Despite the growing popularity of ETFs and alternatives, mutual funds are still the backbone of many client portfolios
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The other advantages of third-party professional management are threefold: rebalancing strategies, out-of-country investment opportunities and liquidity. We don’t have to guess which sectors, markets or trends are prevalent at any given time because these managers take care of these issues. Also, investment opportunities outside of North America are accessed by mutual funds and ETFs.”
It’s not about product, price and performance, but about people, process and philosophy. Mutual funds are a part of the equation, with the added benefits during stages of the economic cycle that benefit from active management. Mutual funds do play a part – for taxation, diversification and liquidity
A major advantage of mutual funds is the ease of acquisition, whether lumpsum or regular contributions. Richard Thaler’s Nobel Prize-winning theory has proven that this is key to building wealth.
Features such as SWPs and capitalclass funds provide our retired clients with regular income streams in open accounts with tax-efficient income. These features are not easily replicated with other securities.”
