Canadian Investor FAQs

BMG BullionFund, BMG Gold BullionFund and BMG Silver BullionFund are available in all ten Canadian provinces, and the three Territories. BMG Funds can be purchased through your registered mutual fund dealer, securities dealer, if you have a discount brokerage account at any of the major discount brokerages (TD, BMO, RBC, CIBC, Scotiabank and Questrade) you can place the order directly. Fund Codes are: BMG BullionFund Class A CAD: BMG100 (A-FE), BMG104  BMG BullionFund Class A US: BMG101 (A-FE). BMG105  BMG BullionFund Class F CAD: BMG600 BMG BullionFund Class F US: BMG601 BMG BullionFund Class D CAD: BMG130 BMG Gold BullionFund Class A CAD: BMG200 (A-FE), BMG204  BMG Gold BullionFund Class A US: BMG201 (A-FE). BMG205 BMG Gold BullionFund Class F CAD: BMG202 BMG Gold BullionFund Class F US: BMG203 BMG Gold BullionFund Class D CAD: BMG230 BMG Silver BullionFund Class A CAD: BMG400 (A-FE), BMG404 BMG Silver BullionFund Class A USD: BMG401 (A-FE), BMG405 BMG Silver BullionFund Class F CAD: BMG402 BMG Silver BullionFund Class F USD: BMG403 BMG Silver BullionFund Class D: BMG430 If your financial advisor is not registered to sell BMG Funds, please have them contact client services toll-free at 1 866.241.6484 with their dealer rep code. 

Units of BMG BullionFund,BMG Gold BullionFund and BMG Silver BullionFund can be purchased through a properly licensed mutual fund dealer, securities dealer, or discount broker. Accredited Investors can purchase Class E units of BMG Funds directly through subscription to BMG Marketing Services Inc., or through other exempt market dealers. BMG also offers Class D units of BMG Funds through Discount Brokerage platforms for the “do-it-yourself” investors. The investor does not receive investment or financial advice. BMG’s  Class D units have a total management fee of 1.25%. No sales charges apply when you buy or sell  Class D units of the BMG Funds. Instead, you may have to pay a fee directly to the discount broker.

Investors in Class D units enjoy lower management fees with the benefit of making their own investment decisions. There are no additional fees to switch to Class D from any other class of the same BMG Fund.

Please contact us at fundinfo@bmg-group.com or 1.888.474.1001 for further information.

The minimum purchase for either BMG BullionFund, BMG Gold BullionFund or BMG Silver BullionFund is $1,000.

The fees vary. Please contact your financial advisor for more details. A BMG representative will be happy to recommend an advisor with in-depth knowledge of the precious metals markets.  Contact us for more information.

BMG BullionFund, BMG Gold BullionFund and BMG Silver BullionFund are tracked by Cannex, Bloomberg, Globefund, Morningstar Canada, and Fundata Canada. You can also obtain the unit values on our website: BMG Funds in Canadian and US dollars, along with actual ounces held of the three metals, and other statistics. Please note that neither BMG Fund is valued on Canadian or UK holidays.

Units of BMG BullionFund, BMG Gold BullionFund and BMG Silver BullionFund   can be liquidated on any regular business day. Under normal circumstances, settlement takes two days.

BMG BullionFund,BMG Gold BullionFund and BMG Silver BullionFund are eligible for all Canadian registered plans.. BMG Funds currently qualify as mutual fund trusts. Based on the current holdings of the Funds and their investment policies, they will retain their status as mutual fund trusts for purposes of the Income Tax Act (Canada) even if a majority of their units is owned by non-residents of Canada. The fact that non-residents may invest in BMG Funds will have no adverse tax consequences under the Income Tax Act (Canada) to an individual resident in Canada who holds units of a class of BMG Funds, or to a registered plan such as an RRSP, RRIF, DPSP, TFSA, RESP or RDSP.

