Back in 2006, the Canadian Securities Administrators (CSA) commissioned a major piece of research. that looked at Canadian investors’ skills and knowledge and the levels of investment fraud in Canada. It was an illuminating study. We learned a great deal about our investing beliefs and our behaviour. For example, investors understood the importance of being informed investors, yet they fell short when it came to putting their knowledge into practice. The result was a more vulnerable investor to unsuitable or illegitimate investment opportunities.
This summer we conducted another investor index, surveying more than 6,000 Canadians. We found to our dismay that the number of Canadians with no savings at all had increased by 8% (from 28% to 35%). On the good news front, the numbers of Canadians falling victim to investment fraud hadn’t changed.
But here is where BC investors have to be alert. BC is way ahead of the pack (10% higher than the national average) when it comes being approached with an investment scam. Of further concern is the fact that British Columbians are the most likely to say they have an aggressive investment style, with 38% agreeing with this statement. This last point is consistent with our Eron Mortgage Study where we learned that of those scammed, many were overconfident men in their 50’s. In the Eron Mortgage debacle, over 3,000 investors lost more than $180 million.
These are just a few of the findings in what is a very important piece of research. There is a lot to learn about Canadian investors.
New rule changes that aim to give investors better disclosure about scholarship plans came into effect across the country today. Included in the changes is a new document called the Plan Summary, which regulators tailored to meet the needs of investors who have little or no experience purchasing investment products. A scholarship plan is […]
In the past few years, financial literacy has become a hot topic. Designating November as financial literacy month in Canada is another positive step in raising awareness and encouraging dialogue around the subject. In writing some blog posts this month, and reading over our National Report Card on Financial Literacy, I came to the […]