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Segregated Funds
Mutual Funds





























































Segregated Funds

Pioneered by life insurers, segregated funds (known as seg funds) are now being popularized by their new purveyors, mutual fund companies.

The value of your interest in a seg fund--the key word being interest--is equivalent to your share of the securities owned by the insurer's seg fund. This gets credited in terms of a number of units much like a mutual fund. The difference is this: With seg fund policies, you own an interest in an investment portfolio as stated in an insurance policy contract. You pay premiums that "deposit" money into a seg fund policy that further invests in the seg fund. This is not quite the same as when you "purchase" mutual fund units and indirectly obtain "ownership" of securities held by a mutual fund. However, both mutual funds and seg funds offer the potential to either gain or in some cases lose capital.

Though the terminology and differences between a mutual fund and a seg fund policy seem superficial, there are five seg fund policy benefits worth noting:





Mutual Funds

A trust fund with investment advantages similar to those offered by present-day mutual funds actually existed in the 19th century in Great Britain. It promised the investor of modest means the same access to securities as the wealthier capitalist — access to stocks and bonds from many different companies. Beginning early in the 20th century, mutual funds achieved this by spreading an investment over a number of different stocks. We will look at the key principles that have inspired Canadian investors to hold approximately $400 billion in mutual funds today.

Minimum market anxiety.
Each fund has a knowledgeable portfolio manager or a team of managers that work full-time on the investor's behalf, with expertise in selecting suitable securities of many companies and/or governments. The average investor, who buys stocks and bonds, does not have the necessary time to assess securities, nor the expertise to make qualified investment decisions. Mutual funds allow the investor to effectively hire a fund manager to make these decisions. Managers possess training in market analysis, and have an understanding of economies. They work to assess the value of a company's stock, and develop an investment strategy that establishes buy and sell criteria, based on a rigid tactical discipline.


Mutual funds are not guaranteed, their values change frequently and past performance may not be repeated. Commissions, trailing commission, management fees and expenses may be associated with mutual fund investment. Please read the prospectus before investing. This is not intended to solicit business outside of the province of Ontario.