If you do not already have a self-directed RRSP, you can set up an RRSP with BMG Management Services Inc. (BMS). Your broker or financial advisor can assist you with the paperwork. Once established, you can transfer funds from your existing RRSP to your RRSP with BMS, and your financial representative can purchase units of BMG BullionFund,or BMG Gold BullionFund and/or BMG Silver BullionFund for your RRSP. BMG Funds offer RRSPs (including Locked-in RSPs and LIRAs), and RRIFs (including Life Income Funds), Prescribed Retirement Income Funds, Locked-in Retirement Income Funds and Tax-Free Savings Accounts. The trustee of our registered plans is The Royal Trust Company. There is no charge to the investor for the annual trustee fee.

BMG BullionFund uses at least 95 percent of the proceeds it receives from investors to purchase equal dollar amounts of gold, silver and platinum bullion. BMG Gold BullionFund uses at least 95 percent of the proceeds it receives from investors to purchase gold bullion. BMG Silver BullionFund uses at least 95 percent of the proceeds it receives from investors to purchase silver bullion. All BMG Funds purchase bullion at the prevailing spot price each day the market is open. Neither Fund invests in futures contracts, futures options, precious metals certificates, or mining company shares.

By including all three metals in BMG BullionFund, it increases portfolio diversification and  long-term rates of return should be enhanced. For investors who want an exposure to gold alone, we offer BMG Gold BullionFund and for those wanting exposure to silver alone, we offer the BMG Silver BullionFund.

Neither the BMG BullionFund,BMG Gold BullionFund or BMG Silver BullionFund use derivatives or invest in securities or certificates of companies that produce gold, silver or platinum bullion. BMG Funds do not invest in pooled accounts, futures contracts, futures options or precious metals certificates.

If a particular precious metal is not available, BMG BullionFund will purchase those precious metals that are available on an equal basis, and the Fund’s exposure to all three precious metals will be adjusted as soon as possible.

The intention was to create investment vehicles that preserve all the benefits of holding precious metals in bullion form. As open-end funds, there is no limit to the amount of assets BMG Funds can acquire. As more units are subscribed for, equal dollar amounts of gold, silver, and platinum bullion are purchased by BMG BullionFund, gold is purchased by BMG Gold BullionFund and silver is purchased by BMG Silver BullionFund. As open-end mutual fund trusts, the Funds are always valued daily at their Net Asset Value (NAV), and can never trade at a premium or discount. Units in the Funds are purchased or redeemed at NAV rather than traded between investors. As such, the liquidity of the Funds is that of the global bullion markets themselves, rather than the daily trading volume of a particular Fund, as is the case with closed-end funds. Because of the high degree of liquidity in precious metals, there is little risk of either Fund losing value if there is an excess of redemptions, or any risk of suspension of redemptions. Precious metals trade 24 hours a day on every regular business day around the world, and have the same liquidity as major currencies.

BMG Funds never leases, lend or borrow gold, silver or platinum at any time. No options, certificates, derivatives, or futures contracts are used in either Fund.

BMG BullionFund,BMG Gold BullionFund and BMG Silver BullionFund do not compromise the three fundamental attributes of bullion: liquidity, no counterparty risk and independent of management skills. As such, we do not hedge the Canadian dollar, or any currency, at any time, and options, certificates, derivatives, and futures contracts are never used in either Fund. Download The Fundamental Attributes of Gold, Silver and Platinum Bullion to learn more.

There is no difference between the holdings, investment criteria or objectives of BMG Funds’ classes. The different classes are simply a way of categorizing the different methods of commission or fee structure charged. Class A is for retail investors, and Class F is for fee-based accounts. Class E is for accredited investors, and Class G is for international investors. Class D is through Discount Brokerage platforms for the “do-it-yourself” investors

BMG BullionFund, BMG Gold BullionFund and BMG Silver BullionFund are subscribed and redeemed at a rate equal to the NAV per unit price of the Fund in question.  BMG Funds do not trade as closed-end investments do, and hence cannot be bought or sold at a premium or discount. Units are purchased or redeemed at the prevailing NAV, without premium or discount.

