Toronto-based NEI Investments will discontinue the deferred sales charge (DSC) and low-load options on its mutual funds later this year.
The firm said Friday it will close DSC and low-load purchases to new investors around Aug. 10, and to existing investors around Oct. 5. Those already invested in DSC and low-load funds will still be subject to the redemption fee schedule.
“There is falling demand for such options across the industry as advisors seek alternate fee arrangements to meet their clients’ needs,” a release from NEI said.
The Canadian Securities Administrators’ ban on DSC mutual funds will take effect in 2022 in all jurisdictions except Ontario, which will instead adopt a series of restrictions on sales of the funds.
Other firms, including BMO Investments Inc., are also moving to discontinue their DSC options.
DSC funds have seen “deep net redemptions” for more than a decade, according to Investor Economics. At the end of 2019, DSC assets in Canada represented 7.4% of the industry total, the firm said in a March report.