The Mystery of Investment Fees in Canada: Understanding What You're Paying For

Investment fees in Canada can be a mystery to many investors. They often wonder what exactly they are paying for and whether or not they are worth it. The truth is, investment fees should definitely be looked at, but they are not even close to the most important factor when making an investment decision.

In Canada, posted returns are always net of fees, meaning that the returns you see advertised have already had the fees subtracted from them. This can make it difficult to understand exactly how much you are paying in fees and what you are getting in return.

It's important to remember that fees are a necessary part of investing. They go towards things like research, portfolio management, and administrative costs. However, it's also important to understand that they are not the only thing you should be considering when making an investment decision.

Let's say, for example, that the fees for a particular investment were 10%. Would you still buy it? Now, let's say that the investment has historically returned an average of 15% after fees for the last 20 years. Which is more important, the fees or the return? The answer should be obvious - the return.

Please note that the numbers used in this example are for illustrative purposes only and are not based on any specific investment or investment product. It's always good to do your own research and compare the fees with the returns, before making any investment decision.

While it's important to understand and be aware of investment fees, they should not be the only thing you consider when making an investment decision. A much more important factor should be the potential return on your investment given the amount of risk you are willing to take on. It's also important to remember that a higher fee does not always mean a better investment. In some cases, a lower fee may be worth it if the potential return is higher.

In conclusion, investment fees in Canada can be confusing, but they are a necessary part of investing. While they should be looked at, they are not the most important factor when making an investment decision. The most important thing to consider is the potential return on your investment. It's always good to do your own research, and compare the fees with the returns, before making any investment decision.