MER , Management Fees , Trailer Fees

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Shakespeare
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Post by Shakespeare »

index- it's a lot easier.
But..but....then how could I outperform? :shock:

[By far the majority of investors don't understand the rationale for indexing - and, given the massive amounts of money the industry spends on marketing, they never will.]
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yielder
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Post by yielder »

parvus wrote:skin
Proxy circulars have pictures? :shock: :lol:
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Post by parvus »

I'll have to check out SmallInvestorActivist's annual report and filings. Maybe he's got more than one corporate secretary. :shock:
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Jo Anne
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Post by Jo Anne »

yielder wrote:But I want it to be eeeeeeeeeeeaaaaaaaaaasssssssssssyyyyyyyyyyyy. Why do you all want me to phone fund companies? Why do you all want me to poke around in Sedar? What is all this stuff?
Mike, I just went to Sedar and looked up BMO Dividend Fund, which is one that I own. I read through the Simplified Prospectus and the Interim Financial Statements.

I couldn't find a TER in either of these reports. Where is it located?
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yielder
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Post by yielder »

Jo Anne wrote:
yielder wrote:But I want it to be eeeeeeeeeeeaaaaaaaaaasssssssssssyyyyyyyyyyyy. Why do you all want me to phone fund companies? Why do you all want me to poke around in Sedar? What is all this stuff?
Mike, I just went to Sedar and looked up BMO Dividend Fund, which is one that I own. I read through the Simplified Prospectus and the Interim Financial Statements.

I couldn't find a TER in either of these reports. Where is it located?
http://www.financialwisdomforum.org/for ... 953#134953
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Post by YogiBear »

Jo Anne wrote:BMO Dividend Fund ... the Simplified Prospectus and the Interim Financial Statements.

I couldn't find a TER in either of these reports. Where is it located?
Go to the source: The Management Report of Fund Performance list for BMO Mutual Funds, and choose BMO Dividend Fund from the pull-down menu entitled "Semi-Annual Management Report of Fund Performance (March 31, 2006)".

Look on page 3 of the resulting pdf document under "Ratios and Supplemental Data": for the 6 months ending March 31, 2006, the TER was (annualized) 0.04%.

As a general rule, I find it is quicker to get any documents I need from fund company websites rather than Sedar, so long as I know what I am looking for (I am not a BMO unitholder, yet I found the relevant document in less than a minute).
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Post by Money101 »

Norm:
You are evidently a fund buyer who doesn't know what they are buying. You are unwilling to read the available fund documentation or phone the fund company to get your questions answered. If you had an advisor then you could simply ask them.


NormR, you keep avoiding the issue - Disclosure should be better.
I have read documentation I am aware of and to the best of my ability. I even had to call my company months ago to get my MERS.

NormR:
I've led you to the water, you do not want to drink. The information you want is easily available and would likely take less time to compile than you've already spent on this thread alone.


No you have not.
It shouldn't be this difficult to learn about my costs and what they are. It is NOT easily available and easy to understand.

Those who read highly technical academic articles in finance get a condescending tone when they are apparently unwilling to read basic fund documents concerning their own investments.

Wrong again. You are assuming that I am unwilling and have not read my basic fund documents. Please stop assuming. I had to do much more just to learn basic costs. Disclosure can be much better.

JoAnne just proved my point (again):

Mike, I just went to Sedar and looked up BMO Dividend Fund, which is one that I own. I read through the Simplified Prospectus and the Interim Financial Statements.

I couldn't find a TER in either of these reports. Where is it located?
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Post by Jo Anne »

yielder wrote:
Jo Anne wrote: I couldn't find a TER in either of these reports. Where is it located?
http://www.financialwisdomforum.org/for ... 953#134953
Mike, I didn't want to know what the TER was. I wanted to know how to easily locate it.
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Post by Jo Anne »

YogiBear wrote: Go to the source: The Management Report of Fund Performance list for BMO Mutual Funds, and choose BMO Dividend Fund from the pull-down menu entitled "Semi-Annual Management Report of Fund Performance (March 31, 2006)".

Look on page 3 of the resulting pdf document under "Ratios and Supplemental Data": for the 6 months ending March 31, 2006, the TER was (annualized) 0.04%.

As a general rule, I find it is quicker to get any documents I need from fund company websites rather than Sedar, so long as I know what I am looking for (I am not a BMO unitholder, yet I found the relevant document in less than a minute).
I went to the source - bmo.com - and wandered through the various links and options available. It took a while, but I finally found the link you referenced above. I hate to think how long it would have taken if I hadn't know what I was looking for.

By the way - BMO mutual funds has a "glossery of terms" page. It does not contain any reference to a TER, though it does mention MERs.
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Post by Rip »

Money101

With respect, as a casual observer of this debate one could make the case that either you are a) not reading the responses or b) intentionally trying to make this more difficult than it actually is.

