Investment Options

Mutual Funds

What is a mutual fund?

A mutual fund is an investment that pools money from many individuals and invests it according to stated objectives. Professional money managers make investment decisions on behalf of fund investors, buying and selling investments such as money market investments, bonds and stocks. When you purchase units of a mutual fund, you become a part owner of all the investments held by that fund.

For more information visit the TD Mutual Funds Website.

Why do people buy mutual funds?

For the average investor, mutual funds are a convenient and affordable way of gaining access to investments that would otherwise be available only to large institutions or the wealthy. Because they typically hold 50 to 100 different investments, mutual funds offer a degree of diversification that would be difficult to achieve on your own. These investments are selected by experienced professionals who devote themselves exclusively to tracking the markets, analyzing investments and implementing a consistent investment strategy.

What types of funds are available?

You can choose funds that invest in money market investments, bonds or stocks, both domestic and international. Some funds are broadly diversified, while others target a specific sector of the economy, such as energy, precious metals or science & technology. Others track a well-known index, such as the TSE 300 or Standard & Poor's (S&P) 500. While there are hundreds of choices, each mutual fund will fall into one of the three main asset classes: money market for safety, bonds and mortgages for income, or stocks for growth. Or, you can choose a balanced fund, which is actively managed to maintain a mix of all three asset classes.

Who should buy mutual funds?

Mutual funds have a place in almost any portfolio. They offer a range of investment objectives that can satisfy a variety of investment needs from establishing an emergency reserve to saving for a vacation, a down payment on a house, education or retirement. Depending on your financial circumstances and tolerance for risk, there is likely a mutual fund or combination of funds that is right for you.

How much do I need to start?

Minimum initial investment is $1,000 for a regular investment account and $100 for RSP accounts. For TD Mutual Funds, the minimum initial investment is $1,000 for a regular investment account and $100 for a RSP account. The minimum subsequent investment is $100 for both types of accounts.

These minimum amounts are waived if you enrol in the Pre-Authorized Purchase Plan. Under the Plan, you can invest as little as $25 per Fund, automatically deducted from your bank account weekly, monthly, quarterly or on your pay day.

Transfers between Funds are free, however, a 2% early redemption fee is payable to all TD Sector, Global, Index(except Canadian Government Bond Index and International RSP Index), US Equity Funds and the TD Managed Assets Program if you transfer or sell units of these Funds within 90 days of purchase. The early redemption fee is paid to the Fund.

Where can I buy mutual funds?

You can open a TD Mutual Fund account and purchase TD Mutual Funds online. Alternatively you can speak to a registered representative over the phone, in a branch, or you can buy them directly through TD Waterhouse or through your financial planner.