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BMO GAM Automatic Rebalancing Service - FAQs

Frequently Asked Questions

1. Where can I find the service?

The service is available through iFast Web PLUS. Alternately, a PDF form can be found here. If you are not currently a user of Web PLUS, you can sign up here.

2. What plan types is this service available in?

The rebalancing service is available for all nominee accounts, and all client name accounts except for RESP and RDSP.

3. What account types is the Rebalancing Service available?

The rebalancing service can be set up on both Nominee Name and Client Name Accounts.

4. What signatures are required?

Via Web PLUS:

BMO does not require any signatures to action the request. Advisors may still require client signatures/authorization to be kept on file to satisfy dealer compliance criteria (i.e., Letter of Direction, Limited Trading Authorization, etc.).

Via Form:

The client and their Advisor must sign for Client Name Accounts. Nominee accounts must be authorized by the dealer’s head office to be accepted.

5. What funds are eligible to be held within this service?

Only BMO Investments Inc (BMOII) Mutual Funds that are available for purchase can be held as a part of the rebalancing service.

6. What Frequency can the rebalancing occur on?

The Frequency options are Monthly, Quarterly (March, June, September, December), Semi-Annually (June & December) or Annually (December) and will occur on the 15th of the month. If the 15th is not a business day, the rebalancing will occur on the next business day

7. Are BMO Segregated Funds eligible for rebalancing service?

No, only BMO Mutual Funds are available.

8. Can other fund company’s mutual funds be included in the Rebalancing Service?

No, only BMO Mutual Funds are available.

9. Is the service available for CAD and USD Funds?

While both CAD and USD denominated funds can be held as a part of the service, it is only available in one fund currency per account (i.e., the fund within the portfolio must be all CAD or all USD).

10. Can I hold funds in the same account which are not part of the rebalancing service?

Yes, standalone funds can be held within the same account which will not be rebalanced if not requested.

11. If I choose to fill out the PDF form, how do I submit it?

1. Fax: 1-800-200-2497

2. Mail: Attn BMO Investments Inc 30 Adelaide St E, Suite 1. Toronto ON M5C 3G9

3. Email (if signed up for TLS): bmofunds.documents@bmo.com

12. Can I submit the PDF form online?

Currently the only options to submit the PDF form are listed in Question 9. However, the automatic rebalancing service can also be accessed through iFast Web PLUS.

13. How are the Rebalancing Trades processed?

The rebalancing trades are systematic trades processed by BMOII (The Fund Company) and will appear as Management Company initiated switches.

14. Is there a cost for the Rebalancing Service?

BMOII does not charge any fees* for the service.

*Dealers may have fees associated with these transactions; Advisors should confirm this with their clients if there are any Dealer related fees that are applicable.

15. What happens if one or more of the funds is redeemed from the portfolio?

Rebalancing will still take place on zero balance funds so long as assets are held in other funds that are part of the portfolio.

16. Are redemptions and purchases processed based on the portfolio mix?

No redemptions and purchases are processed based on how the transaction is entered/received by BMOII. There is no rebalancing completed as part of the transaction.

17. Can I rebalance a portfolio outside of the agreed upon frequency?

Yes, instructions would need to be sent manually to BMOII requesting a one time rebalance of the portfolio.

18. Are portfolios rebalanced after a purchase or redemption to one or more of the funds is processed?

No, automatic rebalancing will only occur on the scheduled frequency that was set up. To maintain the portfolio mix it is recommended that purchases and redemptions across funds based on the portfolio mix.

19. Can I specify only a specific portion (or units or dollars) to be included in the rebalancing?

No, the entire balance of funds included in the portfolio will be taken into account when rebalancing.

20. Can I rebalance funds across different accounts?

No, the service is only available at an individual account level and cannot rebalance across multiple accounts. If rebalancing is required across multiple accounts, a separate Web PLUS submission or form will be required for each.

21. Will the rebalancing service trigger dispositions?

Yes, dispositions could be triggered if rebalancing across different funds in non-registered accounts, which could result in capital gains/losses.

22. How can I change or stop the rebalancing service?

Changes to existing rebalancing setups and terminations of the service can be completed using the form, or via Web PLUS.

