Firm has announced plans to axe the deferred sales charge purchase option
In a recent news release, Investors Group has announced plans to remove the deferred sales charge (DSC) purchase option for its mutual funds effective on Jan. 1, 2017. There will also be a concurrent reduction in fees on no-load funds.
“Effective January 1, 2017, the DSC purchase option of Investors Group's funds will be closed to all new lump sum investments… The DSC purchase option will continue to be available for pre-authorized contribution plans established before Jan. 1, 2017 until on or about June 30, 2017,” said a background document that accompanied the release.
The same document clarified that the DSC purchase option will still be available for certain reinvestment transactions as well as switches from existing assets obtained under the DSC purchase option.
“DSC was created to provide discipline to long term investing but the marketplace has evolved,” said Investors Group President and CEO Jeffrey R. Carney. “We remain confident that our comprehensive approach to financial planning will continue to encourage positive outcomes for clients.”
As for the fee reductions, the release announced that they will be applied to a majority of the firm’s mutual funds starting in 2017. The reduction applied will be between four and 10 basis points, translating into a weighted average of approximately eight bps on annualized fees for $11.4 billion in assets under management within affected no-load series.
The no-load purchase option changes apply to series B, B-RDSP, TNL, JNL, TJNL, U, and TU mutual funds. Service fee refund eligibility for the no-load purchase option of series C and TC funds will be aligned with the DSC purchase option of those series.
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“Effective January 1, 2017, the DSC purchase option of Investors Group's funds will be closed to all new lump sum investments… The DSC purchase option will continue to be available for pre-authorized contribution plans established before Jan. 1, 2017 until on or about June 30, 2017,” said a background document that accompanied the release.
The same document clarified that the DSC purchase option will still be available for certain reinvestment transactions as well as switches from existing assets obtained under the DSC purchase option.
“DSC was created to provide discipline to long term investing but the marketplace has evolved,” said Investors Group President and CEO Jeffrey R. Carney. “We remain confident that our comprehensive approach to financial planning will continue to encourage positive outcomes for clients.”
As for the fee reductions, the release announced that they will be applied to a majority of the firm’s mutual funds starting in 2017. The reduction applied will be between four and 10 basis points, translating into a weighted average of approximately eight bps on annualized fees for $11.4 billion in assets under management within affected no-load series.
The no-load purchase option changes apply to series B, B-RDSP, TNL, JNL, TJNL, U, and TU mutual funds. Service fee refund eligibility for the no-load purchase option of series C and TC funds will be aligned with the DSC purchase option of those series.
Related stories:
Lawyer-turned-money manager emphasizes fiduciary duty
Investors Group announces changes in fees, risk rating
