Upload
buck-white
View
219
Download
1
Embed Size (px)
Citation preview
20th Annual Conference
Canadian Investors’ Perceptions of Mutual Funds and
the Mutual Fund Industry
2
Overview
Confidence in Mutual Funds Meeting Financial Goals
Comfort with Understanding of Mutual Fund Investing
Method of Purchasing Mutual Funds and Information Sources Consulted
The Advisor Relationship, Fees & Suitability
Point of Sale Information
The Mutual Fund Investment Decision
Staying Informed
Dealing with Problems
3
Methodology
Actual Interviews
#
Weighted Interviews
#
Marginof Error
%
Atlantic Canada 301 60 ±5.6%
Quebec 302 228 ±5.6%
Ontario 458 528 ±4.6%
Manitoba/Saskatchewan
202 84 ±6.9%
Alberta 302 144 ±5.6%
British Columbia 300 156 ±5.7%
TOTAL 1865 1200 ±2.2%
4
Confidence in Mutual Funds Meeting Financial Goals
5
Confidence in Investment Products Meeting Financial Goals
Q4-8: Using a 10 point scale, where 1 means ‘not at all confident’ and 10 means ‘completely confident’; overall, how confident are you that each of the following investment products would help you meet your household’s financial goals? How about: (RANDOMIZE AND READ) (June 2006, n=1865)
3% 22% 29% 27% 12% 8%
6% 26% 31% 21% 8% 7%
7% 32% 32% 17% 6%5%
6% 48% 31% 10%2%2%
19% 51% 18% 7%3%4%
0% 20% 40% 60% 80% 100%
Very confident(10)
Confident(7-9)
Somewhatconfident(5-6)
Not veryconfident(2-4)
Not at allconfident(1)
Don't know/Refused
Real estate investments, incl. your primary residence
Mutual funds
GICs and other term deposits
Bonds, incl. Canada Savings Bonds
Stocks
Mean
7.4
6.5
5.9
5.5
4.8
TotalConfident
88%
85%
71%
63%
54%
6
Comfort With Understanding of Mutual Fund Investing
7
Investors’ Comfort with Their Understanding of the Mutual Funds They Own
Q2B: And using a scale from 1 to 10 where 1 means you are ‘not at all comfortable’ and 10 means you are ‘very comfortable’, how comfortable are you with your understanding of the mutual funds you own? (RECORD ONE ONLY) (June 2006, n=1865)
DK/Ref.1%
Somewhat Comfortable
(5-6) 30%
Comfortable (7-9) 45%
Not At All Comfortable
(1) 3%
Very Comfortable
(10) 8%Not Very Comfortable
(2-4) 13%
Total Comfortable: 83%Mean: 6.4
8
Methods of Purchasing Mutual Funds and Information
Sources Consulted
9
Methods of Purchasing Mutual Funds
Q18: For the next few questions I would like you think about the last time you invested in a mutual fund. When buying those mutual funds did you: (READ AND RECORD ONE ONLY) (June 2006, n=1865)
Purchase Them From Someone Who Provided You With Advice
And Guidance
Purchase Them Online Or From An Individual Who Just Took
Your Mutual Fund Order
Don’t Know
Refused
10
Sources Consulted When Last Purchased Mutual Funds
Q23-26:Still thinking back to the last time you invested in a mutual fund, did you consult the following sources: (RANDOMIZE AND READ. RECORD YES/NO FOR EACH) (June 2006)
21% 77% 1%
32% 66% 1%
60% 38% 2%
94% 5%1%
0% 20% 40% 60% 80% 100%
NoYes Don't know/Ref.
Your advisor, meaning the person you purchased the mutual fund from
(n=1596)
Printed information from the mutual fund company
(n=1865)
Your friends, family and colleagues(n=1865)
The mutual fund company’s website(n=1865)
11
The Advisor Relationship,Fees & Suitability
12
Satisfaction with Advice ProvidedBy Advisor
1%
25%
60%
2%
10%
0%
20%
40%
60%
80%
CompletelySatisfied (10)
Satisfied (7-9)
SomewhatSatisfied (5-6)
Not VerySatisfied (2-4)
Not At AllSatisfied (1)
Q45: I would now like to ask you about your relationship with your financial advisor - meaning the advisor who you buy your mutual funds from. Using a scale from 1 to 10 where 1 means ‘not at all satisfied’ and 10 means ‘completely satisfied’, how satisfied are you with the advice provided by your financial advisor? (RECORD ONE ONLY) (June 2006, n=1596)
Mean: 8.0
13
Q47-48 Has your advisor ever: (RANDOMIZE AND READ. RECORD YES/NO FOR EACH)(June 2006, n=1596)
94% 5%1%
94% 5%1%
0% 20% 40% 60% 80% 100%
NoYes Don't know/Ref.