The document you want is called the "Management Report of Fund Performance"(as per Yogi's post). I just went to Sedar, located the document, found the data in question, and came back here, all in under 2 minutes.
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Post by Rip »

Money 101,

I may have misspoken, the result of misreading your post in which you were quoting Joanne. My apologies.
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Post by saylavbda »

Money101,

How did you buy your mutual funds? Was there an FA involved?
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Post by Dennis »

Is it possible that what we really want here is for Morningstar and the newspapers to start listing the TER (like they do the MER) so that easy comparisons between funds may be made?
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Post by NormR »

Money101 wrote:Norm:
You are evidently a fund buyer who doesn't know what they are buying. You are unwilling to read the available fund documentation or phone the fund company to get your questions answered. If you had an advisor then you could simply ask them.


NormR, you keep avoiding the issue - Disclosure should be better.
I have read documentation I am aware of and to the best of my ability. I even had to call my company months ago to get my MERS.
Well we'll have to agree to disagree. You have all of the tools you need to figure out your fund costs.

If you have a genuine question about how to find or interpret such costs, I'm sure that you'll have it answered on this forum.
Money101 wrote: NormR:
I've led you to the water, you do not want to drink. The information you want is easily available and would likely take less time to compile than you've already spent on this thread alone.


No you have not.
It shouldn't be this difficult to learn about my costs and what they are. It is NOT easily available and easy to understand.
I'm sorry to say, but if you think that it is difficult then you probably shouldn't be a DIY investor. Lord help you if you start buying stocks.
Money101 wrote: Those who read highly technical academic articles in finance get a condescending tone when they are apparently unwilling to read basic fund documents concerning their own investments.

Wrong again. You are assuming that I am unwilling and have not read my basic fund documents.
Ok then, you don't seem to understand them. Again, just ask for help in interpretation and many will lend a hand in the effort.
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Post by saylavbda »

NormR wrote:Well we'll have to agree to disagree. You have all of the tools you need to figure out your fund costs.
Technically, he has the tools to find the costs of the fund he's invested in, but not his costs as he may or may not have been in for the whole year. But given a percentage, one could work out an estimate of the costs.

I noticed that the TER percentage is a new one on the disclosure, too bad they don't calculated it back so one could see if they is trend in the cost either increasing/decreasing or remaining constaint.
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NormR
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Post by NormR »

Dennis wrote:Is it possible that what we really want here is for Morningstar and the newspapers to start listing the TER (like they do the MER) so that easy comparisons between funds may be made?
That'd be nice and I expect that the data guys to add it in over time. A combined MER and TER figure would also make sorting easier. :)

On the other hand, those who are worried about such things can find a short list of low fee (active or passive) funds quickly. TER is generally a small fraction of the MER for lower fee funds. About 13 bp for a small group of active equity funds that I follow vs a MER of 145 bp. Passive funds tend to be even lower.

If you're interested in low fee funds, sort by MER and pick off a small low fee list. Then look up the TER (and turnover while you're at it).
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NormR
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Post by NormR »

saylavbda wrote:
NormR wrote:Well we'll have to agree to disagree. You have all of the tools you need to figure out your fund costs.
Technically, he has the tools to find the costs of the fund he's invested in, but not his costs as he may or may not have been in for the whole year. But given a percentage, one could work out an estimate of the costs.
Hair splitting, you also don't know in advance what the costs will be over the next year (or fraction thereof). Those zany managers often trade at different rates each year. Go figure.
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Post by Bylo Selhi »

NormR wrote:A combined MER and TER figure would also make sorting easier. :)
Hmmm... I would have thought that for you that would be a trivial exercise; a line or two of code at the most. Careful that you don't come across as a whiner ;)
NormR wrote:Hair splitting, you also don't know in advance what the costs will be over the next year (or fraction thereof). Those zany managers often trade at different rates each year. Go figure.
Yup. Which is yet another reason why the usual data providers should be reporting TERs and why the fundcos/dealers should be reporting the actual dollar costs of MERs and TERs on customer account statements.
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Post by yielder »

NormR wrote:That'd be nice and I expect that the data guys to add it in over time. A combined MER and TER figure would also make sorting easier. :)
What's this easier nonsense? :P Now you're starting to sound like me. Next thing, you'll be saying that CI, Hancock, Royce are investor friendly, BMO, BNS & RBC are sort of friendly, TDAM doesn't know the word friendly and IGM is a mind boggling . Between A, B, C, DSC, NL, TC no wonder you buy IGM products through an IGM salesman.

