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TD Asset Management (TDB***) Fund Series Conversion

  • Last Updated:
  • May 19th, 2019 7:04 pm
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Newbie
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Mar 18, 2018
47 posts
32 upvotes

TD Asset Management (TDB***) Fund Series Conversion

May be of interest to low-cost index mutual fund investors. Received a letter regarding current I-series TDB*** mutual funds in my discount brokerage, informing that they will be converting all units of the current I-series (held as of 15 April) into equivalent D-series or E-series within my account (around 14 June). Checking the trading interface, I see my current holdings of I-series can only be sold - no purchases or switching permitted. The D/E-series equivalents are available for normal trading in my brokerage - as opposed to those boxed TD accounts. I haven't checked for full list of available TDB D/E-series funds, but the reductions in MER are from 0.90% to 0.45% and of course no trading commissions. I looked for cheaper D-series MFs at the big houses a couple of years ago and didn't find those or these "Es" from TDB, so they might be fairly new or newly available on other brokerage platforms. They are for major market indices rather than the weird niche investment categories common for D-series.

(I know the well-rehearsed arguments about index ETFs versus MFs, but that cost-benefit can break down over commissions for small ETF transactions, especially in small accounts. Different brokerages do offer small lists of commission-free ETFs, but then thin trading volume has its own downside risks. Small fry investors are often safest with the guaranteed daily closing price of a mutual fund, even at a slightly higher MER.)
Last edited by AlbinForo on May 16th, 2019 1:35 pm, edited 1 time in total.
4 replies
Newbie
Jun 2, 2018
3 posts
1 upvote
ETF trading is usually no fee on most platform. There are many ETFs linked to the identical index.
Deal Addict
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Feb 1, 2012
1024 posts
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Thunder Bay, ON
Yes, it's good to see that the brokers are finally succumbing to pressure to stop selling mutual funds that pay trailer fees. Discount brokers are prohibited from providing investment advice, but in the past that did not stop them from collecting the ongoing trailer fee that was intended to be dealer compensation for providing ongoing investment advice.

Nonetheless most of my investments are broad-based cap-weighted index ETFs. I hold a couple of mutual funds from Mawer and TD, but they serve specific purposes and are <5% of my total holdings.
Invest your time actively and your money passively.
Deal Fanatic
Apr 11, 2012
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Winnipeg
What are the implications other than reduced MER?
Deal Addict
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Feb 1, 2012
1024 posts
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Thunder Bay, ON
Wpegger wrote:
May 19th, 2019 5:57 pm
What are the implications other than reduced MER?
Correspondingly higher returns with no increase in risk or volatility.
Invest your time actively and your money passively.

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