BMG BullionFund is suitable for those with a medium-to-high risk tolerance and the BMG Silver BullionFund is suitable for those with a high risk tolerance, whereas the BMG Gold BullionFund is for those with a medium risk tolerance. The BMG Funds are not intended to be a stand-alone investment, and should not represent more than 20% of an investor’s overall total investment portfolio including any other bullion investments. Due to the fact that bullion typically has a low correlation to other financial assets, including it as part of a portfolio should generally reduce the portfolio’s volatility and may improve portfolio returns over the long term.

The value of a class of a Fund (the Net Asset Value (NAV) per unit of a class) is determined in Canadian dollars at the close of business (EST) (the valuation time) on a day when the Toronto Stock Exchange is open for trading (a business day and a valuation date), and is equal to the assets of that class of the Fund minus the liabilities of that class of the Fund divided by the number of units of that class of the Fund that are outstanding. The assets of each class of a Fund will be valued, as applicable, as follows:

• the value of gold, silver and platinum bullion will be priced based on available spot prices;
• any cash and subscription receivables will be valued at their face value; and
• all assets of a Class of a BMG Funds carried in foreign currency will be translated into Canadian currency for valuation purposes as nearly as practicable using the best sources available to BMS and/or the applicable service provider, including its affiliates, on the Valuation Date on which the NAV of that Class of a BMG Fund is calculated.

BMG BullionFund, BMG Gold BullionFund and Silver BullionFund are open-end mutual fund trusts that invest in bullion itself, not in the shares of mining companies. A greater degree of risk and volatility is involved in the ownership of shares, as opposed to investing in actual bullion. The risk exposure of mining companies compares closely to the risk exposure in any equity investment. Physical bullion cannot be subject to accounting fraud, and is the only asset that is not someone else’s liability and does not represent a mere promise to pay, such as the dollar or a stock certificate, etc. Also, during the financial crisis of 2008, Canadian mining stock mutual funds lost between 25 percent and 55 percent, whereas BMG BullionFund lost only 4 percent. From a portfolio diversification point of view, conventional precious metals mutual funds form part of the equity portion of a portfolio. BMG Funds represent a separate asset class that should form the foundation of the cash component of a portfolio.

BMG Funds do not compromise the three fundamental attributes of bullion: liquidity, no counterparty risk and independent of management skills. All of our competitor funds compromise at least one of these attributes.

Returns  are based on the future price of gold, silver and platinum for BMG BullionFund, the future price of gold for BMG Gold BullionFund and the future price of silver for the BMG Silver BullionFund, both in Canadian dollars. The value of each BMG Fund, and hence, an investor’s return, varies with the price of the three precious metals in Canadian dollars. The BMG Funds’ prices are negatively correlated to the world’s major currencies. If currencies decline through debasement, we would expect BMG Funds to advance.

A small portion of assets (no more than 5 percent) may be held in cash to allow each Fund to pay expenses and to facilitate any redemption of units.

Bank of Montreal (BMO), as custodian for the physical bullion assets of the BMG Funds, holds physical custody of gold and platinum bullion, on an allocated and insured* basis, while Brink’s Canada Limited (Brink’s), holds physical custody of the silver bullion, on behalf of the BMG Funds’.  BMO may not appoint a sub-custodian for this purpose without the prior consent of the Fund Manager, BMG Management Services Inc for the BMG Funds. * ”Insured basis” refers to certain insurance covering the storage of the physical bullion with  (BMO), and does not refer to insurance related to a loss in market value of the underlying holdings

With each purchase of precious metals, a confirmation trade is sent by BMO, a primary bullion dealer.  BMO delivers the purchased bullion to BMG BullionFund, BMG Gold BullionFund and/or BMG Silver BullionFund, and it is stored on an allocated and insured basis in the Custodian’s vault. The Custodian sends both the Trustee and the Administrator details confirming the weight to three decimal place, refiner, and serial number of each bar. Additionally, at the end of every month, the Custodian furnishes an updated list of gold, silver, and platinum bars held for each Fund.