Speaking of investor friendly, isn't that good business especially in a highly, highly competitive business where marketing is as important as performance.
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NormR
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Post by NormR »

Bylo Selhi wrote:
NormR wrote:A combined MER and TER figure would also make sorting easier. :)
Hmmm... I would have thought that for you that would be a trivial exercise; a line or two of code at the most. Careful that you don't come across as a whiner ;)
I've written my code. So, sorting is no problem for me :)
Bylo Selhi wrote:
NormR wrote:Hair splitting, you also don't know in advance what the costs will be over the next year (or fraction thereof). Those zany managers often trade at different rates each year. Go figure.
Yup. Which is yet another reason why the usual data providers should be reporting TERs and why the fundcos/dealers should be reporting the actual dollar costs of MERs and TERs on customer account statements.
All for an extra 10 bp to please non-fund investors ... the feature for the next issue will be "funds cost too much in Canada".
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Post by NormR »

yielder wrote:
NormR wrote:That'd be nice and I expect that the data guys to add it in over time. A combined MER and TER figure would also make sorting easier. :)
What's this easier nonsense? :P Now you're starting to sound like me. Next thing, you'll be saying that CI, Hancock, Royce are investor friendly, BMO, BNS & RBC are sort of friendly, TDAM doesn't know the word friendly and IGM is a mind boggling . Between A, B, C, DSC, NL, TC no wonder you buy IGM products through an IGM salesman.

Speaking of investor friendly, isn't that good business especially in a highly, highly competitive business where marketing is as important as performance.
Where's that conflict of interest disclosure. Doing a little pumping? :wink:

Ya'all seem to be missing the point that I don't mind more disclosure (my conflict of interest is for much more fee disclosure). It is the 'not reading the fund documents' part that I seriously disagree with.
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Post by Money101 »

NormR:
Well we'll have to agree to disagree. You have all of the tools you need to figure out your fund costs.

If you have a genuine question about how to find or interpret such costs, I'm sure that you'll have it answered on this forum.


I shouldn't have to "figure out" or "interpret" costs - they should be indicated and disclosed to me clearly in the my statements.

AGAIN -WHY NOT REPORT THEM, ALONG WITH MY RATES OF RETURNS, UNIT PURCHASES ETC?

We'll agree to disagree and you not answering my question.


NormR
I'm sorry to say, but if you think that it is difficult then you probably shouldn't be a DIY investor. Lord help you if you start buying stocks.


That's why I am trying to learn about all the hidden costs due to poor disclosure. I am investing through a FA/salesman currently.
Compounding is "the greatest mathematical discovery of all time." - Einstein
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Post by Money101 »

yielder wrote: Speaking of investor friendly, isn't that good business especially in a highly, highly competitive business where marketing is as important as performance.
Yes, it would be considered good business.

OK, enough talk of this investor friendly nonsense!. :wink:
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Post by NormR »

Money101 wrote:NormR:
Well we'll have to agree to disagree. You have all of the tools you need to figure out your fund costs.

If you have a genuine question about how to find or interpret such costs, I'm sure that you'll have it answered on this forum.


I shouldn't have to "figure out" or "interpret" costs - they should be indicated and disclosed to me clearly in the my statements.

AGAIN -WHY NOT REPORT THEM, ALONG WITH MY RATES OF RETURNS, UNIT PURCHASES ETC?

We'll agree to disagree and you not answering my question.
I'm not your portfolio manager, nor your advisor. Ask them. If you are dissatisfied with the service provided then swap funds/advisors. Just expect to pay extra for the added level of attention that you're likely to demand.
Money101 wrote: NormR
I'm sorry to say, but if you think that it is difficult then you probably shouldn't be a DIY investor. Lord help you if you start buying stocks.


That's why I am trying to learn about all the hidden costs due to poor disclosure. I am investing through a FA/salesman currently.
Ask your advisor. If you don't get a good answer, get a new advisor. Read the latest issue of MoneySense for a good article on looking for an advisor. I'd link to it but it has yet to appear online.
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Post by YogiBear »

Money101 wrote:
NormR wrote:I'm sorry to say, but if you think that it is difficult then you probably shouldn't be a DIY investor. Lord help you if you start buying stocks.
That's why I am trying to learn about all the hidden costs due to poor disclosure. I am investing through a FA/salesman currently. [emphasis added]
Good that you use a FA- and if your attitude to tax filing is the same as it is to investing, I hope that you use H&R Block for your income tax return as well.

The costs that concern you are not "hidden", they are openly revealed in the "Management Report of Fund Performance", a public semi-annual document that you can obtain several ways, depending on your preferences.

If your preferences tend towards passive bitching rather than active learning, however, unfortunately there is little that anybody will ever do that will satisfy you- so why bother ...

I repeat what I said upthread- if you can successfully fill out your annual obligation to the Canada Revenue Agency, you can understand the information on fund costs provided by your fund company in the MRFP.
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