TORONTO, July 18, 2019 /CNW/ - TD Asset Management Inc.
("TDAM"), the manager of TD Mutual Funds and TD Managed Assets
Program portfolios, today announced changes to certain investment
funds. The changes include fund mergers, investment objectives and
risk rating updates and other changes as described below.
Certain changes, as outlined below, are subject to regulatory
and/or unitholder approvals at special meetings of unitholders
(each, a "Meeting" and collectively, the "Meetings"),
of each applicable fund, to be held concurrently, with separate
votes for each fund, on September 27, 2019.
In advance of the Meetings, a notice-and-access document will be
mailed on August 23, 2019 to unitholders of record as at
July 29, 2019. The notice-and-access
document will describe the various ways in which unitholders can
obtain a copy of a management information circular that contains
full details of the proposed changes. The notice-and-access
document and management information circular will also be available
on SEDAR at www.sedar.com.
Fund Mergers
Subject to obtaining all necessary regulatory and unitholder
approvals, TDAM proposes that each mutual fund (individually a
"Discontinuing Fund" and collectively, the "Discontinuing
Funds") be merged into the corresponding mutual fund
(individually a "Continuing Fund" and collectively, the
"Continuing Funds") as set out in the table below. If
approved, the mergers will be effective on or about October 25, 2019 (the "Effective
Date").
|
Discontinuing
Fund
|
Continuing
Fund
|
|
TD Balanced Income
Fund
|
TD Diversified
Monthly Income Fund
|
|
TD Advantage Balanced
Income Portfolio
|
TD Managed Income
Portfolio
|
|
TD Advantage Balanced
Portfolio
|
TD Managed Income
& Moderate Growth Portfolio
|
The merger of each Discontinuing Fund into the applicable
Continuing Fund will be effected on a tax-deferred basis for
unitholders. If the proposed mergers are approved, unitholders of
each series of each Discontinuing Fund will receive units of the
equivalent series of the Continuing Fund, determined on a
dollar-for-dollar basis. Each Discontinuing Fund will be wound up
as soon as reasonably possible following its merger.
Subject to obtaining regulatory and unitholder approval for the
merger of TD Balanced Income Fund into TD Diversified Monthly
Income Fund, TDAM intends to reduce the management fee charged on
each series of TD Diversified Monthly Income Fund.
The Independent Review Committee of each of the Discontinuing
Funds has reviewed the potential conflict of interest matters
related to the proposed mergers and has provided TDAM with a
positive recommendation for the mergers after determining that each
merger, if implemented, would achieve a fair and reasonable result
for each Discontinuing Fund.
TDAM will not charge unitholders any redemption fees, sales
charges or other fees for any transactions involving units of the
Discontinuing Funds redeemed and/or purchased on or prior to
July 18, 2019. Units of a
Discontinuing Fund purchased after July 18,
2019 (and, accordingly, units of the Continuing Fund
received by an investor in exchange for such units of the
Discontinuing Fund) will be subject to the usual redemption fees if
they were purchased under the back-end load option or either of the
low-load options and the redemption fee schedule will be based on
the date of purchase of units of the Discontinuing Fund.
All costs and expenses associated with the proposed mergers will
be borne by TDAM.
Changes to Investment Objectives
Subject to obtaining unitholder approval, certain funds will
change their investment objectives as indicated below.
|
Fund
|
Current Investment
Objectives
|
Proposed
Investment Objectives
|
|
TD Asian Growth
Fund
|
The fundamental
investment objective is to seek to achieve long-term capital growth
by investing primarily in equity securities of issuers in Asia and
Australasia, excluding Japan.
|
The fundamental
investment objective is to seek to earn dividend income and to
generate long term capital appreciation by investing primarily in
equity securities of issuers located in China.
|
|
TD Canadian Bond
Index Fund
|
The fundamental
investment objective is to maximize total return through both
interest income and capital appreciation by tracking the
performance of the FTSE Canada Universe Bond Index (the "Universe
Index"). The Universe Index is comprised of Canadian
investment-grade bonds which mature in more than one
year.
|
The fundamental
investment objective is to maximize total return through both
interest income and capital appreciation by tracking the
performance of a Canadian aggregate bond index that measures the
investment return of the Canadian investment grade bond
market.
|
|
TD Canadian Index
Fund
|
The fundamental
investment objective is to provide long-term growth of capital
primarily by purchasing Canadian equity securities to track the
performance of the S&P/TSX Composite Total Return Index
("S&P/TSX Composite Index").
