Advising-familly

For the ninth year in a row, mutual funds lead the way when it comes to investor confidence, finds an IFIC survey. And investors are looking for choice when it comes to paying for advice.

The survey asked mutual fund owners to rank their confidence in the ability of various financial products to help them achieve their financial goals.

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“Again this year, Canadian mutual fund investors have expressed higher confidence in the ability of mutual funds to achieve their financial goals than in other products tested,” says IFIC president and CEO, Joanne De Laurentiis. “Confidence in mutual funds has continued to improve steadily since 2009, and is now again in line with the confidence levels of 2006.”

In the 2014 survey, mutual funds achieved an 85% confidence level compared with 65% for stocks, 64% for GICs, 55% for bonds, and 34% for ETFs.

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Confidence in advisors also remains high with 98% of those surveyed agreeing they trust their advisors to give them sound advice and 92% that they obtain better returns than they would if investing on their own.

Additional findings include:

  • 54% support the prevalent Canadian model of paying through embedded fees, while 38% would prefer a direct payment to the advisor; and
  • 95% of mutual fund investors have discussed their comfort level with investment risk with their advisor, and are satisfied with their advisor’s original and ongoing understanding of their risk tolerances.

Read: Be frank about fees

De Laurentiis adds, “Investor … are driven by the quality of clients’ relationships with their advisors and the savings they are able to build. That is why the industry is eager to successfully introduce the new disclosure regime known as CRM2. We believethe new rules will further enhance advisor/client conversations and support investor confidence.”

Originally published on Advisor.ca

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