Blessed by the Potato

You may have received a proxy form in the mail if you’re a TD e-series holder, asking you to for a change in the investment objective of the funds. In case you haven’t seen it, the information circular is on SEDAR.

The main points are that the e-series funds will change the index provider to Solactive, and instead of holding the underlying stocks/bonds themselves (and derivatives), will be able to hold the corresponding ETF. This will come with a 5 bp reduction in management fees.

To break that down a bit, fund companies have to pay a licensing fee to the index creators when they have a fund that tracks that index — they can’t just free-load like I would if I wanted to re-create the S&P500 with an insane number of trades myself. Solactive is an index provider that’s reportedly cheaper to use than S&P/MSCI/FTSE, so the move helps TD save some money. Moreover, it’s the index provider that TD’s ETFs use, which lets the e-series funds start to use those to share some of the work of fund management.

I don’t believe their indexes are different enough from the ones we’re familiar with to worry about it or to have substantially different expected returns. Unfortunately, their site isn’t quite as handy as the other index providers (or Vanguard/iShares) for figuring out what’s in there. Fortunately, TD’s ETF pages list that, for example here’s the Canadian equity index page. It has slightly more holdings (270 vs 239 in the S&P TSX Composite), and some minor differences in sector weightings (e.g. 5.9% vs 7.6% in Technology, though most are closer than that). The US one looks very similar to the S&P500 (even having 500 holdings), as does the new international one to the MSCI EAFE.

The changes are subject to a vote by unitholders, but I don’t foresee that failing.

Remember that MER is backward-looking, so it will take a full year before the new lower management fee is reflected in the MER listed in the fund facts (a year after this is implemented, which may be a few months yet — the vote is late September).

Almost exactly a year later, we found out my dad’s cancer was back. He’s been really sick for months now, off and on in pain and throwing up, in and out of emerg and being admitted to the hospital several times over (in large part because of dehydration from the not eating and throwing up, and trying to solve the root cause of that problem). He’s still in there as I write this, though now he’s had a surgery to solve the intestinal blockage and I think at this point no one close to him is going to find out via the blog that he’s sick.

The prognosis with recurrent metastatic cancer is, well… it’s not good.

So let’s talk about something else. One of the issues of being admitted to the hospital is that it’s so hard to sleep. I got my dad a noise maker/white noise gizmo, one that’s made to hook onto a stroller for a baby, but works just as well on a hospital bed. And that little bit of steady noise helps him so much with sleeping through the constant noise of a hospital ward.

I had decided that this was a simple, inexpensive thing that could make people’s lives just a tiny bit better, so I should just do a side business things and find a way to get white noise gizmos in all the hospitals/patients’ hands — either by finding a way to sell them to the hospitals, which may involve building a modified version that’s easy to sterilize, has an IV pole clamp, etc., or by convincing the gift shops to start stocking them so patients/families can pick one up while they’re there. I also had the idea of recording the sound of a curling stone rolling across the pebble to add to the more common wave/wind/static noise choices. Anyway, a page of doodling half-thought-out business plan and it was starting to sound not so crazy. But then I went to get an affiliate link from Amazon for that link above, and realized there are a tonne of consumer-grade ones available already. So I will just leave it at the suggestion that if you or a loved one are going to spend some time in a hospital bed, add a noise generator to your list of stuff to get (which may include expecting mothers who have more foresight on a potential hospital stay).

I’m also glad to have a healthy emergency fund. I’ve easily passed $300 in hospital parking bills now, and may hit $400 before dad’s back home (and yes I’ve tried to take the bus a few times — hospital parking’s just expensive). It helps support the hospital and the lots are nearly full anyway, so it makes sense that it’s so expensive, I guess — I’m not really trying to complain too much about that, but still acknowledge that it can be a big, unexpected expense and there is a reason for that savings account full of money in case big, unexpected expenses come up.

Anyway, what I’m trying to say is that I have reasons for not blogging.