Www.investinknowingmore.ca Investing 101 – Part 2 Working With Financial Professionals.

www.investinknowingmore.ca

Investing 101 – Part 2

Working With Financial Professionals


Who am I and why am I here?• NBSC– Crown corporation– Protect investors and foster capital

markets

• Marissa– BBA (E-com)– 6 years with the NBSC– I’ve made $$ mistakes too


Financial Advisers - Expectations• What DON’T they do?– Predict market performance with certainty– Recommend investments that are always

profitable– Act on vague instructions– Meet unrealistic goals

• What DO they do?– Make clear and specific recommendations – Explain the reasons for the

recommendations – Point out the strengths and weaknesses of

opportunities and recommendations – Outline the risks involved

The term ’financial adviser’ includes: securities dealers; advisers; dealing representatives; advising representatives; or other registrants.


Financial Advisers – How to choose?1. Decide what kind of help you need

• How much advice do I need?• How experienced am I?• How much am I planning to

invest?


Financial Advisers – How to choose 2. Ask around

• Make a short list• Check registration• One size does not fit all!


Financial Advisers – How to choose3. Set up a meeting

• Screen over the phone• Meet in person• Ask questions.


What to ask?

• Are you and your firm registered with the NBSC?

• Registration tells you:– The type of products or services they

are qualified to sell or provide advice on.– That they are properly qualified and

meet a certain standard.


What to ask?

• What products and services do you offer?– Specialized–Wide range

• What level of services can I expect?– How often will we meet? – How will you update me?


What to ask?

• How are you paid for your services?

– Salary (built into the products you buy)– Commission (on products they sell)– Flat fee (hourly rate or % of assets)– Combination


Mutual Fund Fees

• Fees reduce your return– Sales Charges– Transaction fees– Account fees– Fund expenses

• A fund’s fees are described in the Fund Facts or Simplified prospectus disclosure documents


Top 3 Costs - Loads

1. Sales Charges (“Loads”)– charged when you buy or sell units or shares of a fund.

1. Front-end Load / Initial sales charge2. Back-end Load / Deferred sales charge3. Low load / Low sales charge4. No load5. Fee-for-services


Top 3 Costs - MER

• Management Expense Ratio (MER)–Measure of what it costs to operate a

mutual fund (expressed as a % of the fund’s value)

– Average 2.5% but varies depending on type of fund

– The higher the MER, the more the fund will have to earn in order for you to make money


Top 3 Costs – Trailing Commissions• Paid each year to the company that

sold you the fund• Reflected in the MER • Ranges from 0.25% - 1.5% of the

value of your investment each year


Your Responsibilities

• Be prepared• Ask questions and take notes• Be informed• Stay up to date• Keep your adviser up to date


What if I have a problem?

• Step 1: Do I have a complaint?– Not registered– Conducts transactions without your

permission– Switches you from one mutual fund to

another without legitimate reason– Recommends unsuitable products based

on the information you provided


What if I have a problem?• Step 2: Contact the adviser.– Clearly define the issue and outcome

you expect– Gather all relevant documents– Keep notes

• Step 3: Contact the firm.– Follow their complaint process


Learn more!

• www.investinknowingmore.ca• Facebook.com/4NBInvestors• Twitter.com/4NBInvestors

• [email protected]• 1 866 933-2222

Www.investinknowingmore.ca Investing 101 – Part 2 Working With Financial Professionals.

Documents

Transcript of Www.investinknowingmore.ca Investing 101 – Part 2 Working With Financial Professionals.