by Scott Ronalds

The year-end distributions for all our funds, except the Savings Fund, will be declared on Monday, December 16th and paid on Tuesday, December 17th. The Savings Fund will pay its regularly scheduled monthly distribution on Tuesday, December 31st.

Understanding distributions

As a quick refresher, distributions are how mutual funds transfer accrued interest income, dividend income, and realized capital gains over the year to unitholders. Most investors choose to reinvest these distributions into additional fund units, though you can also opt to receive them in cash.

Impact on fund prices

It’s important to note that immediately following a distribution, the fund’s price drops by an amount equivalent to the payment. However, you will receive additional units in the fund equal in value to the amount of the distribution. The result is that the value of your investment doesn’t change, you just own more units in the fund at a lower unit price.

For example, assume you own 100 units of a fund valued at $10.00/unit (your investment is worth $1,000). If the fund pays a distribution of $0.10/unit, its price will drop to $9.90 following the distribution. However, if you follow the common practice of reinvesting your distributions, you will receive an additional 1.01 units in the fund ($10.00/$9.90), so the value of your investment remains unchanged (101.01 units x $9.90/unit = $1,000).

Estimated distributions

The estimated distributions for our funds (to be declared on December 16th) are as follows:

• Income Fund: $0.12/unit (bringing the year-to-date total to $0.33/unit) 
• Founders Fund: $0.10/unit (bringing the year-to-date total to $0.24/unit) 
• Builders Fund: $0.09/unit 
• Equity Fund: $1.04/unit 
• Global Equity Fund: $0.06/unit 
• Small-Cap Equity Fund: $1.33/unit 
• Global Small-Cap Equity Fund: $0.03/unit

Please note that these are estimates only and are subject to change.

Important note for investors

If you are considering purchasing units in the funds in a non-registered (taxable) account, you may want to wait until after the distributions are declared. Fund units purchased on or after December 17th will not receive distributions.

If you have any questions about distributions, please call us at 1-888-888-3147.