In addition, as part of the annual audit, the Fund Managers auditor, RSM Canada LLP, physically counts the bars held on behalf of BMG Funds in the Custodian’s vault facilities, and confirms the bullion holdings for the annual financial statements.

*”Insured basis” refers to certain insurance covering the storage of the physical bullion with the BMG Funds’ Custodian, and does not refer to insurance related to a loss in market value of the underlying holdings.

With a Management Expense Ratio (MER) to consider, you might think it would be cheaper to purchase bullion and store it at home or in a safety deposit box, but there are several factors to consider. First, while it is certainly possible to purchase bullion from chartered banks or online bullion companies, these companies charge a premium on bullion, and it can be substantial. Premiums of 4 percent for gold, 15 percent for silver and 8 percent for platinum are typical, and they can be higher during shortages. Selling bullion back to these companies will also result in a price that is discounted from the spot price. Over the three metals, the net premium and discount for buying and then reselling bullion can be as high as 15 percent. Second, the precious metals bullion comprising BMG BullionFund, BMG Gold BullionFund and BMG Silver BullionFund are held in storage and covered by insurance that covers many risks associated with that storage. Storing bullion at home comes with its own risks. There is the cost of a home safe, storage space issues and the risk of the bullion being stolen. Insurance companies do not provide coverage for bullion stored either in a safety deposit box or in a home safe. Even with an MER of just over 3 percent, it is less expensive to hold bullion in BMG Funds. If you were to forgo the insurance and hold bullion at home, the premiums and discounts you have to pay makes holding physical bullion unattractive compared to BMG Funds, which purchase physical precious metals at close to spot price.

The overall costs of buying and holding units of BMG BullionFund,  BMG Gold BullionFund and BMG Silver BullionFund are competitive when compared with most equity funds, even though the costs associated with hard assets are not comparable to those for paper assets. The expenses incurred by BMG Funds exceed the costs of mutual funds that hold stocks or derivatives of physical bullion. BMG Funds are an extremely cost-effective method of owning bullion when compared to purchasing coins or bars from a dealer and arranging and paying for private storage.

BMG BullionFund holds only allocated gold, silver and platinum bullion, with the limited objective of providing a secure, convenient, low-cost, alternative for investors seeking to hold gold, silver and platinum bullion for capital preservation and long-term appreciation. BMG Gold BullionFund holds only allocated gold bullion and BMG Silver BullionFund only holds allocated silver bullion.

As a result, the following risk factors are associated with investing in the Funds:

