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Many Canadians turning to do-it-yourself investing since onset of the pandemic – insauga.com

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Has the recent hype involving the stock market inspired you to start investing yourself?

In response to more than two million do-it-yourself (DIY) investment accounts that were opened by Canadians in 2020, the Investment Industry Regulatory Organization of Canada (IIROC) re-issued information to help investors make informed decisions.

According to Investor Economics, a financial services research firm, there was more than double the number of Canadians who opened gross new accounts in 2020–2.3 million–compared to 2019–846,000.

Additionally, from March 2020 and January 2021, there was a significant spike in the number of complaints to IIROC–DIY investors’ inquiries and complaints were up 270 per cent from March 2020 to January 2021 compared to that same period during 2019.

Further, the IIROC reminds investors capital markets are affected by numerous factors, which may result in volatility that could lead to gains as well as loss.

The agency, therefore, suggests DIY investing only for those who have ample knowledge and information, and who are comfortable making their own decisions, without financial advice.

“We urge investors to be careful about where they are getting their investing information, as many sources are unregulated and may contain inaccurate information,” Lucy Becker, vice-president of Public Affairs and Member Education Services for the IIROC, said in a news release.

“This may lead to misinterpreting investment research and subsequently betting the farm,” she continued.

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Investment funds increase pressure on Danone CEO – TheChronicleHerald.ca

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PARIS (Reuters) – U.S. investment company Artisan Partners joined activist investor Bluebell Capital Partners on Friday in demanding that French food group Danone finds a new chief executive.

Chairman and Chief Executive Emmanuel Faber has come under growing pressure as activist shareholders push for management changes to lift returns that have lagged those of some rivals during the COVID-19 pandemic.

Artisan, which has built a 3% stake in Danone, called for a split in the roles of CEO and chairman, also echoing Bluebell’s demands.

“The roles of CEO and chairman should be split to reflectmodern-day corporate governance. Governance standards also require that prior leadership leave the board. And logic demands more consumer goods experience on the board of directors,” wrote Artisan.

“A new, non-financial CEO with consumer goods experience and a track record of success should be installed as soon as possible to restore Danone to the elevated status it deserves within the French business establishment.”

Artisan has previously urged the maker of Activa yoghurt to sell its underperforming brands, such as Asian water label Mizone.

In recent months Faber had intensified action to ward off activist investors, announcing in November a plan to cut 2,000 jobs, trim product ranges and sell some assets, including the group’s business in Argentina and its Vega plant-based brand.

(Reporting by Sudip Kar-Gupta and Benoit Van Overstraeten; Editing by David Goodman)

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This investment mix beats the S&P 500 — by a mile – MarketWatch

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This article is the core of my best advice for long-term investors. If you want the very best equity portfolio, you’re about to learn what it is and how to put it together.

This article has three parts. The first is what might be called an “executive summary” of key points. The second outlines the step-by-step process of creating my recommended portfolio. The third digs deeper into a few related topics.

This is one of a series of articles I’ve written and updated annually for many years. Together, they outline a lifetime wealth accumulation strategy for do-it-yourself investors.

The other articles will tackle how to accumulate investment savings, how much to hold in bonds, and how to plan retirement withdrawals.

Part one

“Ultimate” isn’t a term to toss around lightly. But in the case of the ultimate buy-and-hold strategy, it fits. I believe this is the absolute best way for most investors to achieve long-term growth in the stock markets.

This strategy is based on the best academic research I can find — and it is the basis of most of my own investments.

Here are some key takeaways:

Because nobody can know the future of investment returns, massive diversification gives investors the highest probability for long-term success.

Most investors rely almost exclusively on the S&P 500
SPX,
-2.45%
.
But by adding equal portions of nine other equity asset classes, long-term investors can double or even triple their returns.

The additional return comes primarily from taking advantage of long-term favorable returns of value stocks and small-cap stocks. Taking this step involves only minimal additional risk.

The ultimate buy-and-hold portfolio works best for investors who don’t want or try to predict the future, time the market’s inevitable swings or pick individual stocks.

By investing in passively managed index funds or exchange-traded funds, this strategy offers investors a convenient, low-cost way to own thousands of stocks.

Read: Will Social Security still be there if I wait to claim it?

Part two

This “ultimate” all-equity portfolio automatically takes advantage of stock-market opportunities wherever they are.

It’s best to roll this out in steps so you can see how it goes together. To help you follow along, here’s a table showing the components.

