Mutual funds disclosure
Each mutual fund has a Fund Facts document , which contains important information about the fund, including its investment objective, purchase options and applicable charges. Please read the Fund Facts document before investing.
Commissions, trailing commissions, management fees and expenses all may be associated with mutual fund investments. The indicated rates of return for the funds are the historical annual compounded total returns including changes in unit value and reinvestment of all distributions and do not take into account sales, redemption, distribution or other charges or income taxes payable by any investor that would have reduced returns.
Mutual funds are not guaranteed, their values change frequently and past performance may not be repeated. Mutual fund securities are not insured by the Canada Deposit Insurance Corporation or by any other government deposit insurer.
Quadrus charitable giving program disclosure
Commissions, trailing commissions, management fees and expenses all may be associated with mutual funds. A charitable administration fee and charitable operating expenses will also apply. Please read the Fund Facts before investing and the program guide before donating. Mutual funds are not guaranteed, their values change frequently and past performance may not be repeated. The information is general in nature and is not intended to be professional tax advice. Donations should not be made for tax considerations alone. Each donor's situation is unique and advice should be received from an investment representative.
Borrowing money tobuy securities (leveraging)
A purchase of securities with borrowed money involves greater risk than a purchase using cash only. The extent of that risk depends on the circumstances of the investor and the type of investment purchased. If cash is used to pay for the securities purchase in full, the percentage gain or loss on the investment will equal the percentage increase or decrease in the value of the securities. The purchase of securities using borrowed money magnifies the gain or loss on the cash invested. This effect is called leveraging.
An investor should also be aware of the terms of a loan used to purchase securities. The lender may require that the amount outstanding on the loan not rise above an agreed percentage of the market value of the securities. In these circumstances, the investor must pay down the loan or sell the securities to return the loan amount to the agreed percentage. If the investor does not have enough cash, the investor must sell securities, even at a loss, to provide money to reduce the loan.
Money is also required to pay interest on the loan. Investors who borrow money to purchase securities should have adequate financial resources available to pay interest and reduce the loan if necessary.
Risks of borrowing for purchasing investments
Mutual fund units and other securities may be purchased using available cash, or a combination of cash and borrowed money. If cash is used to pay for the purchase in full, the percentage gain or loss will equal the percentage increase or decrease in the value of the securities. The purchase of securities using borrowed money magnifies the gain or loss on the cash invested. This effect is called leveraging.
For example, if $100,000 of mutual fund units are purchased and paid for with $25,000 from available cash and $75,000 from borrowings, and the value of the fund units declines by 10 per cent to $90,000, your equity interest (the difference between the value of the securities and the amount borrowed) has declined by 40 per cent, i.e. from $25,000 to $15,000.
It is important that an investor proposing to borrow for the purchase of securities be aware that a purchase with borrowed monies involves greater risk than a purchase using cash resources only. To what extent a purchase using borrowed monies involves undue risk is a determination to be made by each purchaser and will vary depending on the circumstances of the purchaser and the securities purchased.
Financial resources required for investments purchased with borrowed funds
It is also important that the investor be aware of the terms of a loan secured by securities. The lender may require that the amount outstanding on the loan not rise above an agreed percentage of the market value of the securities. Should this occur, the borrower must pay down the loan or sell the securities so as to return the loan to the agreed percentage relationship. In our example above, the lender may require that the loan not exceed 75 per cent of the market value of the mutual fund units. On a decline of value of the units to $90,000 the borrower must reduce the loan to $67,500 (75 per cent of $90,000). If the borrower does not have cash available, the borrower must sell units at a loss to provide money to reduce the loan.
Money is, of course, also required to pay interest on the loan. Under these circumstances, investors who use borrowed funds to purchase their investment are advised to have adequate financial resources available both to pay interest and also to reduce the loan if the borrowing arrangements require such a payment.
Views expressed regarding a particular company, security, industry or market sector are the views of only that speaker or author as of the time expressed and do not necessarily represent the views of Quadrus Investment Services Ltd. Any such views are subject to change at any time based upon markets and other conditions. Quadrus disclaims any responsibility to update such views. These views are not a recommendation to buy or sell and may not be relied on as investment advice and, because investment decisions for mutual funds are based on numerous factors, may not be relied on as an indication of trading intent on behalf of any such fund.
Speculation or stated beliefs about future events, such as market and economic conditions, company or security performance, upcoming product offerings or other projections are “forward-looking statements.” These forward-looking statements represent the beliefs of the speaker or author and do not necessarily represent the views of Quadrus. General business, market, economic and political conditions could cause actual results to differ materially from what the speaker or author presently anticipates or projects.
This or other linked websites may contain forward-looking statements that reflect current expectations or forecasts of future events. Forward-looking statements include statements that are predictive in nature, depend upon or refer to future events or conditions, or include words such as “expects”, “anticipates”, “intends”, “plans”, “believes”, “estimates”, “preliminary”, “typical” and other similar expressions. In addition, these statements may relate to future corporate actions, future financial performance of a fund or a security and their future investment strategies and prospects. Forward-looking statements are inherently subject to, among other things, risks, uncertainties and assumptions that could cause actual events, results, performance or prospects to differ materially from those expressed in, or implied by, these forward-looking statements. These risks, uncertainties and assumptions include, without limitation, general economic, political and market factors in North America and internationally, interest and foreign exchange rates, the volatility of global equity and capital markets, business competition, technological change, changes in government regulations, changes in tax laws, unexpected judicial or regulatory proceedings, catastrophic events and the ability of the company that is the subject of these statements to attract or retain key employees. The foregoing list of important risks, uncertainties and assumptions is not exhaustive. Please consider these and other factors carefully and do not place undue reliance on forward-looking statements.
The forward-looking information contained on this or other linked websites is current only as of the date the statement was made. There should not be an expectation that such information will in all circumstances be updated, supplemented or revised whether as a result of new information, changing circumstances, future events or otherwise.
Quadrus products and services are only offered in jurisdictions where they may be lawfully offered for sale. All products and services are subject to the terms of each and every applicable agreement. It is important to note that not all products, services and information are available in all jurisdictions outside Canada. This site should not be considered an offer to sell or solicitation to buy any investment fund or other product, service or information to anyone in any jurisdiction in which an offer or solicitation is not authorized or cannot be legally made or to any person to whom it is unlawful to make an offer or solicitation. Prospective investors who are not resident in Canada should consult with their investment representative to determine whether these products and services may be lawfully sold in their jurisdiction.
What you need to know about your relationship with Quadrus
Your investment representative works with Quadrus, your mutual fund dealer, to make sure you have the information you need to be an informed investor. We take this responsibility seriously and appreciate the trust you’ve put in us.
Please select the appropriate link to review What you need to know about your relationship with Quadrus. You’ll also find details on service levels and fees. These differ depending on your investment representative’s relationship with Quadrus.
- Click here if you work with an independent Quadrus investment representative - PDF 804 kb
- Click here if you work with a Financial Solutions Centre investment representative - PDF 159 kb
And if you have questions, your investment representative is ready to help.