Precious Metals Risk The prices for gold, silver and platinum bullion are affected by a variety of factors, including changing supply and demand relationships and international political and economic events. In addition, governments may intervene from time to time, directly and by regulation, in certain markets such as precious metals. These factors will indirectly affect the prices for gold, silver and platinum bullion. Direct purchases of gold, silver and platinum bullion may generate higher transaction and custody costs than other types of investments.
Availability of Precious Metals Risk It is possible that BMG BullionFund may not be able to buy gold, silver or platinum bullion from time to time. In such a situation, BMG BullionFund will continue to purchase those metals that are available, but will not be able to achieve its investment objective of holding equal amounts of all three precious metals until all three metals become available again.
Foreign Currency Risk Gold, silver and platinum bullion are usually traded in US dollars and, as a result, BMG Funds are vulnerable to foreign currency risk, which is the risk that the value of the Canadian dollar will increase as measured against a foreign currency. For example, a precious metal traded in US dollars will fall in value, in Canadian dollar terms, if the Canadian dollar increases in value relative to the US dollar, even though there is no change to the US dollar value of the precious metal. Conversely, if the Canadian dollar falls in value relative to the US dollar, there is a corresponding gain in the value of the precious metal measured in Canadian dollars attributable solely to the change in the exchange rate. BMG Funds do not intend to hedge their foreign currency exposure.
Non-Hedging Strategy Risk BMG Funds will not invest in derivatives to protect against decreases in the value of gold, silver or platinum bullion.
Specialization Risk BMG BullionFund will hold only gold, silver and platinum bullion, while BMG Gold BullionFund will hold only gold and BMG Silver BullionFund will hold only silver. As a result, investors should allocate only a percentage of their portfolio to BMG Funds in order to maintain an appropriate level of diversification.
Management Risk BMG Management Services Inc. is not registered as a portfolio manager, and for this reason BMG Funds have fixed investment policies.
Uninsured Losses Risk RBC Investor Services Trust, as Custodian, holds physical custody of the gold, silver and platinum bullion assets of BMG Funds on an allocated and *insured basis. The Custodian is obliged to maintain insurance satisfactory to BMG Funds against all risk except the risk of war, nuclear incident or government confiscation. *”Insured basis” refers to certain insurance covering the storage of the physical bullion with the BMG Funds’ Custodian, and does not refer to insurance related to a loss in market value of the underlying holdings.
Tax Risk It is anticipated that, for the purpose of computing its income under the Income Tax Act (Canada), each Fund will generally treat gains (or losses) as a result of dispositions of physical gold, silver and platinum bullion, as applicable, as capital gains (or capital losses), although depending on the circumstances, they may instead include (or deduct) the full amount of such gains in computing their income. If any transactions of a Fund are reported by it on capital account but are subsequently determined by the Canada Revenue Agency to be on income account, there may be an increase in the net income of that Fund for tax purposes and the taxable component of redemption proceeds (or any other amounts) distributed to unitholders, with the result that Canadian-resident unitholders could be reassessed by the Canada Revenue Agency to increase their taxable income by the amount of such increase, and non-resident unitholders potentially could be assessed directly by the Canada Revenue Agency for Canadian withholding tax on the amount of net gains on such transactions that were treated by the Canada Revenue Agency as having been distributed to them. The Canada Revenue Agency can assess a Fund for its failure to withhold tax on distributions made by it to non-resident unitholders who are subject to withholding tax, and typically would do so rather than assessing the non-resident unitholders directly. Accordingly, any such re-determination by the Canada Revenue Agency may result in the Funds being liable for unremitted withholding taxes on prior distributions made to unitholders who were not resident in Canada for the purposes of the Income Tax Act (Canada) at the time of the distribution. As the Funds may not be able to recover such withholding taxes from the non-resident unitholders whose units were redeemed, payment of any such amounts by the Funds would reduce the Net Asset Value of the units of the Funds.

