ING offers 1% bonus to invest in streetwise funds | General comparisons | Discussion forum

Personally, I prefer to invest in index funds with an MER well below 1%. The Streetwise funds have an MER of 1% last time I checked, so I would never invest in them even though I like ING.

Other index funds out there have MERs ranging from 0.3% to 0.8% ish, which are a better deal. The TD eSeries funds and index funds from RBC are two examples of funds with low MERs from solid companies.

I'm not sure of the details surrounding the 1% bonus by ING - is it only good for a year or something? Because mutual funds are supposed to be buy and hold, an extra 1% for a year doesn't help much if you hold the funds for 5, 10, 20 years and like I said, other index funds offer a yearly MER of below 1% for similar performance levels.

The TD e-series funds have very low MERs -- the lowest around for those who don't have huge amounts of invested assets to qualify for an MER discount. They are not the normal TD funds, they are funds maintained through TDs EasyWeb online portal (not available through a broker or other online brokerage) and all communication is electronic only.

Here is TDs official site about the e-series funds:
http://www.tdcanadatrust.com/m...../index.jsp

A quick summary of some of the TD e-series MERs:
TD Canadian Bond Index = 0.48%
TD Canadian Index = 0.31%
TD U.S. Index = 0.33%
TD International Index = 0.44%

I also like the RBC index funds if you want access to low MER funds though your own existing discount online brokerage. Their MERs are higher, but still well below 1%.

There's also the CIBC International Index fund whose MER is a bit above 1%, but far below what most emerging markets (china, brazil, etc) funds charge (2% and way up).

None of these require high investment amounts to get the low MER.

This page has a nice table summarizing the low MER funds available out there:
http://www.bylo.org/idxfunds.html

Enjoy!

Other index funds out there have MERs ranging from 0.3% to 0.8% ish, which are a better deal.

This is not true. ING Streetwise is Managed. TD eSeries are great but not managed. The TD Managed comparable to ING streetwise is actually 1.19% MER. You can do the same with the eSeries, but you have to manage it yourself....
Read this : http://www.squawkfox.com/2008/.....ies-funds/

If you open an account at a discount broker, you have to pay annual fees and commission for every trade and you have to build the equivalent portfolio. Is it really worth the 0.50% difference... Not sure

Not necessarily true. I use Credential Direct, the online discount brokerage that most credit unions refer people to, and there are no annual fees for non-registered accounts, and the mutual fund transactions (purchases, etc) are FREE. For RRSP accounts, there's an annual fee if your account balance is below $25,000. I'm not sure if there's a fee for a TFSA account as I don't have one there, but I doubt it.

So, yes, it is worth the 0.5% difference.

With Credential Direct, the commission charged for trades is only when you are trading individual stocks, not mutual funds.

All brokers differ slightly in what they do and don't charge for, and how much each charge is, and some do charge for mutual fund trades, so like with anything people have to do their homework about fees before opening an account at a financial institution.

TD e-Series funds also have no fees.

Managed funds usually do not outperform the overall stock market, so there's little point in going for the majority of managed funds with higher MERs versus sticking with index funds with lower MERs, unless you are an unmotivated and uninformed total novice that won't take the 10 minutes to check and, if necessary, rebalance your portfolio once a year.