Why investors need your help: CSA survey

Along with highlighting national investor education initiatives from April 2017 to March 2018, the 2018 Annual Activity Report from CSA’s Investor Education Committee (IEC) offers a look at how much investors know and their habits.

The report, published on Tuesday, includes findings from the 2017 CSA Investor Index, which looks at investment knowledge and behaviour, and incidences of investment fraud among Canadians. This is the fourth time the survey has been done since 2006.

That survey found the following:

• About half (51%) failed the general investment knowledge draft test included in the survey;
• Eighteen percent believe they have been approached with a fraudulent investment opportunity, down from 22%;
• Only 9% have an online account with an investment advisor, even though 23% said they are likely to use a robo-advisor if they open a new account or move an existing one;
• Most (72%) with an advisor said they have received an annual statement discussing fees and performance since January 2017, but 63% report not speaking to their advisor after reviewing such reports; and
• Nearly half (43%) use some form of social media for investing information, up from 35% in 2012. Facebook and YouTube are top sources.

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“The IEC’s primary goal is to provide a credible and objective voice to help Canadians make better-informed financial decisions,” said Louis Morisset, chair and president at CSA, in a release.

Over the last year, for example, CSA has sought to educate Canadians about the risks of investing in cryptocurrencies and initial coin offerings (ICOs). Of particular concern are issues such as questionable regulation, volatility, the susceptibility of online wallets and exchanges to theft, and a lack of insurance against loss of cryptocurrencies.

Read: 5% of Ontarians own cryptoassets, most people don’t understand them: OSC

The IEC report also highlights the work of provincial regulators. The BCSC has continued its “Take a Look at Fees” campaign to encourage people to look at the fees they pay for investment advice and products, while the Alberta Securities Commission is focusing on financial literacy “as a means to make more informed investing decisions and avoid fraudulent investment opportunities,” the IEC says.

For its part, OSC relaunched its Get Smarter About Money website and has introduced a senior strategy to help address issues as clients age.

Read the full report here.

Methodology: For the 2017 CSA Investor Index, Innovative Research Group interviewed 7,271 Canadian adults online between August 28 and October 2, 2017.

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