Q: What is the difference between a mutual fund and a segregated fund?
A: Segregated funds are an insurance company’s version of mutual funds. They basically work the same way but have some very structural differences compared to mutual funds.
- Segregated funds come with guarantees to return up to 100% of your original investment in the event of death or market meltdown, subject to certain conditions and provided they are held for a specific period of time. This may be of particular interest to investors who have a lower life expectancy and are concerned about the value of their investments upon their death.