# Wealth Management Companies



## agent99 (Sep 11, 2013)

Anyone here us a Wealth Management Company? 

Here I am talking about a company that takes and does your investing for you. Either completely or in part. 

I would be interested to know how they charge for their services and learn about their performance.

I came across this site that will put you in touch with such companies. https://www.wealthmanagementcanada.com/wealth-management-companies/

I believe some big bank brokerages may do same. For example BMO Harris Bank. https://wealth.bmoharris.com/

Although I enjoy doing this for myself, I think it may now be time to at least learn about alternatives.


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## like_to_retire (Oct 9, 2016)

agent99 said:


> Although I enjoy doing this for myself, I think it may now be time to at least learn about alternatives.


Is this because you feel you may not be capable in the future?

I wonder if it wouldn't be easy to slowly reduce investments down to simple, all purpose ETF's and arrange to have a certain cash amount timely moved to a chequing account, and have your bill paid automatically?

I've never done anything but DIY. I just couldn't stand funding someone else's retirement.

ltr


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## AltaRed (Jun 8, 2009)

There are tons of wealth management companies, who will manage one's AUM, but many of them insist on the capital be in 'their' funds. Both Steadyhand and Mawer are examples of low(er) cost independents than the big names, but even then, there will likely be some additional fee beyond their fund fees to disburse funds to pay bills, etc. That would mean crystallizing capital gains in taxable accounts to convert to 'their' funds.

I talked to Wealthsimple a few years ago on this matter, and while they would provide this service, as low as 0.35% or so for a 7 digit account, they would prefer the capital be invested in one of their portfolios. That said, for a significant account with large unrealized cap gains, they said they would leave that alone and manage the holdings as received. Complexity would add to the problem if a portfolio was not already all ETFs as an example.

None of the above pre-supposes these firms having any POA authority, but they would need trading authority at least.

The key is to start to have individual discussions with select companies. Both my ex and I have very significant unrealized cap gains in our taxable accounts. She is better positioned simply because all of her holdings are ETFs. I am different in that my Cdn equity portfolio is individual stocks and my RRSP (RRIF) iis a 5 year bond/debenture/GIC ladder. At the moment, I believe our POAs (sons) could take over at least my ex's portfolio since it requires little oversight beyond ACB maintenance. Not sure they would want to mess with the oversight required on my stock portfolio as they have busy banking careers, their own portfolios, spouses, etc. to take up 110% of their time.

Added: LTR, you will likely have to face this some day unless you die spontaneously and unexpectedly before your best before date. Your choice of POA might be able to do that for you, but don't be surprised if s/he farms that out to a % of AUM advisor anyway. Having an IPS in place would be helpful. I've done one for me and helped my ex develop one for her.


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## agent99 (Sep 11, 2013)

like_to_retire said:


> Is this because you feel you may not be capable in the future?


Yes - Already 80+ and experiencing unexpected health issues.



like_to_retire said:


> I wonder if it wouldn't be easy to slowly reduce investments down to simple, all purpose ETF's and arrange to have a certain cash amount timely moved to a chequing account, and have your bill paid automatically?
> 
> ltr


Two unreg accounts, each with about a dozen holdings. Mix of stocks, split pfds mainly. Stocks have high CGs. These produce cash flow, transferred as needed to bank accounts that also collect CPP/OAS. 

If we switched to all ETFs we would incur significant CG taxes. I have added one ETF using cash from a tax loss sale. Any cash from RRIF withdrawal will also go there. 

RRIFs and TFSAs have a lot more holdings. Bonds, GICs, Convertibles, ADRs, Preferreds etc. I should start to simplify here. Large part though is 
30+ GICs/bonds in ladder. That will take years to mature, so no immediate action can be taken.

Quite a complex mix that my immediate family are not qualified to manage. Hoping someone else can - Preferably use existing securities and simplify over time. 

Hopefully explains my question. I will be contacting wealth managers. Just asking if anyone else has.


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## like_to_retire (Oct 9, 2016)

agent99 said:


> Quite a complex mix that my immediate family are not qualified to manage.


