In an article in globeinvestor.com, Dan Richards (Strategic Imperatives) makes the point that after last year’s market debacle, more people are doing their homework on how and where they should be investing their money. The net result is that they are asking tougher questions, requiring financial advisors to spend more time and effort responding with evidence and support for their advice.

That is good news. For too long, investors have been unprepared or not confident enough to play devil’s advocate with their advisor.  While it’s true that most of us have become much more comfortable questioning our doctors, it’s not true that we have been able to question our financial advisors until very recently.

For example, everyone has to receive account statements every three months, unless the client asks for it on a monthly basis. It contains a lot of information – transactions, sales, purchases, transfers, the name and number of securities, the price and total value of the transaction. But, as Dan Richard rightly points out, people don’t want to read a lot of detailed information. Our attention span is short and most information that we receive, we don’t read because it doesn’t provide any value to us.

So one of the vows you might consider making for 2010 is to request an annual or semi-annual chart that describes the value of your portfolio at the beginning and end of the year; the amount deposited into the portfolio and the amount withdrawn, including fees. This will give you a clear idea of what’s happened to your financial portfolio over a six to twelve month period.

If you are really on a roll, you also might want to ask you financial advisor to learn how to speak plainly and in a way that is easily understood, avoiding jargon and industry terms that you are not familiar with. Then, you can enter into a dialogue with your advisor that brings value to both parties.

Suggested Reading

BC Securities Enforcement Roundup – April 2013

BCSC releases its National Report Card on Youth Financial Literacy

BC Securities Enforcement Roundup – October 2013

More Resources

IFRS Part 1: Introduction to IFRS for Investors

Over the next three weeks, we will discuss the changeover to International Financial Reporting Standards (IFRS) in Canada from an investor’s perspective. These posts are a starting point for investors, to increase awareness that some companies are now reporting in IFRS. Our goal is to point out a few things to be aware of, so […]

BC Securities Enforcement Roundup and ICL

In September 2012, the BC Securities Commission issued one notice of hearing and announced a Supreme Court of Canada decision upholding a commission decision.  BCSC staff also added three companies to the Investment Caution List. During September 2012, neither IIROC nor the MFDA released any decisions against registered individuals in BC. Supreme Court of Canada […]