Manulife Investments proposes changes to pricing model, risk ratings

“The new model offers standardized management fee reductions to securityholders who meet certain eligibility requirements, such as reaching certain asset levels in their combined household holdings,” Manulife says in its announcement.

“The fee reductions will not be limited to an individual fund; they will apply to the securityholder’s total Manulife mutual fund holdings across all series,” the company adds.

Manulife In proposes to replace certain operating expenses of its funds (excluding the Manulife Dollar-Cost Averaging Fund) with fixed administration fees.

Variable operating expenses, a component of the management expense ratio (MER), are currently charged to the funds. In an effort to generally keep future MERs equal to or below the most recently reported MERs, management fee changes are proposed as well for certain series of certain funds.

Manulife will hold a special meeting of securityholders on or about Nov. 16, to consider the proposed changes. If approved, it is expected that the proposed changes will be implemented on or after Jan. 1, 2017.

This changes are expected to give securityholders immediate cost savings, fee predictability and protection against increased MERs, Manulife says.

“Advisors and their investors are demanding simpler, predictable and competitive pricing,” says Bernard Letendre, president, Manulife Investments, in a statement.

“These changes will make it easier for advisors and investors to understand and access our investment platform,” he adds.

Risk rating changes

Manulife Investments also announced a risk rating change to the three funds:

• Manulife Global Real Estate Unconstrained Fund, from “medium to high” to “medium”
• Manulife Conservative Income Fund, from “low” to “low to medium”
• Manulife Preferred Income Class, from “low” to “low to medium”

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