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Wealth Professional | 26 Oct 2015, 08:15 AM Agree 0
The CSA’s report is an ‘I-told-you-so’ for fee based advisors, while embedded compensation advisors are on the defensive
  • Debbie | 26 Oct 2015, 05:32 PM Agree 0
    Nonsense Mr Pollock! Canadians are not satisfied with the current commission system they are deluded and deceived by the existing scheme!
    The only reason they seemingly prefer it is because they do not understand it and the industry has given the illusion for years that it is free. It is hidden, misunderstood and not plain. If they had to say would you prefer to pay me "X" amount per hour or have the fund company pay me from out of YOUR funds "Y" amount and then state the exact dollar commission amount for that advice plus the trailing commission over the course of that year and beyond, consumers would be singing a whole new song and dance. It would not take long to realize that X amount per hour is likely far, far less than a % commission and trailing fees (usually for next to no service beyond the the original "sale" ) It appears "The lady doth protest too much, methinks." These pious arguments from Advocis have lost credibility. The facts in these reports indicate the both the gig and the jig is up!
    Read Andrew Teasdale blog http://blog.moneymanagedproperly.com/?p=4783
  • Larry Elford | 27 Oct 2015, 08:01 AM Agree 0
    ADVOCIS sounds more and more like HOCUS POCUS. To have changed their group name to a cross between "advice" and "advocate", and then to lobby continuously to be able to NOT be required to offer advice or products which would be demonstrably in the best interests of those they advise……is disingenuous at best and a hazard to the financial health of investors.
  • Jim Zoellner | 31 Oct 2015, 08:36 PM Agree 0
    Debbie I do not think that ALL Canadians are dissatified with the current commission system. You are assuming all but you really do not know if ALL are dissatisfied Some maybe especially the media who has been raving on about them for well to long. But not all----some.
    Let us not take the right to paint all advisors with the same brush. When you make statements you should be sure you have the fact all the facts and the real facts. Read the first sentence.
    On the other hand I will agree with some of what you say especially about no service after the first sale. There are two kinds of advisor or so called advisor one we call asset collectors---they are only interested in accumulating assets for the commissions and then there are those that have the right to be called advisors. Those that do the proper fact finding and then structure portfolios that match the clients needs and profile and follow up regularly. One of those is writing this note at this moment and I do not appreciate you painting all advisors with the same brush. You are out and out wrong.
    Yes the industry needs to do something about some of your concerns and in my judgement only the financial institutions are in a postion to do that but then do they the motivation to do so? you know what I mean.
    Yes you can tell me to charge a fee but if you knew anything about human nature you would know that humans prefer to know but keep it hidden. Read Thinking Fast and SLow.
    I have been in this business for 27 years and I have some very impressive credentials, have researched extensively and know what I am doing and talking about. I advise clients and do not collect assets for commission. Canadians need a lot of assistance in accumulating wealth most do not understand finance and are afraid to.
    Go to some large companies that offer employees a Definded Contribution Plan and learn what assistance they get in investing but never or seldom any advise on investing but yet the provider continues to receive fees or commission as long as the assets are on the books and may never offer one piece of advise. Employees keep paying fees that include commisons but no one is saying anything about the commercial side. Wonder why? Please Debbie spend some time to understand our industry that serves the individual investor and then comment when you have some real facts.
  • Jim Zoellner | 31 Oct 2015, 08:49 PM Agree 0
    Oh by the way Debbie I have about 700 clients all are Canadians, none are dissatified with the fee structure therefore it is not possible that ALL Canadians are dissatisfied.
  • Debbie | 02 Nov 2015, 12:44 PM Agree 0
    I took exception to Mr. Pollock's bold, condescending and unsubstantiated remark: “Our anecdotal evidence tells us that Canadians are generally satisfied with the current commission system for mutual funds." How was his anecdotal evidence gathered? How skewed and biased might his evidence may be? I personally don't like all Canadians being painted with the same brush.

    Perhaps at one time Canadians thought that women should not have the vote, that we should not have our own flag, our own right to self determination. Perhaps at one time we all believed in slavery, or that indeed everyone in asymmetric relationships were “happy in their place”. What we do have is an unrestrained imposition of self interest by the financial services industry: “be happy, this is your place!”.

    You state:"then there are those that have the right to be called advisors. Those that do the proper fact finding and then structure portfolios that match the clients needs and profile and follow up regularly". In reality no one has a right to be an "advisor" because the term "advisor" is not recognised by Canada’s securities’ regulation.

    You state: "Yes you can tell me to charge a fee but if you knew anything about human nature you would know that humans prefer to know but keep it hidden".

    An adviser should keep nothing material to the decision hidden, but “advisors” do and the industry has encouraged this. I believe, most thinking folks prefer to know how much they are paying and exactly what they are getting for their hard earned dollars.

    You state: "I have been in this business for 27 years and I have some very impressive credentials,".

    Then why do you not become an adviser and abide by standards that put the client first?

    Jim if you have 700 clients that you may be collecting a trailer fee from and have been in the business 27 years and do not have a single one that is dissatisfied with the fee structure, I can certainly understand your fierce defence of the status quo.
  • Jim Zoellner | 03 Nov 2015, 10:55 AM Agree 0
    Deebie thanks for your valuable comments. I am not defending the commission system, I don't know how to explain it but I know that it is not fair to all clients, god knows that I have seen itt all over the place. I tell my clients how I get paid they know I keep nothing hidden from them, they trust me. The problem is, I think and would appreciate your comments, that so called advisor are pressured to sell by the institution they are attached to, and they need to feed the family that the commissions come before clients. Financial institution are in my judgemeent on of the big issues because if you do not sell no matter what you are not going to be around long. Non of us can afford to work for nothing. I believe the financial institutions need to get involved in this but so far they on mum on the issue and they may have a lot to loose. I do not know what the answer is but the current system is not good for clients that I know knowing what I know.
    Thanks for your comments.
  • Ken | 03 Nov 2015, 05:04 PM Agree 0
    Jim hit the nail on the head. This issue starts right from the top.Advisors are the scapegoats for financial incentives and disincentives that drive sales independent of the best interests of clients.Management is the problem and if they won't change, politicians and regulators will have to step in. The financial well being of millions of Canadians is at stake.Will any dealer step up to the plate for the retail investor?Note too yup that CRM will do nothing to alleviate the misalignment between investors and investment dealers ( now using the misleading moniker Weakth manager)It's time....
  • Debbie | 04 Nov 2015, 12:04 PM Agree 0

    Yes Jim, you are right, the current system is not good for clients. We need leadership on this issue. I agree that advisors are not in a position, on their own, to make this change and that there are considerable pressures placed on them to sell. You are also correct Jim that the big financial institutions are part of the problem and are going to resist any change because the present system has been quite profitable for them. That is why we need leadership from our regulators, those associations that are interested in clients’ best interests and we need political involvement. No one expects anyone to work for nothing. Good advisors I am sure are capable of working well within a commission free environment and I am also sure that they can help pave the way for change. Thanks for sharing so openly Jim.
    Ken's remarks also hit the nail on the head.
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