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Amendments to National Instrument 81-101: Mutual Fund Risk Classification Methodology [Completed]

Proposed effective date:

Provided all necessary Ministerial approvals are obtained, the amendments will come into force on March 8, 2017.

Last updated:

December 2016

Overview

On December 8, 2016, the CSA published final amendments that require fund managers to use a standardized CSA mutual fund risk classification methodology (the Methodology) to determine the investment risk level of conventional mutual funds and exchange-traded mutual funds (ETFs) (collectively referred to as “mutual funds”) in the Fund Facts and ETF Facts, respectively.

Previously, the CSA had published for comment proposed amendments introducing the Methodology in December 2015 (the 2015 Proposal). The majority of commentators supported the implementation of a standardized and mandatory risk classification methodology to determine a mutual fund’s investment risk level on the risk scale in the Fund Facts and the ETF Facts. After considering the comments received, the CSA made some non-material changes to the 2015 Proposal.

Provided all necessary Ministerial approvals are obtained, the amendments will come into force on March 8, 2017. Starting September 1, 2017, the investment risk level of conventional mutual funds and ETFs must be determined by using the Methodology for each filing of a Fund Facts or ETF Facts, and at least annually.

Recent activities

December 2016

On De­cem­ber 8, 2016, the CSA published final amendments that require fund managers to use a standardized CSA mutual fund risk classification methodology to determine the investment risk level of conventional mutual funds and exchange-traded mutual funds.

December 2015

On December 10, 2015, the CSA published for comment proposed amendments that would require fund managers to use a standardized risk classification methodology when determining a risk level for conventional mutual funds and exchange-traded mutual funds (ETFs) in the Fund Facts and in the proposed ETF Facts, respectively.

December 2013

On December 12, 2013, the CSA issued for public comment its Notice 81-324, Request for Comments Proposed CSA Mutual Fund Risk Classification Methodology for Use in Fund Facts.

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