The base “ingredient” in this portfolio is the S&P 500, which is a good investment by itself. For the past 51 calendar years, from 1970 through 2020, the S&P 500 compounded at 10.7%. An initial investment of $100,000 in 1970 would have grown to nearly $18 million by the end of 2020. Keep that figure in mind as a benchmark to see the results of the diversification I’m about to describe.

For the sake of our discussion, think of the S&P 500 index as Portfolio 1.

The next step involves shifting 10% of your portfolio from the S&P 500 to large-cap value stocks, which are regarded as relatively underpriced (hence the term value).

This results in Portfolio 2, which is still 90% in the S&P 500. Assuming annual rebalancing (an assumption that applies throughout this discussion), the 51-year compound return rises from 10.7% to 10.9%. That would turn $100,000 investment in 1970 into $19.4 million.

In dollars, this simple step adds nearly 15 times the amount of your entire original investment of $100,000 — the result of changing only one-tenth of the portfolio. If that’s not enough to convince you of the power of diversification, keep reading.

Read: We want to scale back to an up-and-coming town out West where we can retire — where should we go?

In Portfolio 3, we move another 10% into U.S. small-cap blend stocks, decreasing the weight of the S&P 500 to 80%.

This boosts the 51-year compound return to 11%; an initial $100,000 investment would grow to $20.7 million — an increase of nearly $2.8 million from Portfolio 1.

To create Portfolio 4, we move 10% of the portfolio into U.S. small-cap value stocks, reducing the weight of the S&P 500 to 70%. Small-cap value stocks historically have been the most productive of all major U.S. asset classes, and they boost the compound return to 11.4%, enough to turn that initial $100,000 investment into $24.4 million — with more than two-thirds of the portfolio still in the S&P 500.

Read: Is COVID-19 a preview of what retirement will be like?

To continue diversifying, we create Portfolio 5 by shifting another 10% into U.S. REITs funds. Result: a compound return of 11.4% and an ending cash value of just under $25 million.

I understand that many investors are uncomfortable with international equities. But I believe any portfolio worth being described as “ultimate” must venture beyond the U.S. borders.

Accordingly, to create Portfolio 6, we shift another 40% of the portfolio to four more important asset classes: international large-cap blend stocks, international large-cap value stocks, international small-cap blend stocks and international small-cap value stocks.

This reduces the influence of the S&P 500 to 20%. The result is a compound return of 12% and a 51-year portfolio value of $32.4 million — an increase of 81% over the S&P 500 by itself.

The final step, Portfolio 7, comes from adding 10% in emerging markets stocks, representing countries with expanding economies and prospects for rapid growth.

This boosts the compound return to 12.4% and a final value of $34.4 million.

This massively diversified 10-part portfolio is as far removed as possible from any effort to predict the future. Over 51 calendar years, it met all the asset-class predictions of academic researchers—and more than doubled the dollar return of the S&P 500.

Here are my specific recommendations:

Asset class

Recommended ETF (ticker)

Standard & Poor’s 500 Index

AVUS

U.S. large-cap value

RPV

U.S. small-cap blend

IJR

U.S. small-cap value

AVUV

U.S. real-estate investment trusts

VNQ

International large blend

AVDE

International large-cap value

EFV

International small-cap blend

FNDC

International small-cap value

AVDV

Emerging markets

AVEM

Unfortunately, this portfolio has an important drawback: It requires owning and periodically rebalancing 10 component parts. Relatively few investors have the time or inclination to do that.

Fortunately, we have devised a four-fund alternative that’s much easier to implement.

Since 1970, this “lite” version of the ultimate buy and hold strategy would have produced virtually the same compound return, dollar return and standard deviation as the 10-fund portfolio I outlined above.

In an upcoming article, I’ll roll out this new version.

Part three

It won’t surprise you to learn that there’s much more to say about this portfolio.

In 2020, we recalculated results from the 1970s to reflect new data we did not have in previous years. We also changed our assumptions about fund expenses that investors would have been charge in the 1970s. We believe our recalculations will better reflect what 21st century investors can reasonably expect.

Yet even after all these calculations, the returns did not change materially, and there’s no change in my beliefs or recommendations.

This updated data is as good as I can make it.

To learn more about these changes as well as some other reasons I think so highly of this portfolio, I hope you’ll tune in to my latest podcast.

Richard Buck contributed to this article.