Many factors account for the variable between precious metals prices and the prices of BMG BullionFund, BMG Gold BullionFund and BMG Silver BullionFund. The Net Asset Value (NAV) per unit for BMG Funds is set via the London Fix price for gold, silver and platinum each day, based on the closing prices for each metal and the prevailing exchange rate. Any investment funds received before 4:00 pm EST will be allocated the appropriate number of units based on the end-of-day NAV. The price of the metals would have fluctuated throughout the day, and the London Fix may be considerably different from the high, the low or the average price. This occurs with all funds; however, with traditional funds that have numerous investments, it is not apparent. BMG Funds receive money in both Canadian and US dollars, but always purchase bullion in US dollars, and so incur currency conversion costs. Hedging is something we do not employ due to the added risks and/or costs. Once hedging is employed, the Funds stop being bullion and become dependent on the manager’s hedging skills. Bullion is liquid, incurs no counterparty risks, and does not depend on a manager for performance. Hedging would compromise two of these attributes. To employ a hedging strategy and add risk to an asset that is acting as a hedge against currencies defeats the purpose of investing in bullion. BMG Funds are the purest bullion funds available because they maintain the three fundamental attributes of bullion. BMG Funds, and indeed all other mutual funds, do not have access to an investors’ deposit to the Trust Account for three days, even though the price of the units purchased was set on the day of investment. Precious metals are purchased when an investor’s funds have cleared and are transferred from the Trust Account. Three days later, the price of the metals and the exchange rate can be higher or lower. Even on a daily basis, prices fluctuate. The prices paid for the metals during the day can be higher or lower than that day’s London PM fix. There could also be an exchange rate differential, as that too varies throughout the day. The prices paid for the metals are the ask prices. No one can buy at the spot price, be it the NYMEX close or the London Fix, in the same way that no one can buy at the last closing price in a stock. Based on this, comparing to spot is unrealistic. There is a bid/ask spread. The ask prices for each metal in a rising market are higher than spot, and lower than spot in a falling market. Here again, there is a differential between the NAV per unit that is based on the London Fix each day. This price does not necessarily represent the average price, can be dramatically different from the high or the low for the day and does not correspond to the actual prices paid by BMG Funds. In addition to the ask price there are transaction costs, including bar charges and insured delivery. BMG Funds do not pay any commissions, nor is there any mark-up over cost. The full amount of each deposit received is not necessarily used to purchase precious metals. Some cash – no more than 5 percent – is held aside for expenses and to meet small redemption requests. Currently the cash component is approximately 1 percent. The amount of cash is monitored relative to the expenses and redemption requests. Not keeping a minimal percentage in cash would increase overall costs due to selling costs incurred to meet redemption requests. When BMG Funds sell precious metals, they can only receive the bid prices at the time, not yesterday’s spot price. The above factors are fundamentally similar for all mutual funds, including BMG Funds. As such, it is nearly impossible for the percentage change in BMG Funds’ NAV per unit to be exactly the same as the daily London Fix price for gold, silver and platinum in Canadian dollars. The spot prices are simply a theoretical guideline that cannot correspond to the day-to-day realities, even if you were buying the metals directly outside of either Fund. Buying the metals directly on a retail basis would cost an average of 7 percent above the ask price, plus bar charges. In addition, charges for delivery, delivery insurance, and storage would be incurred. In effect, BMG Funds provide a tremendous value proposition for investors to own investment-grade bullion in a cost-effective and convenient manner.

Yes. As mutual fund trusts, BMG BullionFund, BMG Gold BullionFund and BMG Silver BullionFund are separate legal entities whose assets are separate and distinct from BMG Management Services Inc., BMG Funds’ Manager and Trustee, are separate and distinct from the assets of BMO), the Custodian for all Funds. As a result of these arrangements, BMG Funds’ bullion is secure from third-party claims and held solely for the benefit of BMG Funds’ unitholders. BMG Funds’ bullion holdings cannot be co-mingled with holdings of BMO, or holdings of anyone else. BMG Funds’ assets are not subject to seizure by creditors of either BMO or of BMG Management Services Inc.

RBC Investor & Treasury Services (RBC I&TS) is the Custodian for BMG Funds cash assets and has been providing back-office services since 2004. 

The Administrator of BMG BullionFund, BMG Gold BullionFund and BMG Silver BullionFund is RBC Investor & Treasury Services (RBC I&TS), a division of the Royal Bank of Canada. RBC I&TS administers in excess of US$2 trillion on behalf of mutual funds and hedge funds on a global basis. It is responsible for all BMG Funds’ accounting, calculation of the Net Asset Value (NAV), NAV per unit and the unitholders register.  In addition, RBC I&TS is the custodian/administrator of BMG Funds’ bank accounts, and is responsible for BMG Funds’ banking, record-keeping, daily valuation and processing of all purchases and redemptions. Only RBC I&TS has signing authority on the BMG Funds’ accounts.