Disclosures

Commissions, trailing commissions (if applicable), management fees and expenses all may be associated with mutual fund investments. Please read the fund facts or prospectus of the relevant mutual fund before investing. Mutual funds are not guaranteed, their values change frequently, and past performance may not be repeated. Distributions are not guaranteed and are subject to change and/or elimination.

For a summary of the risks of an investment in BMO Mutual Funds, please see the specific risks set out in the prospectus.

BMO Mutual Funds are managed by BMO Investments Inc., which is an investment fund manager and a separate legal entity from Bank of Montreal.

“BMO (M-bar roundel symbol)” is a registered trademark of Bank of Montreal, used under licence.

Follow BMO

“BMO (M-bar roundel symbol)” is a registered trademark of Bank of Montreal, used under licence.

BMO Global Asset Management is a brand name under which BMO Asset Management Inc. and BMO Investments Inc. operate. Certain of the products and services offered under the brand name, BMO Global Asset Management are designed specifically for various categories of investors in a number of different countries and regions and may not be available to all investors. Products and services are only offered to such investors in those countries and regions in accordance with applicable laws and regulations. BMO Financial Group is a service mark of Bank of Montreal (BMO).

BMO ETFs are managed and administered by BMO Asset Management Inc., an investment fund manager and portfolio manager and separate legal entity from Bank of Montreal. Commissions, management fees and expenses all may be associated with investments in exchange traded funds. Please read the prospectus before investing.

Exchange traded funds are not guaranteed, their values change frequently and past performance may not be repeated.

BMO Mutual Funds are managed by BMO Investments Inc., which is an investment fund manager and a separate legal entity from Bank of Montreal.

Commissions, trailing commissions (if applicable), management fees and expenses all may be associated with mutual fund investments. Please read the ETF facts, fund facts or prospectus of the relevant mutual fund before investing. Mutual funds are not guaranteed, their values change frequently and past performance may not be repeated.

For a summary of the risks of an investment in the BMO Mutual Funds, please see the specific risks set out in the prospectus. ETF Series of the BMO Mutual Funds trade like stocks, fluctuate in market value and may trade at a discount to their net asset value, which may increase the risk of loss. Distributions are not guaranteed and are subject to change and/or elimination.

Distribution yields are calculated by using the most recent regular distribution, or expected distribution, (which may be based on income, dividends, return of capital, and option premiums, as applicable) and excluding additional year end distributions, and special reinvested distributions annualized for frequency, divided by current net asset value (NAV). Distributions are not guaranteed, may fluctuate and are subject to change and/or elimination. Distribution rates may change without notice (up or down) depending on market conditions and net asset value (NAV) fluctuations. The payment of distributions should not be confused with a BMO Mutual Fund’s performance, rate of return or yield. If distributions paid by a BMO Mutual Fund are greater than the performance of the investment fund, your original investment will shrink. Distributions paid as a result of capital gains realized by a BMO Mutual Fund, and income and dividends earned by a BMO Mutual Fund, are taxable in your hands in the year they are paid. Your adjusted cost base will be reduced by the amount of any returns of capital. If your adjusted cost base goes below zero, you will have to pay capital gains tax on the amount below zero.

Distributions, if any, for all series of securities of a BMO Mutual Fund (other than ETF Series) are automatically reinvested in additional securities of the same series of the applicable BMO Mutual Fund, unless the securityholder elects in writing that they prefer to receive cash distributions. For further information, see the distribution policy for the applicable BMO Mutual Fund in the simplified prospectus.

Legal and regulatory disclosures

This information is for Investment Advisors only. By accepting, you certify that you are an Investment Advisor. If you are NOT an Investment Advisor, please decline and view the content in the Investor or Institutional areas of the site. The website is for informational purposes only and is not intended to provide a complete description of BMO Global Asset Management’s products or services. Past performance is not indicative of future results. It should not be construed as investment advice or relied upon in making an investment decision. Products and services of BMO Global Asset Management are only offered in jurisdictions where they may be lawfully offered for sale. The information contained in this Website does not constitute an offer or solicitation by anyone to buy or sell any investment fund or other product, service or information to anyone in any jurisdiction in which an offer or solicitation is not authorized or cannot be legally made or to any person to whom it is unlawful to make an offer of solicitation. All products and services are subject to the terms of each and every applicable agreement. It is important to note that not all products, services and information are available in all jurisdictions outside Canada.