– I’m glad some people understand what I’ve been saying for years. The only
number that should matter when judging mutual funds is the net return to
you. If a mutual fund with a 2.5% management expense ratio returns 10% a
year after expenses and an ETF with a 0.5% MER gains just 8%, which would
you choose? Clearly, the mutual fund puts more money in your pocket than
the ETF, even if its costs are higher. This is not to suggest people should
ignore costs. However, judge them against returns before deciding.
Notes on RBC Select Conservative Portfolio
– I am putting all my RRSP into a RRIF to start in June 2017. My Royal Bank
planner says I should put it into RBC Select Conservative Portfolio as I
told him I want low risk. The money is in GICs right now. They will charge
me 1.8% (MER). Is this a good fund? – Gordon S.
– This portfolio invests in 25 Royal Bank and Phillips, Hager & North
mutual funds. It’s a global balanced fund with an emphasis on the fixed
income side (53.5% of assets). Performance is below average for a fund of
this type. The portfolio gained 4.1% in 2016 compared to 4.8% for the
category as a whole. The 5-year average annual compounded rate of return is
6.2% versus 6.8% for the group. The fund hasn’t lost money in any year
since 2009, but it isn’t completely safe. It dropped 13.8% in the 12 months
to the end of February 2009. Overall, I’d rate it as average for its type.
– Gordon Pape
is one of Canada’s best-known personal finance commentators and
investment experts. He is the publisher of
The Internet Wealth Builder and The Income Investornewsletter, which are available through the Building Wealth website.
Follow Gordon Pape on Twitter at
and on Facebook at
Notes and Disclaimer
© 2017 by The Fund Library. All rights reserved.
The foregoing is for general information purposes only and is the opinion
of the writer. Securities mentioned carry risk of loss, and no guarantee of
performance is made or implied. This information is not intended to provide
specific personalized advice including, without limitation, investment,
financial, legal, accounting, or tax advice. Always seek advice from your
own financial advisor before making investment decisions.