Had a discussion with you about the amount of investment risk
you are comfortable with
Had a discussion with you about your overall investment objectives
and goals
Whether Advisor Has Ever Discussed Investment Objectives and
Risk Tolerance
14
Q46 & 49: Has your advisor ever: (RANDOMIZE AND READ. RECORD YES/NO FOR EACH)(June 2006, n=1596)
55% 42% 3%
77% 20% 4%
0% 20% 40% 60% 80% 100%
NoYes Don't know/Ref.
Asked you to complete a questionnaire to identify your risk
tolerance and overall financial objectives
Had a discussion with you about how he/she is compensated
Whether Advisor Has Ever Administered Questionnaire and Discussed
Compensation
15
Comfort with Fees & Understandingof Fees
Q50-51: Overall, using a scale from 1 to 10 where 1 is ‘not at all comfortable’ and 10 is ‘very comfortable’ how comfortable are you with: (RECORD ONE ONLY FOR EACH) (June 2006, n=1586)
12% 44% 26% 10%4% 4%
13% 44% 27% 9%3%4%
0% 20% 40% 60% 80% 100%
Very comfortable(10)
Comfortable(7-9)
Somewhat comfortable(5-6)
Not very comfortable(2-4)
Not at all comfortable(1)
Don't know/Refused
Any fees that you pay for your mutual funds
Your understanding of any fees that you pay for your
mutual funds
Mean
6.8
6.7
TotalComfortable
84%
82%
16
Point of Sale Information
17
Comfort with Information to Make Informed Investing Decision
Not Too Comfortable
4%
Somewhat Comfortable
45%
DK/Ref.2%
Very Comfortable
46%
Not At All Comfortable
2%
Q19: Still thinking back to the last time you invested in a mutual fund, prior to making this last investment, did you feel very comfortable, somewhat comfortable, not too comfortable or not at all comfortable that you had the right information to make an informed decision? (RECORD ONE ONLY) (June 2006, n=1865)
Total Comfortable: 91%
18
Information Considered When Last Purchased Mutual Funds
Q27,Q28, Q30, Q32, Q37: Still thinking back to the last time you invested in a mutual fund, and using a 10 point scale where 1 means you “did not consider it at all” and 10 means you “considered it in depth”, to what extent did you consider each of the following pieces of information? How about: (RANDOMIZE AND READ. RECORD ONE FOR EACH) (June 2006, n=1865 - *n=1596)
6% 21% 23% 14% 25% 11%
7% 23% 22% 23% 20% 5%
8% 25% 27% 16% 18% 6%
8% 31% 26% 15% 16% 4%
9% 32% 24% 14% 16% 4%
10% 41% 26% 9% 10%5%
12% 40% 25% 11% 10%3%
17% 44% 21% 7% 8%4%
19% 47% 20% 6%5%2%
20% 58% 16% 2%3%2%
0% 20% 40% 60% 80% 100%
Did not consider at all (1)
Did not reallyconsider (2-4)
Considereda bit (5-6)
Consideredin depth (10)
Consideredsomewhat (7-9)
Don't know/Refused
Your advisor’s opinion
The risks associated withinvesting in the fund
The fund’s past performance comparedto other funds in its category
Information about the companyoffering the fund
The companies, holdings orsectors the fund invests in
The price per share
Information about the mutual fundcompany’s portfolio manager
The fee the mutual fund companyreceives for managing the fund
Fees your advisor receives for you investment in the fund
The fund’s rating from a service likeMorningstar or Globe Fund
Mean
7.7
7.1
6.9
6.3
6.3
5.5
5.5
5.2
4.7
4.6
TotalConsidered
94%
86%
82%
77%
77%
65%
65%
60%
52%
50%
19
Whether Advisor Discussed Fees/Compensation When Last Purchased
Mutual Funds
Q21-22: (ASK IF PURCHASED MUTUAL FUNDS FROM SOMEONE WHO PROVIDED ADVICE/GUIDANCE AT Q18) And still thinking back to the last time you invested in a mutual fund did the person you purchased it from discuss the following issues with you? How about: (RANDOMIZE AND READ LIST) (June 2006, n=1596)
53% 42% 5%
69% 25% 6%
0% 20% 40% 60% 80% 100%
NoYes Don't know/Ref.