The BMG Funds’ assets are held in allocated storage and insured and are not subject to seizure by creditors of either the Custodian or of the BMG Funds’ Manager. The Custodian cannot appoint a Sub-Custodian without approval of the Manager.  A Sub-Custodian would have to meet requirements set out in National Instrument 81-102. The Custodian has no authority to lease or encumber any of the BMG Funds’ assets.  The BMG Funds’ precious metals cannot be co-mingled with RBC Investor Services Trust holdings or the Bank’s other clients. As a mutual fund trust, the BMG Funds are a separate legal entity whose assets are separate and distinct from the fund management. In the unlikely event that RBC Investor Services Trust became insolvent; the assets of the BMG Funds would not be available to its creditors. In that scenario, the trustee would simply appoint another Custodian and move the BMG Funds’ assets to the new Custodian’s designated facility. If the BMG Funds’ manager, BMG Management Services Inc. (BMS), became insolvent the BMG Funds’ assets would stay in place and would not be subject to seizure by any creditors of BMS. A new trustee/manager would be appointed or the BMG Funds can be wound up, with the proceeds distributed to its unitholders. If, for some reason, the BMG Funds were wound up, the assets would be sold and the proceeds distributed to unitholders after expenses of the BMG Funds were paid. None of the liabilities of BMS could be paid with these proceeds. The BMG Funds’ expenses might include trustee fees, accounting costs, storage cost and insurance. Unlike traditional liquidations, there would be no distress discount due to a forced liquidation of the bullion.  The precious metals would still be worth the prevailing spot price, thereby retaining their value to unitholders. Because of the high degree of liquidity in precious metals, there is little risk of the BMG Funds losing value if there is an excess of redemptions or any risk of suspension of redemptions.  Precious metals trade 24 hours a day around the world and are as liquid as US dollars. 

CIPF Members are Dealer Members of the Investment Industry Regulatory Organization of Canada (IIROC). In the unlikely event that the Member you are dealing with becomes insolvent, CIPF will ensure the securities, cash and other property that are held in your account are returned to you in accordance with their Coverage Policy.

In the unlikely event that RBC Investor & Treasury Services (RBC & I&TS) declared bankruptcy, the assets of BMG BullionFund, BMG Gold BullionFund and BMG Silver BullionFund would not be available to creditors. In that scenario, the Trustee would simply move the assets to another bank’s facilities. If BMG Funds’ manager, BMG Management Services Inc. (BMS), were to declare bankruptcy, the assets would stay in place at RBC Investor Services Trust, and would not be subject to seizure by any creditors of BMS. A new Trustee/Manager would be appointed, or BMG Funds could be wound up, and the proceeds distributed to its unitholders. If for some reason BMG Funds were wound up, their assets would be sold and the proceeds distributed to unitholders after the expenses of BMG Funds were paid. None of the liabilities of BMS could be paid with these proceeds. BMG Funds’ expenses might include trustee fees, accounting costs, storage costs and insurance premiums. Unlike traditional liquidations, precious metals held by BMG Funds would not be sold at a discount, as is the case in most liquidations, because the bullion holdings would still be worth the prevailing spot price, thereby retaining their full value at the time.

There are stringent procedures in place to prevent fraud and any possible misappropriations of the assets of BMG BullionFund, BMG Gold BullionFund and BMG Silver BullionFund: 

Custodian Bank of Montreal (BMO), Toronto, Ontario for the physical bullion assets. RBC IS Toronto, Ontario for the BMG Funds’ non-bullion assets (cash). 

Registrar BMG Management Services Inc., Markham, Ontario is the Registrar, Trustee and Fund Manager for BMG Funds. 

Administrator RBC Investor & Treasury Services (RBC I&TS), Toronto, Ontario the Administrator provides administration services to BMG Funds. 

Auditor RSM Canada LLP, Toronto, Ontario, examines and approves the annual financial statements of BMG Funds, and expresses an opinion thereon. The auditor also performs a physical count of the bullion held in each Fund on an annual basis.

