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Merry Xmas everyone. Ridgewood has just issued an investment grade bond fund. Our advisor is recommending it. Any opinions?
 

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what is the yield and what is the MER? I find that most mutual funds in the bond sector these days have MERs that eat almost all the yield.

If you have enough cash to buy ETFs and not have the commissions turn your trades into the equiv. of high MER mutual funds, then bond ETFs are a good option IMO. There are several short term laddered bond ETFs out there that have quite low MERs.
 

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Merry Xmas everyone. Ridgewood has just issued an investment grade bond fund. Our advisor is recommending it. Any opinions?
No real opinions. The prospectus shows that, once the offering closes, the only fees are a management fee of 0.5% and operating expenses which look like they might range from 0.25-0.4% annually. With GST, total costs might be around 1% or a bit below. Its regular bond mutual fund carries fees of just over 1% and it has underperformed the bond index by less than its fees (which means it outperformed before fees) over ten years.

The fund can use leverage of up to 25% of assets and it will use close to all of that (20%) at the fund's inception. Ridgewood used to be called Mulvihill, which was born out of the old Canada Trust years ago (mid-1980s?). They're not great on stock funds but they seem to have done a decent job on the bond side (kind of funny for a firm that really has its roots in equity management).

So, this doesn't look bad but can't say if YOU should invest in it. No huge warning signs emerged. The only thing is that fees might be more than you'd want to pay - since you can buy XCB for 40 basis points - but other than that, this looks okay at first blush.
 

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From the newswire:

Ridgewood Capital Asset Management Inc. announces result of adjourned special meeting of Ridgewood Canadian Bond Fund.

TORONTO, March 25 /CNW/ - Ridgewood Capital Asset Management Inc., the manager and trustee of Ridgewood Canadian Bond Fund (the "Fund"), announced today that at a special meeting of the Fund, unitholders approved a change in investment objective of the Fund. In accordance with the new investment objective, the Fund will now be permitted to invest in corporate bonds with a minimum rating of "BBB" (or its equivalent), rather than "A". The change will take effect after the close of business today.

For further information: John H. Simpson, C.F.A., Managing Director, Ridgewood Capital Asset Management Inc., (416) 479-2751
 
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