decision to purchase mutual funds. For whatever reasons, such an obvious requirement has been
opposed by industry participants and lobbyists. This makes absolutely no sense if there is to be an
informed investment decision. It is inconceivable that an industry which constantly claims the value of investment advice should not insist that dealer representatives provide a copy of FF's to clients before the purchase decision is made. Providing FF two business days after the investment decision has been made is a nonsense disclosure . Here's what we told regulators http://www.osc.gov.on.ca/documents/en/Securities-Category8-Comments/com_20140411_81-101_kenmar-associates.pdf
It is all well and fine to disclose the MER of a mutual fund but unless the investor can assess the long-term impact on fees, the disclosure has limited value.Similarly ,if performance is provided without comparison to a benchmark , the average retail investor may derive little from the disclosure. Some disclosure documents are so complex and filled with elaborate terms and conditions that it should come as no surprise that retail investors find it difficult to make informed decisions.This is one reason why we have promoted the idea that investment advisors should be proficient and be required to act as fiduciaries.
We will soon be commenting on the fee and performance disclosures required by the Client Relationship Model part 2.Until CRM2 disclosure focussed on the prospectus and continuous disclosure obligations. With CRM2 ,regulators awoke to the fact that dealers had been able to promote a transaction business as an advice business but without the associated disclosures and standards. Once registered as salespersons, stockbrokers and salespersons became dealer representatives and business titles changed to advisor and other misleading tiitles which calmed invesrors. .Hence the sudden need for the disclosure of fees , account performance , conflicts- of -interest and client relationships and an increrased regulatory scrutiny of "advisor " titles and designations.
We have also commented in the past on " Free lunch" seminars, financial pornography , presentations at retirement homes, Fund company webinars , "advsor" use of social media and other " off book" disclosure mechanisms that are loosely covered by securities laws and rules.All of these sorts of sales communications ( i.e. disclosures of information designed to promote sales) can be hazardous to your financial wealth. Take a read about what one abused investor has to say about “un-disclosure ” .http://www.investoradvocates.ca/viewtopic.php?f=1&t=180&p=3786#p3786