 Independent Review Committee The Independent Review Committee (IRC), of BMG Funds provides independent oversight and impartial judgment on conflicts of interest involving each respective Fund. Among other matters, the IRC prepares, at least annually, a report of its activities for investors in each Fund that is, or will be, available on our website at https://bmgfunds.com/bmg-mutual-funds/financial-reports-filings-forms/ or upon request by any investor, at no cost, by calling: 905.474.1001 or toll-free at 1.888.474.1001, or e-mailing: info@bmg-group.com. The IRC is currently comprised of three members, each of whom is independent of BMG Management Services Inc., its affiliates and BMG Funds. Additional information about the IRC, including the names of its members, and governance of each Fund, is available in the Simplified Prospectus of the BMG Funds. In addition, the auditors of BMG Funds may not be changed without the approval of it’s Fund Manager in conjunction with the IRC in accordance with National Instrument 81-107 Independent Review Committee for Investment Funds. A written notice describing the change in auditors is sent to unitholders at least 60 days before the effective date of the change.

 

BMG Group Inc., is an affiliate member of The London Bullion Market Association (LBMA) and only purchases ‘Good Delivery’ bars for its programs, ensuring all precious metals are SRI. The LBMA Good Delivery List is now widely recognized as representing the de facto standard for the quality of gold and silver bars, in large part thanks to the stringent criteria for assaying standards and bar quality that an applicant must satisfy in order to be listed. The assaying capabilities of refiners on the Good Delivery List are periodically checked under the LBMA’s Proactive Monitoring program. Investors can read the LBMA “Responsible Gold Guidance” investment guidelines.

The London Bullion Market Association (LBMA) is the international trade association that represents the market for gold and silver bullion, which is centred in London, England but has a global client base, including the majority of the central banks that hold gold, private sector investors, mining companies, producers, refiners and fabricators. The current membership stands at 145 member companies across more than 20 countries around the world.

The LBMA has set up a Responsible Gold Guidance for Good Delivery Refiners in order to combat systemic or wide-spread abuses of human rights, to avoid contributing to conflict, to comply with high standards of anti-money laundering, and to combat terrorist financing practices. This Guidance formalizes and consolidates existing high standards of due diligence among all LBMA Good Delivery Refiners.

Gold is often misunderstood. Many advisors and media sources claim it’s a poor investment because it doesn’t pay interest or dividends, or they view it as too volatile. But that misses the bigger picture—gold isn’t just an investment. Gold is money.

Holding physical gold bullion is not the same as investing in stocks or bonds. Like storing cash in a vault, storing gold doesn’t generate income—but it also carries no counterparty risk. The key difference is that gold tends to hold or even increase its purchasing power over time, while paper currencies lose value due to inflation and government deficit spending.

Unlike fiat money, gold can’t be printed or devalued. It’s a stable store of value, especially during times of economic uncertainty. In fact, many banks—particularly central banks—treat gold as a form of currency, not just a commodity. That’s why it’s traded as a currency in global markets.

Gold’s role isn’t to generate income—it’s to preserve wealth.

Gold is money, not a commodity as many investors and advisors incorrectly view it. Gold trades on the currency desks of the major banks and brokerage houses, not the commodity desks. It is a wealth-protecting asset, not a wealth-accumulating asset. We buy and hold gold bullion to preserve wealth. It is important to note that, while we may speculate in gold stocks, exchange-traded funds, futures and options to increase wealth, it is gold bullion ownership that best serves the purpose of wealth protection.

Gold is often called “honest money” because it holds its value and provides a reliable benchmark for pricing goods and services. Unlike paper money or digital currencies, gold has intrinsic worth—it’s valuable in and of itself.

Fiat currencies, on the other hand, have no inherent value. They rely entirely on trust and can lose purchasing power when too much is printed. Gold can’t be created out of thin air, which is why its value remains stable over time.

To be considered true money, something must be portable, divisible, rare, durable, and able to store value. Gold and silver meet all these criteria—and they’ve held their value for thousands of years. Paper currencies may come and go, but precious metals endure.

Gold, silver, and platinum don’t depend on banks, governments, or digital systems. They’re not subject to default or inflation in the same way fiat money is. That’s why they’re often seen as the ultimate protection—and the final settlement—when it comes to wealth.