Payment Methods And Fees

What forms of payment does QVIM accept?
QVIM is paid directly through client accounts held at NBIN Inc. (National Bank Independent Network, or "NBIN") on a monthly basis. QVIM does not accept cash, cheques or credit cards.
What does a "fee-based" portfolio manager mean exactly?
Unlike most investment advisors, our Investment Manager (IM) staff has actual Bay Street trading floor experience. Our Chief Investment Officer was a former Vice President at Canada's largest bank broker dealer.
How does QVIM get paid?
QVIM is responsible for various investment mandates and is paid a corresponding management fee that ranges from 0.75% to 2% of assets managed. This fee represents 100% of QVIM's compensation and is deducted (monthly) directly from your investment account(s) held at NBIN. QVIM does not receive commissions from third party fund companies because we do not sell products to our clients. Investment management fees for non-registered accounts are potentially tax deductible..
How do other investment managers get paid?

Traditionally, investment managers have been paid using a transaction-based model. The client is charged every time trades are executed. One could argue that this model is flawed because it encourages managers to trade excessively in order to generate more fees.

Investment managers should not be confused with mutual fund salespeople. Mutual fund salespeople receive a commission on the sale of mutual funds that can be as high as 4% to 6%. Depending on the type of mutual fund sold, they may also receive other embedded commissions.

What are all the various fees I can expect to pay?

At QVIM, we want our clients to feel that fees are clear and transparent. The following is a list of fees that clients should be aware of:

Investment Management Fee

Charged by QVIM, this is an annual fee that varies according to the investment mandate. Fees range from 0.75% to 2% per annum. This fee is charged directly to your NBIN account(s). It is charged monthly, in arrears, on client assets managed.This fee is tax deductible for non-registered accounts.

Custodial Fee

This fee is charged by NBIN, the custodian of client assets. Safekeeping or custody is a service in which the brokerage or financial institution holds securities on behalf of the client, which reduces the risk of the client losing his/her assets or having them stolen. QVIM has negotiated a discounted custodial fee on client assets. This fee is 0.10% per annum for households with less than 2.5 million CAD to invest. This fee drops to 0.05% per annum for households with investable assets in excess of 2.5 million CAD.

Trade Execution Fee

QVIM has negotiated a discounted fee for equity and equity option trade execution via NBIN. The currency of the commission will depend on the exchange used to transact the security (CAD or USD).

Equity: $0.015 per share ($15 trade execution minimum).

Equity options: $10 plus $1.25 per contract.

Foreign exchange: trade execution charges range from 0.20% to 1.00% and is a function of the amount of the order.

Bonds: trade execution charges are determined by the appropriate bond desk at the time of purchase/sale.

Exchange Traded Funds (ETFs) Fees

QVIM uses ETFs extensively because they are a cost-effective, tax-effective, diversified and exchange traded alternative to mutual funds. ETFs have an embedded management expense ratio (MER) that is deducted by the fund companies and subtracted from the daily Net Asset Value (NAV). ETF management fees are very low when compared to mutual funds. Although they can vary in Canada, the majority come in between 0.40% to 0.60% per annum. At the time of writing, iShares management fees ranged from 0.09% to 0.98% per annum. This fee is only paid while the client holds the ETF in question.

NBIN USD Registered Plan Fees

On December 1, 2014 NBIN launched USD denominated registered accounts. There is no additional administration fee to operate these plans however an inactivity fee may be levied on accounts with less than $25,000 USD in equity and one commissionable trade per quarter. The inactivity fee is $12.50 USD per quarter.

NBIN Service Charges

QVIM has a pricing agreement with NBIN that covers those services that QVIM believes are most important to its clients. Nevertheless, there may be client initiated transactions where a service charge applies. One example of such a transaction would be an RRSP withdrawal. Existing clients can refer to NBIN's Statement of Disclosure of Fees and Services Charges document.

My grandparents are also clients of QVIM. I was surprised to find out that they pay a 1% fee whereas I pay 2%. Is this an oversight and am I being overcharged?
This is not an oversight. Different investment mandates will command different fees. For instance, clients with a very conservative investment mandate to buy and hold bonds may get charged 0.75% to 1%. On the other hand, clients with very aggressive mandates will require much more monitoring and trading. Aggressive mandates will usually get charged managment fees in the range of 1.5% to 2%. These are examples for illustrative purposes only.