Canadians put more research into vacation planning than mutual fund purchases: poll

Share this article and your comments with peers on social media Mutual fund sales outpace ETF sales in March “Though not surprising, it’s discouraging to see that Canadians are prioritizing vacation planning and car purchases over their mutual fund investment decisions,” says Silvio Stroescu, head of mutual funds at ING Direct. “Mutual funds are the most popular investments in retirement portfolios, so to spend a little more time researching your options is worthwhile and can lead to significant savings in the long term.” Whether Canadians lack interest in researching investments or have no idea where to start, it’s clear they could use some additional research time when it comes to investing. An overwhelming majority (73%) of mutual fund investors say they turn to a banker or financial advisor when looking for advice in choosing mutual funds. Others polled say they turn to family (7%), media (3%) or friends (2%) while only one in 10 say they don’t seek advice from anyone. Some Canadians admit that factors like not having enough time to educate oneself (15%), having too many choices (14%) or feeling like investing requires too many steps (9%) were among the obstacles investors faced when deciding on which fund to choose. The survey also found Canadian investors still don’t know the basic cost of holding their funds. Half of mutual fund investors said they felt a management expense ration (MER) of 1% or less was fair, yet 50% were unsure of the annual management expense they are paying for mutual funds. “The perceived complexity around finding the right mutual funds often means Canadians are leaving their investment choices to other people,” says Stroescu. “Outsourcing investment decisions is the main reason why Canadians pay some of the highest mutual funds fees in the world.” Survey data was gathered through teleVox, Harris/Decima’s national telephone omnibus survey. The data were gathered between Nov. 8 and 12, 2012 for a total of 1,000 completes. The ING Direct poll results came from an online survey conducted on Dec. 14, 2012 among a sample of 1,008 Canadian adults who are Angus Reid Forum panel members. A sample of the same size has a margin of error of 3.08%, 19 times out of 20. Related news CIBC to introduce fixed administration fees for certain investment funds Keywords MERs and management fees,  Mutual funds Facebook LinkedIn Twitter Fiera sells rights to manage US$1.9B emerging markets fund More than half (51%) of Canadians who own mutual funds agree that choosing the right fund is neither simple nor straightforward, yet most spend more time planning luxuries instead of annual investments. A recent survey conducted for online bank ING Direct revealed Canadian mutual fund investors spend, on average, 3.4 hours a year planning their mutual fund investments. By comparison, they spend more time planning a major technology purchase such as a smartphone, television or computer (5 hours), a vacation (6.6 hours) or a car purchase/lease (9.2 hours). IE Staff read more