Investor ALERT : Online brokers may be overcharging you

This ALERT is for investors who buy mutual funds via a discount broker. Discount brokers shouldn’t be collecting opaquely disclosed trailer commissions intended to provide you with investment advice. The obligation to provide investment advice is contained in Fund Facts , the document you were given before you bought the fund .A  report provided by securities regulators tells us that  about $25 Billion  in mutual funds at discount brokers are A series  ( a class of fund with a portion of the cost intended for advice per Fund Facts) which means that  investors are being overcharged  .Since discount brokers cannot and do not provide personalized investment advice, clients of A series funds are being robbed of returns.Clients are not being treated fairly, honestly and in good faith as required by securities laws.

By the way, at 1% trailing commission, that amounts to an astounding $180,000,000 each year that isn't going towards the retirement funds of Canadians! Shameful, no? That 1% is buried inside the MER (Management Expense Ratio) of the fund so it's not readily visible.

So, ask your discount broker what fee you are being charged to buy and own mutual funds. If you are being charged an ongoing trailing commission for personalized advice, you are being charged for a service that is not being  provided. Ideally, the charge would be equivalent to what you’d pay to buy an ETF, around $9.95  . 

Securities regulators have banned all trailer commission payments to discount brokers but the effective date of the ban is June 1, 2022!  Between now and then , your savings are being harvested , Take action now  to eliminate the damage to your life savings.