TD e-series managed funds

6243 Views 6 Replies 6 Participants Last post by John_Michaels, Dec 14, 2009

2216

Discussion Starter · Dec 11, 2009

I’m interested in an indexing approach by using the TD e-series funds for a portion of my RSP. I have looked at purchasing iShares ETFs within a discount brokerage. However, as I don’t have a lot of money in the RSP; and as I’m planning on contributing small amounts monthly, I think TD e-series funds is the most cost-effective approach now.

As my horizon is very long-term (30 years+), I can have an aggressive mix. I’m thinking about splitting the money in thirds (and rebalance when needed) across Canadian Equity (MER 0.31), US Equity (MER 0.33) and International Equity (MER 0.44).

However, I also saw that TD have e-series managed funds (e.g., TD Managed Index Maximum Equity Growth with MER of 1.37%); which seems to be similar to my proposed mix.

Wondering if I should stick with the split of three, or pay the higher MER for one simple fund that is balanced automatically. In other words, are the e-series managed funds worth it? Opinions?

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HaroldCrump

· #2 · Dec 11, 2009

2216 said:
However, I also saw that TD have e-series managed funds (e.g., TD Managed Index Maximum Equity Growth with MER of 1.37%); which seems to be similar to my proposed mix.

Wondering if I should stick with the split of three, or pay the higher MER for one simple fund that is balanced automatically. In other words, are the e-series managed funds worth it?

No, in my opinion.
The fees are a full 1% more than eSeries.
Manual balancing costs you no fees and very little time (if you do once a year or twice a year).
If you wish to change the allocation % between the 3 funds, you can do it easily and without fees.
Why would you bog yourself down into another "managed" fund and defeat the purpose of passive indexing?
The only time you'll incur fees with eSeries is if you sell your position within 90 days of buying (check exact number of days on their website).

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