Whether or not you will be charged a sales commission when you buy or sell the mutual fund - also called “front-end
load” and “back-end load” fees
How the person you bought them from would be compensated for your purchase
of that fund
20
Whether Advisor Discussed Suitability When Last Purchased Mutual Funds
Q20: (ASK IF PURCHASED MUTUAL FUNDS FROM SOMEONE WHO PROVIDED ADVICE/GUIDANCE AT Q18) And still thinking back to the last time you invested in a mutual fund did the person you purchased it from discuss the following issues with you? How about: How well suited that mutual fund is for reaching your investment objectives (RANDOMIZE AND READ LIST) (June 2006, n=1596)
No7%
Yes90%
Don't Know2%
21
The Mutual Fund Investment Decision
22
Importance of Issues in Decision to Invest in Mutual Funds
Q10-16 Are each of the following issues very important, somewhat important, not too important, or not at all important in your decision of whether or not to invest in mutual funds? How about: (RANDOMIZE AND READ LIST) (June 2006, n=1865)
38% 38% 12% 6%6%
38% 43% 11% 7%1%
40% 41% 11% 5%2%
43% 43% 8%4%2%
43% 46% 6%3%2%
56% 33% 7%3%1%
0% 20% 40% 60% 80% 100%
Very important
SomewhatImportant
Not at allimportant
Don't know/Refused
The management of mutual funds by professional investors
That mutual funds are an effectiveway to diversify and manage risk
The easy access mutual funds provide to a wide range
of investments
The ease of moving investmentswithin a family of mutual funds
The ability to buy mutual fundswith small amounts of money
The amount of regulation inthe mutual fund industry
Not tooimportant
TotalImportant
89%
89%
86%
81%
81%
76%
23
Staying Informed
24
Methods Used to Stay Informed About Mutual Fund Investments
Q40-42: There are different ways to stay informed about your mutual fund investments. Overall, do you always, sometimes, rarely or never read any of the following information? If you didn’t receive this information, please let me know. (DO NOT RANDOMIZE AND READ) (June 2006, n=1865)
37% 37% 23% 1%1%
43% 31% 24% 3%1%
80% 15% 5%1%
0% 20% 40% 60% 80% 100%
Your account statement which you receive monthly or quarterly, and that shows the
current value of your personal mutual fund holdings
The annual reports sent out by the mutual fund company. These are descriptive
reports prepared by the mutual fund that you receive once or twice a year,
separately from your account statement
The prospectus sent out by the mutual fund company - this is a written document prepared by the mutual fund company that you receive either at the time of purchase
or shortly after purchasing a mutual fund
Yes, Always
Yes, Sometimes
Yes,Rarely/Never
Did not receivethat info
Don’t Know/Refused
25
Amount of Information Received About Mutual Funds They Invest In
Q3: Overall, do you feel that you receive (ROTATE TOO MUCH AND NOT ENOUGH) too much, not enough or the right amount of information about the mutual funds you invest in? (RECORD ONE ONLY) (June 2006, n=1865)
Right Amount
77%
Too Much 7%DK/Ref.
1%Not Enough
15%
26
Whether Information Received from Mutual Fund Companies Answers Questions
DK/Ref.4%
Some 20%
Most 51%
None 2% All
17%A Few
6%
Q43: Overall do you feel the information you receive from mutual fund companies answers all, most, some, a few or none of your questions about your mutual fund investments? (RECORD ONE ONLY) (June 2006, n=1865)
27
Preferred Format For Annual Report
DK/Ref.2%
Detailed Annual Report
12%
Both5%
Two Page Summary Document
80%
Q44: Mutual fund companies send out annual report documents to their investors at the same time each year. These reports outline issues such as the fund’s investment objectives and summarize the investments the fund has made over the year. Would you prefer to receive a (RANDOMIZE DETAILED AND 2 PAGE SUMMARY) detailed annual report that tends to be about 50 or more pages or a two page summary annual report? (RECORD ONE ONLY) (June 2006, n=1865)
28
Dealing with Problems
29
Experienced Problems with Investments
Q52: Have you ever experienced any problems with your investments, other than normal market fluctuations? (RECORD ONE ONLY) (June 2006, n=1865)
No90%
Refused1%
Don’t Know
1%
Yes8%
30
First Step Taken to Resolve Problems with Investments
Speak To Advisor’s Superiors
Contact The Mutual Fund Company
Contact Advisor/Banker/Financial Planner - Insisted
Move Investments To Another Advisor
Sell/Take Money Out/Cancel/Close Account
Take Action/Research/Review/Do It Myself
Other
Nothing
Don’t Know/Refused
Q53: If you were to experience a problem with your investments in the future, what would be the first thing you would do to resolve the issue? (IF RESPONSE IS CONTACT ADVISOR/BANKER/FINANCIAL PLANNER DO NOT ALLOW RESPONSE – PROMPT “What would you do next” )(June 2006, n=1865)
31
Next Step Taken to Resolve Problems with Investments
Move Investments To Another Advisor
Contact The Mutual Fund Company
Speak To Advisor’s Superiors
Sell/Take Money Out/Cancel/Close Account
Contact A Regulatory Body (General)
Contact Lawyer/Police/Take Legal Actions
Other
Nothing
Don’t Know/Refused
Q54: And if it wasn’t resolved after that, what other steps would you take to resolve the issue? PROBE: And what would you do next? (DO NOT READ OR PROBE WITH LIST. RECORD ALL THAT APPLY) (June 2006, n=1865)
20th Annual Conference
Canadian Investors’ Perceptions of Mutual Funds and
the Mutual Fund Industry