The S&P/TSX
Composite Index is comprised of Canadian issuers traded on the
Toronto Stock Exchange.
|
The fundamental
investment objective is to provide long-term growth of capital by
tracking the performance of a broad Canadian equity market index
that measures the investment return of publicly traded securities
in the Canadian market.
|
|
TD U.S. Index
Fund
|
The fundamental
investment objective is to provide long-term growth of capital by
primarily purchasing U.S. equity securities to track the
performance of the S&P 500 Total Return Index ("S&P 500
Index").
The S&P 500 Index
is comprised of 500 widely-held U.S. issuers.
|
The fundamental
investment objective is to provide long-term growth of capital by
tracking the performance of a broad U.S. equity market index that
measures the investment return of large capitalization U.S.
stocks.
|
|
TD International
Index Fund
|
The fundamental
investment objective is to track the MSCI EAFE Index.
The MSCI EAFE Index
is a broadly diversified index consisting of equity securities of
companies domiciled in developed markets outside the U.S. and
Canada.
|
The fundamental
investment objective is to provide long-term growth of capital by
tracking the performance of an international equity markets index
that measures the investment return of mid-and large-capitalization
issuers in the European, Asian and Far East regions.
|
Subject to obtaining unitholder approval for the investment
objective changes, TDAM intends to reduce the management fee
charged on each series of the above noted funds.
The Independent Review Committee of each of the funds listed in
the table above has reviewed the potential conflict of interest
matters related to the proposed investment objective changes and
has provided TDAM with a positive recommendation for the proposed
investment objective changes after determining that the changes, if
implemented, would achieve a fair and reasonable result for each of
the funds.
Declaration of Trust Amendment
Pursuant to the existing amendment provision, TD Canadian
Bond Fund unitholders must approve material changes to the
declaration of trust. Given the expense and time-consuming nature
of obtaining unitholder approval, this limits the ability of TD
Canadian Bond Fund to benefit from revisions to the declaration of
trust that TDAM, as trustee of TD Canadian Bond Fund, may otherwise
be permitted to make in accordance with securities regulations –
revisions which may be beneficial to its unitholders and if not
permitted to be made, may put TD Canadian Bond Fund and/or its
unitholders at a competitive disadvantage. Accordingly, TDAM
proposes to adopt the same amendment provisions applicable to other
TD Mutual Funds, which would allow TDAM to make material changes to
TD Canadian Bond Fund's declaration of trust without seeking
unitholder approval to do so. Should material changes occur,
unitholders would be notified of such changes at least 21 days'
prior to such changes taking effect.
Risk Rating Changes
The following funds will be lowering their risk ratings as
indicated below. These changes will be reflected in the TD Mutual
Funds' Simplified Prospectus and Fund Facts that will be filed on
or about July 25, 2019.
|
Fund
|
Previous Risk
Rating
|
New Risk
Rating
|
|
TD High Yield Bond
Fund
|
Medium
|
Low to
Medium
|
|
TD Canadian Low
Volatility
Fund
|
Medium
|
Low to
Medium
|
|
TD Canadian Low
Volatility
Class
|
Medium
|
Low to
Medium
|
|
TD Canadian Equity
Fund
|
Medium to
High
|
Medium
|
|
TD Canadian Equity
Class
|
Medium to
High
|
Medium
|
|
TD Resource
Fund
|
High
|
Medium to
High
|
|
TD Retirement
Balanced
Portfolio
|
Low to
Medium
|
Low
|
The risk rating changes are based on the methodology mandated by
the Canadian Securities Administrators (the "CSA") and the related
annual review by TDAM to determine the risk level of
publicly-offered investment funds. There are no changes to the
investment objectives, strategies or management of the funds.
A summary of the CSA's risk classification methodology and each
of the funds' investment objectives and strategies can be found in
the TD Mutual Funds Simplified Prospectus, available at
tdassetmanagement.com or on SEDAR at www.sedar.com.
TD Strategic Yield Fund Name Change
Effective on or about November 1,
2019, TDAM will change the name of TD Strategic Yield Fund
to TD Global Tactical Monthly Income Fund to better reflect how the
fund is managed. There will be no change to the fund's investment
objectives or strategies.
Fund Capping
Effective on or about November 1,
2019, the following TD Mutual Funds and TD Managed Assets
Program portfolios will no longer accept additional purchases,
including purchases made through Pre‑Authorized Purchase Plans and
Pre-Authorized Contribution Plans.
- TD FundSmart Managed Aggressive Growth Portfolio
- TD FundSmart Managed Income & Moderate Growth
Portfolio
- TD FundSmart Managed Balanced Growth Portfolio
- TD Advantage Balanced Growth Portfolio
Deferred Sales Charge Purchase Options
In addition, effective on or about November 1, 2019, the back-end load, low-load and
low‑load‑2 purchase options of Advisor Series, T5 Series and T8
Series securities of the TD Mutual Funds and TD Managed Assets
Program portfolios will be closed to all purchases by investors,
including purchases made through Pre-Authorized Contribution
Plans.