Paul Merriman and Richard Buck are the authors of We’re Talking Millions! 12 Simple Ways To Supercharge Your Retirement.

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Manulife Investment Management Announces Reduction of Management Fees on Three Mutual Funds and Three Upcoming Fund Terminations – Canada NewsWire

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C$ unless otherwise stated                                            TSX/NYSE/PSE: MFC     SEHK: 945

TORONTO, Feb. 25, 2021 /CNW/ – Manulife Investment Management announces a reduction of management fees on three global equity funds and the termination of three mutual funds. These changes will help streamline our platform of actively managed investments and further our commitment to offering diverse, strong-performing products to help investors achieve their goals.

Reduction of Management Fees

A reduction of management fees on the following series of three mutual funds will be effective on or about March 1, 2021:

Fund Name

Series

Existing Management Fee (%)

New Management Fee (%)

Manulife Global Equity Class

Advisor Series/ Series T

1.95%

1.82%

Series F/Series FT

0.85%

0.72%

Manulife Global Thematic Opportunities Fund

Advisor Series/ Series T

1.95%

1.82%

Series F/Series FT

0.85%

0.72%

Manulife Global Thematic Opportunities Class

Advisor Series/ Series T

2.00%

1.87%

Series F/Series FT

0.90%

0.77%

It is expected that the reduction in management fees should have a corresponding impact on the management expense ratio of the funds over time.

“Delivering the best value possible to Canadian investors is a priority for us,” said Leo Zerilli, Head of Wealth and Asset Management, Canada. “Our team constantly monitors our fund lineup and identified an opportunity to improve our pricing on certain products within the global equity category.”

Fund Terminations

Effective on or about June 28, 2021, Manulife Investment Management will terminate the following funds and distribute the proceeds to securityholders of record on that date. The planned terminations include:

  • Manulife Fundamental Dividend Class
  • Manulife Global Dividend Growth Class
  • Manulife Global Real Estate Unconstrained Fund

Prospectus qualified securities of the terminating funds will no longer be available for new purchases effective as of 4 p.m. ET on March 3, 2021. This includes purchases through automatic investment services such as pre-authorized chequing plans or automatic rebalancing services. Impacted investors are encouraged to contact their advisor to discuss the financial and tax implications of these fund changes and to discuss options, including how to switch their assets to another Manulife mutual fund that best meets their individual investment needs and circumstances prior to the termination date.

About Manulife Investment Management

Manulife Investment Management is the global wealth and asset management segment of Manulife Financial Corporation. We draw on more than a century of financial stewardship and the full resources of our parent company to serve individuals, institutions, and retirement plan members worldwide. Headquartered in Toronto, our leading capabilities in public and private markets are strengthened by an investment footprint that spans 17 countries and territories. We complement these capabilities by providing access to a network of unaffiliated asset managers from around the world. We’re committed to investing responsibly across our businesses. We develop innovative global frameworks for sustainable investing, collaboratively engage with companies in our securities portfolios, and maintain a high standard of stewardship where we own and operate assets, and we believe in supporting financial well-being through our workplace retirement plans. Today, plan sponsors around the world rely on our retirement plan administration and investment expertise to help their employees plan for, save for, and live a better retirement. 

As of December 31, 2020, Manulife Investment Management had CAD$966 billion (US$758 billion) in assets under management and administration. Not all offerings are available in all jurisdictions. For additional information, please visit manulifeim.com.

About Manulife
Manulife Financial Corporation is a leading international financial services group that helps people make their decisions easier and lives better. With our global headquarters in Toronto, Canada, we operate as Manulife across our offices in Canada, Asia, and Europe, and primarily as John Hancock in the United States. We provide financial advice, insurance, and wealth and asset management solutions for individuals, groups and institutions. At the end of 2020, we had more than 37,000 employees, over 118,000 agents, and thousands of distribution partners, serving over 30 million customers. As of December 31, 2020, we had $1.3 trillion (US$1.0 trillion) in assets under management and administration, and in the previous 12 months we made $31.6 billion in payments to our customers. Our principal operations are in Asia, Canada and the United States where we have served customers for more than 155 years. We trade as ‘MFC’ on the Toronto, New York, and the Philippine stock exchanges and under ‘945’ in Hong Kong.

SOURCE Manulife Investment Management

For further information: Media Contact, Olivia Jones, Manulife, 438-340-3416, [email protected]

Related Links

https://www.manulifeim.com/

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