Question of the Week: Can I change my mind on a mutual fund purchase?

Sometimes investors change their minds. What if, after purchasing a mutual fund, you feel you have a made a mistake and wish to cancel or withdraw the purchase?

In Nova Scotia investors do have the right to change their minds regarding a mutual fund purchase for a certain period of time.

Under securities laws the mutual fund purchaser can withdraw an agreement to purchase a fund within two business days after receiving the fund’s prospectus.

When it comes to mutual funds, a purchaser can also cancel the purchase within 48 hours upon receiving a confirmation of the purchase going through.

A mutual fund purchase can also be cancelled if disclosure documents such as the prospectus, annual information form, Fund Facts, or financial statements provided contain incorrect information or if the fund dealer did not provide the required information in accordance with securities regulations.

To withdraw or cancel a purchase an investor must act within the time limit set by securities laws. This can differ between jurisdictions so make sure you know what the laws and limits are in your province or territory.