TD Asset Management Inc.
TD Asset Management (TDAM), a member of TD Bank Group, is a
North American investment management firm. Operating through TD
Asset Management Inc. in Canada
and TDAM USA Inc. in the U.S.,
TDAM brings new thinking to investors' most important challenges.
TDAM offers investment solutions to corporations, pension funds,
endowments, foundations and individual investors. Additionally,
TDAM manages assets on behalf of almost 2 million retail investors
and offers a broadly diversified suite of investment solutions
including mutual funds, professionally managed portfolios and
corporate class funds. Asset management businesses at TD manage
$391 billion in assets as at
June 30, 2019. Assets under
management include TD Asset Management Inc., TDAM USA Inc., Epoch Investment Partners Inc.
(Epoch) and TD Greystone Asset Management.
Commissions, trailing commissions, management fees and expenses
all may be associated with mutual fund investments. Please read the
fund facts and prospectus, which contain detailed investment
information, before investing. Mutual funds are not guaranteed or
insured, their values change frequently and past performance may
not be repeated.
TD Mutual Funds and the TD Managed Assets Program portfolios are
managed by TD Asset Management Inc., a wholly-owned subsidiary of
The Toronto-Dominion Bank and are available through authorized
dealers.
The TD Canadian Bond Index Fund (the "Fund") has been developed
solely by TD Asset Management Inc. ("TDAM"). The Fund is not in any
way connected to or sponsored, endorsed, sold or promoted by the
London Stock Exchange Group plc and its group undertakings
(collectively, the "LSE Group"). FTSE Russell is a trading name of
certain of the LSE Group companies.
All rights in the FTSE Canada Universe Bond Index (the "Index")
vest in the relevant LSE Group company which owns the Index.
"FTSE®" is a trade mark of the relevant LSE Group company and is
used by any other LSE Group company under license. The Index is
calculated by or on behalf of FTSE International Limited or its
affiliate, agent or partner. The LSE Group does not accept any
liability whatsoever to any person arising out of (a) the use of,
reliance on or any error in the Index or (b) investment in or
operation of the Funds. The LSE Group makes no claim, prediction,
warranty or representation either as to the results to be obtained
from the Funds or the suitability of the Index for the purpose to
which it is being put by TDAM.
The S&P/TSX Composite Index is a product of S&P Dow
Jones Indices LLC, a division of S&P Global or its affiliates
("SPDJI") and TSX Inc., and has been licensed for use by The
Toronto‑Dominion Bank ("TD Bank"). Standard & Poor's®,
S&P® and S&P 500® are registered trademarks of Standard
& Poor's Financial Services LLC, a division of S&P Global
("S&P"); Dow Jones®, Dow Jones Industrial Average® and DJIA®
are registered trademarks of Dow Jones Trademark Holdings LLC ("Dow
Jones"); TSX is a trademark of TSX Inc.; and these trademarks have
been licensed for use by SPDJI and sublicensed for certain purposes
by TD Bank. The TD Canadian Index Fund is not sponsored, endorsed,
sold or promoted by SPDJI, Dow Jones, S&P, their respective
affiliates, or TSX Inc. and none of such parties make any
representation regarding the advisability of investing in the TD
Canadian Index Fund nor do they have any liability for any errors,
omissions, or interruptions of the S&P/TSX Composite Index.
The S&P 500 Index is a product of S&P Dow Jones Indices
LLC, a division of S&P Global, or its affiliates ("SPDJI"), and
has been licensed for use by The Toronto‑Dominion Bank ("TD Bank").
Standard & Poor's®, S&P® and S&P 500® are registered
trademarks of Standard & Poor's Financial Services LLC, a
division of S&P Global ("S&P"); Dow Jones®, Dow Jones
Industrial Average® and DJIA® are registered trademarks of Dow
Jones Trademark Holdings LLC ("Dow Jones"); and these trademarks
have been licensed for use by SPDJI and sublicensed for certain
purposes by TD Bank. The TD U.S. Index Fund is not sponsored,
endorsed, sold or promoted by SPDJI, Dow Jones, S&P or their
respective affiliates, and none of such parties make any
representation regarding the advisability of investing in the TD
U.S. Index Fund nor do they have any liability for any errors,
omissions, or interruptions of the S&P 500 Index.
The fund is not sponsored, endorsed, or promoted by MSCI Inc. or
its affiliates ("MSCI"), and MSCI bears no liability with respect
to the fund or any index on which the fund is based. The fund's
simplified prospectus contains a more detailed description of the
limited relationship MSCI has with TD Bank and any related
funds.
SOURCE TD Asset Management Inc.