When it comes to new financial products, I like to nitpick or even criticize. Undoubtedly, in most cases, the criticism is thoroughly deserved. But occasionally a product is introduced that deserves praise. The latest instance is the announcement of an inflation-linked bond fund by Phillips, Hager & North (now owned by Royal Bank).
The actively-managed fund will invest in real-return bonds and other inflation-linked securities but the main attraction is the low-fees. The Series D units, available directly from PH&N (minimum account size is $25,000) or RBC Direct Investing (minimum of $10,000 per fund per account), have an ultra-low MER of 0.45%, which compares rather favourably with the 0.35% MER of the iShares CDN Real Return Bond ETF (XRB). The fund is also available in Series C (MER of 0.80% including a trailer of 0.50%) and Series F (MER of 0.30% for fee-based accounts). The fund profile is available here and the PH&N website also has a periodic table showing the need for diversifying fixed-income assets. Morningstar’s Rudy Luukko’s take on the inflation-linked bond fund can be found here.
PS: Thanks to Jon Chevreau and Cam Birch for the heads-up on the introduction of the fund.
PPS: The votes have been tallied in the Globe and Mail “Best of the blogs” feature and the winners announced. Million Dollar Journey, Squawkfox, Wellington Financial Blog, Where Does All My Money Go?, Four Pillars and Thicken My Wallet finished in the top ten. Thanks to the Globe and Mail for the opportunity to contribute to the list and thanks to you for voting for your favourites.
