IFC Leak Questions

A registrant adds value by helping clients match mutual fund solutions to their needs and objectives, not by making promises or pushing products.

B (low MERs) is one factor, but not the entire scope of advice.

C (guaranteeing performance) is unethical and prohibited.

D (cross-selling) prioritizes the dealer, not the client.

Withdrawals under a ratio withdrawal plan are based on the current portfolio value, ensuring the fund is never fully depleted unless a 100% payout ratio is used. The feedback from the document states:

"Under a ratio withdrawal plan, the ratio is always based on the current portfolio value. Technically, this means that clients will never fully exhaust their mutual fund investment under this type of plan. Only in the unrealistic situation of a 100% payout ratio would the fund be completely paid out."

An RRIF (Registered Retirement Income Fund) requires annual minimum withdrawals starting the year after it is established.

It can be either self-directed or managed.

The RRSP must be converted to an RRIF or annuity by the end of the year the holder turns 71; the RRIF itself is not terminated at that age.

Withdrawals are based on the age of the annuitant or spouse.

Thus, the key requirement is minimum annual withdrawals.

The right of withdrawal is a statutory right that allows investors to cancel their mutual fund purchase within two business days of receiving the Fund Facts document or confirmation of purchase, whichever is later. The right of withdrawal is based on the securities act legislation within the jurisdiction where the purchase occurred, which may vary slightly across provinces and territories.