By Tom Bradley
In his column in the Report on Business the other week (How to Discuss Fees With Your Investment Adviser), Rob Carrick provided investors with a list of questions to ask their adviser about fees. In case any Steadyhand clients are interested in asking the questions, here are the answers.
1. Please explain how I’m paying you, and how much, both in percentage and dollar-value terms.
The total amount of fees paid to Steadyhand is shown on page 2 of your quarterly statement. It’s presented in both percentage terms and dollar and cents.
2. Please list what services you provide clients like me in exchange for fees charged.
- Professional management of your portfolio.
- Assistance filling in application and transfer forms.
- Oversight and scrutiny of the transfers from another institution to Steadyhand.
- Investment advice, specifically as it relates to portfolio construction and asset mix.
- Education materials.
- A steady hand.
3. Do I own any funds that carry ‘deferred sales charges’?
4. Are there other fees I’m paying beyond your MERs (management expense ratios)? Am I paying the fund manager separately?
No and no. Out of the MER we pay staff, fund managers, regulators and a whole host of service providers - lawyers, auditors, custodian, record-keeper, website host, landlord, etc.
The only costs that are not included in the MER are those related to buying and selling securities in the funds (i.e. trading commissions). These costs are calculated and published semi-annually in the Management Report of Fund Performance (MRFP). The trading expense ratios (or TERs) in 2013 for the Equity, Global Equity and Small-Cap Equity Funds were 0.04%, 0.18% and 0.23% respectively.
5. What annual administration fees am I paying? Am I paying an annual administration charge on my RRSPs and TFSAs?
6. What am I paying to buy or sell the funds?
Nothing - there are no commissions charged for transactions.
7. Please list the fees that apply if I withdraw money from a registered account of any type?
8. How much would your firm charge me to move my account to a different adviser?