News Releases
Guardian Group of Funds (GGOF) today announced the launch of additional T Class mutual funds to provide investors with more options for regular, predictable cash flow with greater tax efficiency. In addition to expanding the number of funds that offer T Class, GGOF is offering investors a choice between 5 per cent and 8 per cent annual cash flow.
“Retirees and boomers approaching retirement are looking for investments that provide capital growth with capital preservation as well as some income generation as they prepare to fund up to thirty years of retirement,” said Gavin Graham, Chief Investment Officer, GGOF. “Yet, it can be difficult to find investment options that meet all of these needs. Too much emphasis on capital preservation can result in a loss of purchasing power to inflation; too great an emphasis on capital growth can create an uncomfortable degree of volatility, potentially putting capital at risk and providing insufficient income for every day needs.
“Investors are also challenged in the current low interest rate environment - income producing investments like traditional GICs and government savings bonds offer low yields and even lower after-tax income, with little potential for the growth of capital required to meet income needs in the future,” added Graham.
T Class mutual funds offer investors an alternative to traditional income-generating investments, providing regular, predictable cash flow, regardless of the income generated by the underlying investments. They generate cash flow each month by distributing, rather than selling, a predetermined percentage of the value of the investment: since this cash flow is not dependent on the income generated by the underlying fund, T Class funds enable investors to draw regular cash flow, while potentially deferring taxation.
The unique structure of T Class units provides investors with various tax advantages. Firstly, it allows the investor to defer taxation, effectively controlling when to incur the tax liability. Secondly, once a gain is realized, it is taxed at the preferential capital gains rate. T Class units also offer a more productive use of capital - because taxation is deferred until the investor's time of choosing, an investor needs to withdraw less principal to produce the same after-tax monthly cash flow.
Although a relatively new investment option, T Class funds have been popular with Canadian investors. According to Investor Economics, assets in T Class funds doubled to $5.5 billion in 2007.
“With twenty investment options, GGOF's T Class Funds provide investors with complete investment flexibility,” said Graham. “It is now possible to invest in a wide variety of asset classes, an essential part of a diversified portfolio, while still generating much needed cash flow.”
GGOF offers the following funds in T Class units:
GGOF Income Funds
GGOF Monthly High Income Fund
GGOF Monthly High Income Fund II
GGOF Equity Funds
GGOF Canadian Large Cap Equity
GGOF Dividend Growth
GGOF Enterprise
GGOF European Equity
GGOF Global Absolute Return
GGOF Global Dividend Growth
GGOF Global Equity
GGOF Global Real Estate
GGOF Diversified Funds
GGOF Canadian Diversified Monthly Income
GGOF Canadian Balanced
GGOF Global Diversified
GGOF U.S. Diversified
GGOF Small Cap Growth and Income
GGOF Solutions
GGOF Income Solution
GGOF Conservative Solution
GGOF Balanced Solution
GGOF Growth Solution
GGOF Aggressive Growth Solution
GGOF provides investors with a full product line of 35 mutual funds, diversified by asset class, geographic region and capitalization. GGOF, with $5.82 billion of mutual fund assets under management at December 31, 2007, offers its funds exclusively through financial intermediaries.
GGOF is a member of BMO Financial Group and part of the organization's
Private Client Group. The Private Client Group provides integrated wealth
management services in Canada and the United States and had total assets under management and administration and term investments of $275 billion as at October 31, 2007.