In response to exceptionally low short-term interest rates, Fidelity Investments Canada ULC is temporarily waiving a portion of the management fees charged on its money market funds. The goal of these changes is to maintain a positive yield for investors.
The temporary management fee reductions are being made on the following Fidelity Funds:
- Fidelity U.S. Money Market Fund
- Fidelity Canadian Money Market Fund
- Fidelity Premium Money Market Private Pool
- Fidelity Canadian Short Term Income Class
On some series of the Funds, Fidelity pays trailer fees to dealers from the management fees collected. On these series, the trailer fees may be reduced to contribute to the total fee reduction required. Fidelity and dealers will share in any fee reductions that may be required.
Fidelity will not be changing the investment approach of the Funds to seek higher yields. The Funds continue to provide investors with a secure and liquid investment option.
Current trailer fee rates
|Fidelity Canadian Money Market Fund||0.25%||0.25%||0.25%||0.25%||0.00%||n/a|
|Fidelity Canadian Short Term Income Class||0.25%||0.25%||n/a||n/a||0.00%||n/a|
|Fidelity Premium Money Market Private Pool||n/a||0.25%||n/a||0.25%||0.00%||0.50%|
|Fidelity U.S. Money Market Fund||0.00%||0.00%||n/a||n/a||n/a||n/a|
Frequently asked questions
Q. Why is Fidelity taking this course of action?
A. With short-term interest rates at exceptionally low levels, we have made these changes to maintain a positive yield on our money market funds.
Q. Will you do anything else to support yields for the Funds?
A. Fidelity is not changing the investment approach employed in the management of the Funds in order to support higher yields. The primary goal of our investment management activities is to provide investors with a secure and liquid investment option.
Q. What does this mean for an advisor? Can you explain how the trailer fee adjustment process will work?
A. Fidelity is reducing trailer fees and sharing any required fee reductions with advisors.
For each trailer fee payment period, we will review the maturity profile of the Funds’ portfolios and expected reinvestment rates and will recalibrate and set the trailer fees that will be paid over the next period. Advisors and investors will be able to see the trailer fees payable for the current trailer payment period on this page of our website.
The fee reductions will be implemented gradually, as required.
These policies are subject to change depending upon changes in market conditions.
Q. Are these changes permanent or temporary?
A. These changes are temporary. Fidelity will continue to monitor the situation and will make changes as necessary.
Q. Does this mean investments in the Funds are still safe? Can investors lose money in the Funds?
A. The primary goal of our investment management activities is to provide investors with a secure and liquid investment option.
We can state unequivocally that Fidelity’s money market funds continue to provide security and safety for our customers’ cash investments. Our funds continue to invest in money market securities of high quality, and our customers continue to have full access to their investments any time they wish. Protecting the $10.00 net asset value (NAV) has always been our number one objective in managing these funds.
Q. What type of investments do the Funds make?
A. Fidelity’s money market funds continue to invest in money market securities of high quality. We are very confident in the safety and liquidity that our funds provide. Please read your Fund’s Simplified Prospectus for more information.