Segregated Funds in Canada
Segregated portfolio.
A segregated portfolio is the differentiation of the assets of clients and the intermediary company by separate accounts.
In this case, the clients' money is placed in independent custodian banks.
Next, the investor decides for himself which assets to place his funds in. According to the chosen strategy, the money is transferred directly to the specified details.
In other words, under any circumstances, the client's money will be completely protected from illegal actions with them.
Segregated Funds in Canada
Now many intermediaries offer to open a segregated account for investments with their help:
At the same time, the entry threshold for opening such accounts in a bank or with a broker is usually 50 thousand dollars. Therefore, not every investor can afford such a service.
Pay attention! Insurance unit-linked programs (also called the “English method of investment”) already include the placement of investor funds in segregated accounts in programs with minimum contributions of only $ 100. There is no need to pay separately for their opening.
Many investors are wondering – what is the point of an intermediary from placing my assets on segregated accounts? After all, they have no benefit from these actions? However, in fact, a self-respecting intermediary is interested in observing the interests of the client, first of all, and satisfying his requests. If the client is calm about the safety of his funds, he will treat the company with great confidence.
Advantages of segregated portfolios for the investor.
Segregated accounts have no disadvantages. The only downside is the high entry threshold if you invest through a brokerage company. In insurance companies, as a rule, absolutely all client assets are stored in segregated accounts, regardless of the amount of invested capital.
A segregated investment portfolio is a convenient tool for investors who like reliability and increased guarantees for their capital. Thus, the client will be sure of the safety of assets and the impossibility of committing illegal actions with them.