Investing

Tangerine or National Bank growth fund ?

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  • Aug 19th, 2016 7:00 am
[OP]
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Nov 29, 2007
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Quebec, QC

Tangerine or National Bank growth fund ?

I currently have RRSP and it's all in the National Bank Growth fund auto manage.

Will it be wise to switch to Tangerine or is it about the same ?
8 replies
Deal Addict
Nov 9, 2013
4543 posts
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Edmonton, AB
Pick whichever has less fees.
Keep calm and go long
[OP]
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Quebec, QC
treva84 wrote: Pick whichever has less fees.
That's really the only thing to look at ?
The team managing the fund behind it is not important ?
Deal Addict
Nov 9, 2013
4543 posts
4828 upvotes
Edmonton, AB
martbob wrote:
treva84 wrote: Pick whichever has less fees.
That's really the only thing to look at ?
The team managing the fund behind it is not important ?
Nope. I suspect the Tangerine Fund has a lower cost - if indeed it is the case pick the Streetwise fund that roughly matches the asset allocation of your Growth Fund (probably 75% stocks / 25% equities or something of the sort).

The idea that quality management matters is largely a lie that mutual fund companies propagate to try and justify their high fees.

Assuming a fixed asset allocation, the two biggest drivers of long term returns are i) fees (as they create a long term drag) and ii) total time in the market.

For example, if you had a static $10,000 investment earning 6% pear year, your future value after 30 years would be $57,434.91. If you had the same initial investment earning 5% per year, your future value after 30 years would be $43,291.91. This equates to a difference of $14,143 (32%) even though the fee difference is only 1%.
Last edited by treva84 on Aug 18th, 2016 2:47 pm, edited 1 time in total.
Keep calm and go long
[OP]
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Nov 29, 2007
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Quebec, QC
******* wrote: Mart,

What fund code is the National Bank fund you own? They have a number of growth funds. Based on the MER, its the managed portfolio as far as I can see. If so, this means you have over $100k in that fund. Is this true?
Can't find the code. Its this fund
https://www.nbc.ca/content/dam/bnc/en/p ... es/965.pdf
Last edited by martbob on Aug 18th, 2016 3:15 pm, edited 1 time in total.
[OP]
Sr. Member
User avatar
Nov 29, 2007
808 posts
300 upvotes
Quebec, QC
******* wrote:
martbob wrote:
******* wrote: Mart,

What fund code is the National Bank fund you own? They have a number of growth funds. Based on the MER, its the managed portfolio as far as I can see. If so, this means you have over $100k in that fund. Is this true?
Can't find the code. Its this fund
https://bvi.bnc.ca/bnc/page?BPPA=BPPA16 ... %2F838.pdf
link doesn't work. Thats your login page

What is the actual FULL name of the fund?
Your totaly right. Voilà https://www.nbc.ca/content/dam/bnc/en/p ... es/965.pdf

It's National Bank Growth Managed Portfolio
[OP]
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******* wrote: The National Bank growth portfolio you have is a relatively discretionary managed portfolio (i.e. "relatively" as they continuously rebalance to their original allocations - but have discretion in what % they hold, switch, sell). The total fees (management and MER) of this fund is 1.88%. Typically someone with this fund (must have over $100k invested) will be receiving on going advice from council at NBC. Are you getting advice?

Both the Tangerine Balanced Growth and NB growth portfolio are considered global balanced - from an asset allocation standpoint, although their allocations to each category are slightly different. Tangerine has slightly more fixed income (Ex. bonds) than does the NB portfolio (based on recent data). When comparing similar inception returns (using the tangerine funds start Jan 1 2008). Since 2008 to YTD, the Tangerine fund and the NB port have both returned on average about 6.45%. Jan 1 2008 - July 31, 2016.

Given this, there is little difference between the two (from an expected return point of view). There however may be differences in volatility (standard deviation) in the short term. While the Tangerine fund will always under perform the market by its MER, the managed portfolio seeks to outperform the market it is benchmarking against (whether this will happen is uncertain). If you are going to index and do not want/need the help of an advisor, you should be looking at a lower cost index funds that would do that same thing as the Tangerine fund, but at a much lower cost.
First think, thanks for the detail response! (to answer your question I do have someone that give me advice but it's not worth paying something)

So what I understand is that im better doing my own index fund, even Tangerine will not improve my situation.

I saw on http://canadiancouchpotato.com/recommended-funds/ that I have to create an account at TD to have index funds. Is it the only bank that offer this at this price ?

So my plan should be open a account somewhere (probably TD) and buy index funds in approximatly the same ratio that Tangerine use for there Growth fund. Is that a good plan ?

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