iShares fund specializing in income trusts (XTR). What do these changes to the Canadian equity ETF's mean for investors? The change to XIC is excellent news. The new XTR and XDV funds may be useful for some investors, but the average investor is better served by a straight equities index like XIC.

Changes To Barclays iShares: XSB and XRB

Contributed by: martingale

Mutual Funds Barclays has announced changes in its line-up of bond exchange traded Canadian iShares (formerly iUnits) funds, in addition to many other recent changes. Unlike the changes to XSP and XIN Canadian iShares ETFs, the changes to the bond ETFs are across the board good news for Canadian investors. XSB is what the former XGV has become: The 5 year govt. bond Canadian iShares ETF is changing into a general short-bond index. Canadians have needed an efficient way to invest in short-bonds for some time. The other new bond fund, XRB, will be some sort of real-return bond index ETF. While the details remain to be seen, adding some real return bonds to your portfolio is probably a good idea.This is the second article in a series of reviews of the new Canadian iShares ETF's.

Changes To Barclays Canadian iShares: XSP and XIN

Contributed by: martingale

Mutual Funds Barclays has announced changes to several of its Canadian iShares exchange traded funds (formerly iUnits), including the XSP/i500R iUnits, and XIN/iIntR iUnits funds. The fees and the investment objectives of each exchange traded fund is changing. Since I had previously recommended these Canadian iShares funds to self-directed RRSP investors it is time to analyze the implication of these changes. This is the first of a series of articles--subsequent articles will look at the changes to other Canadian iShares funds.

Do Mutual Fund Managers Have an Inherent Conflict of Interest?

Contributed by: martingale

Mutual Funds Mutual fund managers may have a conflict of interest because of the way they are paid. In particular, mutual fund managers are encouraged to make risky investments that are not in the interests of unit holders, and to over-concentrate their holdings. Mutual fund investors, on the other hand, would tend to benefit from less risky investments, and greater diversification. This article will explore this conflict of interest and its implications for investors who buy actively managed mutual funds.

Exchange Traded Funds: Recommendations

Contributed by: martingale

Mutual Funds Now that you can own whatever you like in your RRSP the question on everyone's mind is, what? In this article I've briefly summarized the exchange traded funds that I recommend you use to build the foreign portion of your portfolio. The majority of these funds trade on the American stock exchanges.

How Mutual Funds Work: Exchange Traded Funds

Contributed by: martingale

Mutual Funds This article will explain what an Exchange Traded Fund is, how to use them to manage your own RRSP, and what choices are available. We'll also have a look at the way mutual fund companies get paid so that you can avoid paying too much.

Canadian mutual funds are in general a lot more expensive than American funds, and there aren't a lot of different asset classes to choose from. Fortunately there are two points of light: First, American Exchange Traded Funds (ETFs) can be purchased by Canadian investors as foreign content; second, we have a few ETFs of our own here in Canada. Given the absence of good conventional funds in Canada, I highly recommend that you build your portfolio primarily from these ETFs. But beware of trading fees! In this article I will review what an ETF is, take a close look at the fees, compare ETFs and conventional funds, suggest some strategies, and provide you with a list of ETFs you should consider so as to construct an efficient portfolio.







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