Moka invests in Exchange-Traded Funds (ETFs) which are used as a low-cost alternative to typical Mutual Funds. ETFs are bundles of stocks, bonds and cryptocurrencies that follow a specific investment strategy. For example, the FTSE Canada Index ETF (VCE) offered by Vanguard tracks the performance of a broad index that measures the investment return of publicly traded stocks in the Canadian market.

Exchange-traded funds include an annual fee that ETF providers use to cover the costs of operating that ETF.

The Management Expense Ratio (MER) represents the combined total of the management fee, operating expenses, and taxes charged to a fund during a given year expressed as a percentage of a fund's average net assets for that year. All mutual funds have a MER.

The ETFs in your Moka investment account have fees that range from 0.05% to 0.38% for regular portfolios and 0.20% to 0.69% for SRI portfolios. The ETF providers charge this fee directly to the fund, not to your account, so while you will not see a charge for this amount, it will slightly reduce the value of your investments. For example, if you were to invest $10.00 in an ETF with an MER of 0.2%, the value of the ETF would be reduced by approximately $0.02 over the course of a year due to MER fees. This kind of fee is charged over and above the performance of the index.

Moka’s trusted partner, Tactex Asset Management, works hard to choose ETFs that have a low MER fee and provide a suitable risk-return profile for Moka users.

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