What we're looking at
Although they pay next to nothing these days as a result of low interest rates, money market funds remain a popular parking spot for cash. Here, we zero in on money market funds with high upfront investment requirements. What's so special about these funds? Extra low fees, and higher than average returns.
Funds needed a history of at least five years and a minimum initial investment of $5,000 to make this list, although you'll notice many with much higher thresholds. Funds have been ranked by assets.
What we found
If you must have a money market fund, these are the ones you want. Notice the high frequency of first quartile returns and the complete absence of four-quartile returns. Quartiles divide funds in a category in four groupings - first quartile is the elite, fourth is the dregs.
Another view on the performance of these funds: The vast majority have far outpaced the average one- and five-year returns for Canadian money market funds of 0.08 per cent and 1.96 per cent, respectively (those returns are to July 31).
Fee-wise, the high upfront investment requirement means a huge break over most other choices in the money market field. The average management expense ratio for the category is 0.83, which is atrocious when you go back to that one-year return of 0.08 per cent. The funds on today's list are also charging more than they're making right now, but the low fees put you on a good footing to start making more when interest rates rise.
Until rates move higher, consider money market fund alternatives such as high-interest savings accounts that can be traded like mutual funds. Examples: Renaissance High Interest Savings Account and Altamira High-Interest CashPerformer both paid 0.9 per cent on an annual basis as of mid-August.
|Money Market Funds with High Minimum Upfront Investments|
|As of July 2010||As of July 31, 2010|
|Name||Assets ($ mil)||Latest MER||1-yr (%)||QT 1-yr||5-yr (%)||QT 5-yr||Min. ($)|
|RBC Premium Money Market||6,988.41||0.33||0.23||1||2.74||1||100,000|
|TD Premium Money Market||3,586.11||0.32||0.18||1||2.61||1||100,000|
|CIBC Canadian T-Bill Premium Class||1,166.03||0.20||0.17||1||2.24||1||100,000|
|BMO Premium Money Market||782.45||0.41||0.48||1||2.62||1||150,000|
|Scotia Premium T-Bill||730.17||0.45||0.05||2||2.11||2||100,000|
|PH&N Canadian Money Market-D||474.10||0.32||0.18||1||2.55||1||5,000|
|National Bank Treasury Management||416.28||0.28||0.62||1||2.79||1||1,000,000|
|National Bank Corporate Cash Mgmt||274.74||0.45||0.43||1||2.61||1||100,000|
|SEI Money Market-O||153.21||0.14||0.58||1||2.87||1||150,000|
|Montrusco Bolton T-Max||61.27||0.15||0.36||1||2.08||2||150,000|
|Beutel Goodman Money Market||48.72||0.15||0.14||2||2.34||1||10,000|
|Integra Short Term Investment||42.35||0.95||0.24||1||1.86||3||10,000|
|McLean Budden Money Market D||40.33||0.55||0.27||1||2.30||1||10,000|
|Leith Wheeler Money Market||37.07||0.64||0.00||3||2.05||2||25,000|
|Mawer Canadian Money Market||23.61||0.41||0.01||3||1.90||3||5,000|
|IA Clarington Money Market-B||12.58||0.64||0.01||3||2.26||1||100,000|
|ATB Money Market Series I||12.09||0.38||0.25||1||2.49||1||250,000|
|Harmony Money Market Pool||10.23||0.39||0.00||3||2.10||2||50,000|
|GBC Money Market||9.95||0.87||0.01||3||1.90||2||100,000|
|Sceptre Money Market-A||9.58||0.80||0.03||3||2.09||2||5,000|
|Standard Life Money Market-L||5.02||0.52||0.17||1||2.15||2||250,000|
|Harmony Money Market Pool-W||3.13||0.38||0.01||3||2.09||2||50,000|
|Standard Life Money Market-E||1.26||0.54||0.18||1||2.17||2||100,000|
|SEI Money Market-I||0.77||0.66||0.10||2||2.34||1||150,000|
|Scotia Premium T-Bill||N/A||0.45||0.42||1||2.48||1||1,000,000|
|Scotia Premium T-Bill||N/A||0.45||0.26||1||2.31||1||250,000|
|North Growth Cdn. Money Mkt.||N/A||0.25||0.05||2||2.50||1||150,000|
|CIBC Money Market||N/A||1.14||0.00||3||2.06||2||500,000|
© 2007 The Globe and Mail. All rights reserved.
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