(April 26 – 10:30 ET) – The Ontario Securities Commission is going to allow Mackenzie Financial Corp. to treat its innovative Managed Yield Capital Class funds as money market mutual funds for the purposes of OSC regulatory fees.

Although the funds are pitched as money market alternatives, they actually use options to hedge a portfolio of Canadian equities in order to approximate the rate of return provided by bankers’ acceptances, or the London Interbank Offered Rate. They are not considered money market funds within the meaning of National Instrument 81-102 because they invest in synthetic cash.

Mackenzie argues that the funds are not only positioned as money market alternatives, they are also actually being bought for that purpose. “This is evidenced by the fact that some investors who decide to purchase the Mackenzie Capital Class Funds are placing money into the Managed Yield Funds as a short-term ‘parking spot’ for cash while determining which of the other Mackenzie Capital Class Funds the investor wishes to acquire. This also is evidenced by the fact that some investors are purchasing the Managed Yield Funds primarily to obtain the rate of return set out in the investment objectives sections of Prospectus for such funds.”

The OSC agrees with Mackenzie, allowing the funds to pay the fees applicable to money market mutual funds.