In this article:
Overview
You can now hold mutual funds in a trading account. You can consolidate your investments by transferring existing mutual funds from other financial institutions to Wealthsimple without having to sell them first.
Once you transfer your mutual funds to Wealthsimple, you can view your holdings, track their performance through historical charts, and sell them directly through the Wealthsimple app or web.
Some funds are moved into a lower-cost version of the same fund after they arrive. You'll find more about that below.
Eligibility
To transfer mutual funds into Wealthsimple, they must meet the following criteria:
- Funds must be transferred into a trading account.
- The fund company must have a dealer agreement with Wealthsimple. We don't support all fund companies.
- The fund must be a series that can be offered through a discount brokerage.
What happens if your fund charges a trailer fee
A trailer fee is an ongoing fee built into the cost of a mutual fund. It doesn't stop your fund from transferring over. Depending on the fund, one of two things happens after it arrives:
- We move you into a lower-cost version of the same fund. You keep the same investments and the same fund manager, and your ongoing costs are lower. This happens once your transfer settles, usually within about 15 business days, and we email you when it's done.
- You keep the fund you have, and we return the trailer fee to you. Your fund stays exactly as it is.
Either way, there's nothing you need to do.
What's not supported
- Buying new mutual funds
- Internal transfers of mutual funds between different Wealthsimple accounts
- Funds that charge a Deferred Sales Charge (DSC) or a low-load charge
- Funds held in an account that's managed for you by an advisor. Your funds need to be held in a trading or investing account at your other institution.
How to transfer mutual funds
You can start an in-kind institutional transfer through the Wealthsimple app or web. To transfer your funds:
- Log in to the Wealthsimple app
- Tap the Move tab at the bottom of your screen
- Scroll down and tap Transfer an account to Wealthsimple under Accounts
- Tap Get started
- Follow the prompts to complete your account transfer
- When asked "Does your account have any of the following assets?", select the mutual funds that apply
- Tap Next
- Complete the transfer request
- Log in to your Wealthsimple profile
- Select the Move money menu in the top right corner
- Select Move an account from the menu
- Select Get started
- Follow the prompts to complete your account transfer
- For joint accounts, your co-owner must accept the transfer request from their profile
- When asked "Does your account have any of the following assets?", select the mutual funds that apply
- Select Next
- Complete the transfer request
Trailer fee reimbursements
What a trailer fee is
Some mutual funds include a trailer fee. It's an ongoing fee the fund company pays to whoever holds your investment, and it's built into the cost of the fund rather than taken from your cash. You never see it leave your account.
Why we return it
The trailer fee pays for financial advice. Wealthsimple is an order-execution-only brokerage, which means we don't give investment advice, so we're not permitted to keep it. Where we can't move you into a version of the fund without the fee, we return it to you instead.
Which funds this applies to
Reimbursements apply to mutual funds held in a self-directed account. If you hold mutual funds in a managed portfolio, you won't receive these reimbursements. This is based on the type of account rather than the fund itself.
Both registered and non-registered self-directed accounts are eligible.
How often you'll receive it
Reimbursements follow the fund's own schedule. You'll keep receiving them for as long as you hold that fund.
If your fund was moved to a lower-cost version, you may also see a one-time reimbursement covering the period before the move.
Where to find it
Your reimbursement appears on your monthly statement as a separate line showing the amount and the fund it relates to.
How much to expect
Reimbursements cover only the trailer fee portion of the fund's cost for that period, so the amounts are usually small, often less than a dollar.
Tax treatment
- Non-registered accounts: a reimbursement counts as income and is reported on your T5 slip as other income.
- Registered accounts: there's no tax to pay and no slip is issued. A reimbursement isn't a contribution and doesn't use any of your contribution room.
We can't give tax advice, so please speak with a tax professional about your own situation.
How to sell mutual funds
You can sell your mutual fund holdings through the Wealthsimple app or web.
- Log in to the Wealthsimple app
- From the Home page, tap Holdings
- Select the mutual fund from your holdings
- Tap Sell
- Enter the quantity you want to sell in units, or toggle to enter a CAD value
- Tap Review to see the order details
- Tap Submit to place your order
- Log in to your Wealthsimple profile
- From the Home page, navigate to Holdings on the right-hand side
- Select the mutual fund from your holdings
- Select Sell
- Enter the quantity you want to sell in units, or toggle to enter a CAD value
- Select Review to see the order details
- Select Submit to place your order
Important details about selling
- All sell orders are processed as market orders at the fund's end-of-day Net Asset Value (NAV).
- You must place your order before 3:00 pm ET for it to be processed on the same business day.
- You can cancel a pending sell order as long as you do so before the 3:00 pm ET cutoff.
Frequently asked questions
Can I buy mutual funds on Wealthsimple?
No, you can't buy new mutual funds at this time. You can only transfer in, hold, and sell funds you already own at another institution.
How do I know if my mutual funds have DSC or trailer fees?
To find out if your mutual funds have DSC or trailer fees, you can review your account statements or your fund's "Fund Facts" document, which details all costs. You can also ask your advisor directly for this information. DSC fees are charges that apply if you sell your fund before a set date, often within seven years, while trailer fees are ongoing annual costs paid to an advisor.
Why was my mutual fund transfer rejected?
The most common reasons are:
- the fund company doesn't currently have a dealer agreement with Wealthsimple,
- the fund has DSC or trailer fees, or
- the fund is a proprietary fund of your current institution.
If you're unsure why your transfer was rejected, contact our support team.
Why does my fund have a different code than before?
If your fund charged a trailer fee and a lower-cost version was available, we moved you into that version after your transfer settled. You keep the same investments and the same fund manager, and your ongoing costs are lower. We email you once this is done, with the old and new fund codes.
My transfer is complete, but my fund hasn't changed. What's happening?
The switch to a lower-cost version runs after your transfer settles, so your transfer can show as complete before it happens. It usually takes about 15 business days from settlement. We'll email you once it's done.
Why can't I find a mutual fund using the search bar?
Mutual funds aren't searchable in the app right now. They'll only show up in your account holdings after you've successfully transferred them from another institution.
Are there tax implications for transferring my funds?
Transferring your mutual funds "in-kind" (without selling them) is generally not a taxable event. However, selling those funds later from a non-registered account could result in a capital gain or loss for tax purposes.
Why was my fund sold at a different price than what I saw in the app?
Unlike stocks, mutual fund prices are only calculated once per day after the market closes. Your order is processed at the official end-of-day Net Asset Value (NAV), which may differ from the last known price shown when you submitted the order.
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