8 reasons to invest in Segregated Funds

April 1, 2025

There are many reasons that make investing in segregated (seg) funds a significant strategy when creating wealth. See if these reasons appeal to you and discuss seg funds with your advisor:

  1. Simplified investing You can select an industry or sector, for example, without having to hand-pick each security. The segregated fund manager does this selection process for you. You don’t have to be assessing which stock or bond may or may not be a winner. A fund manager is trained to weigh out all the market contingencies which can affect investor performance.
  2. Diversification A small monthly purchase plan can have you moving forward in your strategic fund investments in a day. Your money can buy a piece of many different investments held within one or more funds.
  3. Dollar-cost averaging is an investment strategy that allows you to buy more fund units when the unit values are down and fewer when they are high, allowing you to benefit from downward volatility.
  4. Flexible access to your money You can sell your fund shares in one day, and your proceeds are available the next day if you need your money in the short term.
  5. Portfolio-balancing Choices include the full range of fund types and strategies available, such as strategic balancing of your segregated fund holdings.
  6. Capital guarantees Segregated funds may offer certain principal guarantees at maturity and/or death. In some cases, market gains can be locked in and guaranteed after a period of time. Some segregated funds have options to lock in a portion or all of the gains to date, which resets a guarantee at a higher level after a defined period.
  7. Avoidance of Probate The proceeds of a segregated fund policy flow to the beneficiaries without going through probate, which can avoid significant estate fees. It can also prevent disgruntled beneficiaries from contesting these funds if they pass through a will.
  8. Potential Creditor Protection Creditor protection is offered because it is an insurance product, insofar as the investment is made before any creditor issues are apparent. Discuss this with your advisor to keep abreast of legislation regarding creditor protection.

 

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Mutual Funds and/or Segregated Funds Disclaimer

Commissions, trailing commissions, management fees and expenses all may be associated with mutual fund investment funds, including segregated fund investments. Please read the fund summary information folder prospectus before investing. Mutual Funds and/or Segregated Funds may not be guaranteed, their market value changes daily and past performance is not indicative of future results. The publisher does not guarantee the accuracy and will not be held liable in any way for any error, or omission, or any financial decision. Talk to your advisor before making any financial decision. A description of the key features of the applicable individual variable annuity contract or segregated fund is contained in the Information Folder. Any amount that is allocated to a segregated fund is invested at the risk of the contract holder and may increase or decrease in value. Product features are subject to change.