New Materials Aim to Improve Conversations between Investors and Advisors

TORONTO, Nov. 21, 2016 /CNW/ - The Investment Funds Institute of Canada (IFIC) today released a three-part series of Advisor Insights aimed at helping advisors ensure that investors get the most from the new reports that they will soon receive under a regulatory initiative known as "CRM2".

"Improving investor knowledge is a major objective of CRM2, and one that the industry fully supports," said IFIC's president and CEO Paul C. Bourque, Q.C. "Our new three-part Advisor Insights series will strengthen the quality of advisors' conversations with investors about their investment returns and fees."

Advisor Insights: An Opportunity to Strengthen Your Relationships with Clients, provides some guiding principles to help frame advisors' conversations, such as putting themselves in their clients' shoes, acting as their clients' financial coach and prompting clients to ask questions in order to gauge their understanding so that the advisor will know what new information to provide.

Advisor Insights: Answering Your Clients' Questions about the Performance of their Investments provides clear explanations about the difference between a personal rate of return and a target rate of return. It describes the strengths and weaknesses of benchmarks and explains why the performance numbers in Fund Facts do not match the performance numbers in the investor's CRM2 report.

Advisor Insights: Answering Your Clients' Questions about Services and Fees describes the different services provided by dealers and fund managers and explains why the total cost figure contained in the new report does not match the MER(s) for the fund(s) in which the client has invested. It notes that not all fees are contained in the new cost report.

"CRM2 is about much more than transparency and disclosure," Bourque stated. "We expect it will positively impact the relationships of dealers and advisors with their clients. The industry is committed to helping to strengthen investors' knowledge and build their confidence to ask questions so that they will make better decisions to meet their needs."

Under CRM2, dealers have until July 14, 2017 to deliver two new reports to investors. One report will show, in dollar amounts, the money paid to the dealer on the investor's account during the previous year. The other will show how well the client's investments performed. Most investors will receive their reports early in 2017 (and annually thereafter) because most firms are providing the information on a calendar-year basis.

"Once CRM2 is fully implemented, Canada will be a world leader in providing clear information to investors," Bourque noted.

About IFIC

The Investment Funds Institute of Canada is the voice of Canada's investment funds industry. IFIC brings together 150 organizations, including fund managers, distributors and industry service organizations, to foster a strong, stable investment sector where investors can realize their financial goals. By connecting Canada's savers to Canada's economy, our industry contributes significantly to Canadian economic growth and job creation. The organization is proud to have served Canada's mutual funds industry and its investors for more than 50 years.

SOURCE The Investment Funds Institute of Canada

Sara Clodman, Senior Manager, Public Affairs, [email protected], 416-309-2317