Lets' say you decided to use 4 TD funds, and you are investing $950.

You could purchase 25% or $237 of each of TDB909 (Canadian bonds), TDB900 (Canadian equities), TDB902 (US equities), and TDB905 (international equities).

That would leave you with $2 cash in your account - it's a rounding error so you can add $2 to any of the funds, for example buy $239 of TDB909.

Our table shows commonly used funds from 2 providers - use it as an example and do your own research.​

Index mutual funds are precisely identified by code rather than by name (like TDB909 in the table).  

Let's say you want to invest $1,000.

You could purchase $333 worth of each of TDB900, TDB902, and TDB905, for a total of $990. You'd be left with $1 in your account - but you can add it to any of the funds and buy $334 of it.

You can add fixed income to an equity-only mutual fund portfolio by buying one or more GICs - directly from the issuing bank, choosing one that offers a good interest rate.

  • At times it makes sense as the interest on the GICs may be higher and come with less risk than a bond mutual fund.​


Asset mix

0% fixed income / 100% equity

  • There is no fixed income component.
  • The equity component (100%) is divided into 3 equal parts of 33% each (Canadian, US, and international).
  • 1% is leftover - it can be added to any category (rounding won't affect your asset mix much). This portfolio has 34% Canadian equity.

You can build your portfolio by mimicking a ready-made portfolio

index mutual fund built by finance professionals.​​

Other fixed income alternatives

Consider GICs (guaranteed investment certificates) as an alternative to fixed income index mutual funds.  They require slightly more effort because you have to set up a separate account / buy GICs / keep up with them - possibly having to deal with another financial institution. GICs often make more money than fixed income mutual fund of comparable risk.​ 

There are several other benefits. 

  • GICs are simpler, more predictable, and less expensive than fixed income index mutual funds. 
  • Mutual fund distributions are not known in advance. GICs pay stated interest - you know exactly how much you'll earn.
  • GICs have no MER fees. 
  • When you sell mutual funds, you don't know how much you'll get.  It depends on the price other investors are willing to buy at. GICs work differently - you'll know exactly how much you'll get. 
  • GICs are insured by the federal or provincial government - up to $100,000 per GIC.

build your ​portfolio

find index mutual funds that fit your asset mix​​

You'll use equity and fixed income index mutual funds to represent your asset mix. 

  • Use a few equity funds, like "Canadian equity fund", "US equity fund", and/or "International equity fund" (rich countries outside Canada and the US). 

  • Find one fixed income fund. like "Canadian index bond fund".

  • Make sure the fund is an index fund - the word 'index' should be in the name. If you're not sure, each fund has a "Fund Facts" document. Another clue is the fund's MER - index funds are less expensive than active funds. Worst comes to worst, call a branch and ask - they should know everything about their funds.

we've done some research for you on portfolio funds you can mimic

Here are some real ready-made portfolio index mutual fund offers, representing different asset mixes. Use them for inspiration - but remember, your asset mix is your choice. 

  • Find your asset mix in the left column and follow that row - you'll find two sample portfolios.  


 Asset mix

25% fixed income / 75% equity

  • In fixed income (25%) you'll buy a Canadian bond fund.
  • The equity component (75%) is divided into 3 equal parts of 25% each (Canadian, US, and international).

What does it cost in dollars?  Let's look at Example 1.

The MER for the portfolio is 0.43% if you use the 4 TD funds, and 0.66% if you use the RBC funds.

We calculated it as an average of the MER for the individual funds (which you can find on the providers' websites). 

If you have invested $5,000 for one year, in dollars you'd pay $21.13 at TD and $33.13 at RBC.

we've done some research for you