Saturday, September 28, 2013

Retirees : Do they Face an Advice Gap?

Retirees have special needs and issues. Instead of being in the accumulation phase of investing , they are in the distribution phase. Taxation is a bigger issue. Obtaining competent financial advice is a challenge. Read the full article 

Thursday, September 12, 2013

Do Financial Advisors add value after costs?

Article discusses the challenges of selecting a Financial advisor and the types of value-add that are possible. Appropriate cautions are highlghted  . Read the full article 

Friday, August 23, 2013

Suitability from a Retiree Perspective

The suitability of an investment for someone in their thirties is unlikely to be the same as a person that is retired.Retirees have different objectives , reduced loss capacity and are subject to several constraints. Advisers, compliance officers and complaint investigators do not seem to account for the unique characteristics of retirees in assessing suitablity . Read the full article    

Saturday, August 3, 2013

Sample Investment Policy Statement (IPS)

An Investment Policy Statement ("IPS") is a document, generally between an investor and his/her advisor , recording the agreements the two parties come to with regards to issues relating to how the investor's money is to be managed.The presence of an IPS helps to clearly communicate to all relevant parties the procedures,investment philosophy , guidelines and constraints to be adhered to by the parties. It can be seen as a directive from the client to the advisor  about how the money is to be managed, but at the same time the IPS should provide the guidelines for all investment decisions and responsibilities of each party. As a policy document rather than an implementation directive, the IPS should provide guidance for how investment decisions will be made; it should not be a list of the specific securities to be used; sometimes it includes prohibited securities though. A good sample IPS provided by Weighhouse can be found here  

Thursday, August 1, 2013

White Paper : A Case for Index Fund Portfolios

White Paper : A Case for Index Fund Portfolios . This paper makes a poweful case for using index funds. It contains some other surprising results, none of which are good news for actively-managed funds. Read the full Research paper

Wednesday, July 31, 2013

The Best interest standard and the Elderly

The Best interest standard and the Elderly  . Covers all the major issues related to senior investor protection. Read the full article

Thursday, July 4, 2013

The Great Debate- Should trailer Commissions be Prohibited?

The Great Debate- Should trailer Commissions be Prohibited?This paper discusses the issues from an investor perspective. Read the article

Monday, July 1, 2013

Investors Guide to Effective Complaints

Investors Guide to Effective Complaints provides a detailed approach to making complaints about your investment dealer/ dealer Representative. It shows you what you need to do to lodge an effective complaint that will bring results. Too many people don't realize they have valid complaints and that restitution for undue losses may be in order. The complaint journey is seldom pleasant but this Guide will help make it a little less bumpy. Read the Guide

Sunday, June 30, 2013

RESEARCH :The Financial Education Fallacy

RESEARCH :The Financial Education Fallacy by Lauren E. Willis
Suggests that investor education could be a cover for industry wrongdoing .  Read the full article 

Tuesday, June 11, 2013

Eliminate Embedded commissions ..Professionalize investment advice

Embedded commisions are the source of a lot of problems for retail mutual fund  investors. In this short paper we explain why  Read the full article 

FOOTNOTE:
"Assuming that both approaches cost the investor the same amount, most investors (59%) continue to prefer to pay fees that are part of their mutual funds, while 33% would prefer to pay for advice separately.” Source: Canadian Investors' Perceptions of Mutual Funds and the Mutual Fund Industry 2011 report . The Report notes “The general preference for including advisor compensation in the structure of the mutual fund is constant across all demographic groups and investor types. For example, higher value investors are no more or less likely to support this approach. There are also no significant differences related to investor age or the size of their investment account." [ Better fee disclosure and performance reporting may alter these numbers. ]

Wednesday, June 5, 2013

Research: The Arithmetic of Investment Expenses by William F. Sharpe


Research: The Arithmetic of Investment Expenses by William F. Sharpe

ABSTRACT Recent regulatory changes have brought a renewed focus on the impact of investment expenses on investors’ financial well-being. The author offers methods for calculating relative terminal wealth levels for those investing in funds with different expense ratios. Under plausible conditions, a person saving for retirement who chooses low-cost investments could have a standard of living throughout retirement more than 20% higher than that of a comparable investor in high-cost investments. In other words fees count.High fees plus conflicted advice= Freedom 75. With higher Canadian fund expenses , the impact on retirement savings is much higher.Read the full article

Saturday, March 2, 2013

Trailer commissions: Do they skew advisor recommendations?

This article explains how trailer commissions work in mutual funds.Because they are a sales incentive payment they create a powerful conflict-of-interest for advisors. Read the full article

Saturday, February 9, 2013

Canada US mutual fund fee gap

This is our Submission to the Senate Standing Committee on National Finance studying the issues behind the gap between Canada US pricing of similar products.The Final report was issued in Feb. 2013 but didn't address tgis importamnt issue.None of the submissions were made publicly available so we decided to post ours for readers to see. Read the Submission

Friday, January 4, 2013

A Review of Canadian Mining Stock Scandals


This paper is an attempt to provide information to investors, students, brokers, and professional people who
may come into contact with a scam. By controlling one's emotions it is possible to survive such contact and
come away a more knowledgeable person. The elements that make up mining stock scams appear to be
obvious in hind-sight. The scammers who operate in this business are very clever salesmen who know how
to exploit weaknesses in human nature. The paper will describe the elements that generally make up stock scams and how to be wary of these "red flags". A detailed review of the Bre-X scandal of 1996-97 will also be given to record the elements that made up the "Scam of the Century". Mining has a mystique to it that creates curiosity and intrigue. The image of the old-time prospector and his mule crossing the wilderness in search of gold is today replaced by the slick promoter in a three-piece suit running a Boiler Room with Internet connections and immediate access to information and the ability to tap into the emotions of investors and ordinary citizens. The seeking today is often times not for gold but for pigeons to part with their money. Read the entire Paper 

Thursday, January 3, 2013

Annual Investment Checkup

We all value the Annual medical to check our physical health. Well, it's a very good idea to do an Annual investment Checkup as well. Read the full article