These are investment fund securities issued by a labour organization or a financial institution. They provide investors with tax benefits.

The funds invest a portion of their assets in start-ups or small and medium-sized enterprises (SMEs) in order to create or maintain jobs.

Expected return

Securities can generate returns in the form of capital gains (losses). The benefit to the investor will partially depend on the resulting tax benefits.

Liquidity

Shares in labour-sponsored funds must be retained until the age of 65 years or the time of retirement or early retirement, i.e. at 55 years of age. Certain conditions apply.

Shares can also be redeemed in exceptional circumstances. These include: purchase of a property, pursuing education, loss of employment or launch of a business, disability or terminal illness.

Another type of available fund is a regional development fund, the shares of which are redeemable after being held seven years, unless an exceptional event occurs such as death, disability or terminal illness.

Risk: medium to high

These funds invest a major proportion of their assets in start-ups or small and medium-sized enterprises.