Yeah, and I'm not being flippant here agent99. I just feel for myself, I've put such an effort in for so many years (as you obviously have), I would hate to get to the finish line and then hand it over to the vultures. My plan involves simplifying more and more as I age. Hell, the biggest GIC ladders in the world are back to zero in five years.

ltr


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## humble_pie (Jun 7, 2009)

like_to_retire said:


> Hell, the biggest GIC ladders in the world are back to zero in five years.


the ladders may be gone but the $$ are still there, no?
at least i would hope


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## like_to_retire (Oct 9, 2016)

humble_pie said:


> the ladders may be gone but the $$ are still there, no?
> at least i would hope


Well yeah, but my comment was in response to agent99's concern about large ladders. Fine, a ladder can be directed into a bond fund or balanced fund completely in five years.

ltr


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## Money172375 (Jun 29, 2018)

From what I recall, TD has Private Investment Advice and Private Investment Counsel. PIA is more of a “let’s do it together approach”. They need your permission to switch funds, stocks, etc. Mostly fee based from what I recall. PIC is a discretionary account. “You do it all”. They can alter the portfolio anytime without notifying you subject to the parameters that were agreed upon (assets allocation, industry etc). Fees at PIC started at 1.3% for a million dollar account and got cheaper the more you invested. PICs model portfolios consistently beat their benchmarks. Fees are an eligible write off with CRA. I’m sure fees at both PIC and PIA have come down with the popularity of ETFs. Client Retention at both was close to 100% . If you can get past the fees......and for some people who are too busy or not inclined, they are excellent choices and I think you would find the personal level of service very high. Ps. Minimum account sizes are somewhat flexible but probably around $1 million. They probably wouldn’t hesitate taking on smaller accounts if they know the potential is there....ie, young professionals, lawyers, doctors etc..


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## AltaRed (Jun 8, 2009)

LTR, it is likely to happen at some point. The alternative is a quick, perhaps pre-mature, death. 

Agent99 is prudent in developing alternative plans, and these plans have more urgency as one crosses 70 and necessary by age 80. That is the last decade for most of us.

Added: I am more likely not to pick the big firms that charge as much as 1.3%. There is no reason why one should pay more than 1% at $1M. That is $10k/year.


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## like_to_retire (Oct 9, 2016)

AltaRed said:


> I am more likely not to pick the big firms that charge as much as 1.3%.


Let's see. On a modest $3M portfolio, that would be $39,000 a year in basic fees to do something that takes me but a few minutes a week.

Heck, it doesn't cost me $39,000 a year to live.

Man, I can make a lot of addle-minded mistakes for $39,000 a year.

Those vultures are just wringing their hands to take all your money away that you spent a lifetime collecting. Fill your boots.

ltr


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## AltaRed (Jun 8, 2009)

It wouldn't be 1% at $3M, but you are sounding penny wise and pound foolish. If you became incompetent, you have no idea how fast you could destroy a nest egg. You must not know incompetent people (friends or family) in your inner circle. If you did, you'd recognize they can quickly become out of touch with rational thought and decision making.


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## humble_pie (Jun 7, 2009)

agent99 said:


> I came across this site that will put you in touch with such companies. https://www.wealthmanagementcanada.com/wealth-management-companies/




imho this does not seem to be the right association. This is a private for-profit company whose revenues appear to come from introducing a perplexed investor to a curated list of investment advisors whom the private for-profit believes would appropriately match to the investor's profile.

as such, this group would be partisan. They would likely recommend only the investment advisors who have signed up with themselves. Possibly only advisors who have agreed to pay referral fees to themselves.

if this would be the case, one has to wonder why referral fees are not mentioned on their website. In addition, one observes that they list only a paltry five investment management firms on their website. Five candidates do not constitute an adequate inventory, not even remotely; so one hopes for their sake that they have more managers lined up in their fold whose names are not listed publicly.


for unbiased, objective referrals, the go-to association would be the professional association to which all or nearly all top-ranked investment advisors in canada belong. It's the Portfolio Managers' Association of Canada.

https://pmac.org/


among PMAC's criteria for membership is the requirement that all their members must be licensed to manage portfolios on a discretionary basis, ie their IIROC established title is "Portfolio Manager." This is the highest ethical standard. Almost without exception, all of their member firms have at least one CFA in their management ranks, sometimes several.

the PMAC used to provide a full list of all of its members on its website. I notice that nowadays they commence with a simple filter in order to offer appropriate curated lists to parties searching for top-ranked investment managers. 

(by top-ranked i do not mean top-performing)
(i mean simply the highest-ranked IIROC license, that of Portfolio Manager)
(it's this commitment to ethical conduct which allows PMs to run discretionary portfolios, ie they can buy, sell, change & refresh portfolios without consulting the beneficial owners first)


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## Money172375 (Jun 29, 2018)

I would suspect the fee would be a lot lower than 1.3% on a $3 million account. .7%? .5%? I don’t know. The point being is that it’s a good service and for clients who are too busy or not inclined, it is a worthwhile option to consider. With the discretionary money managers (in any form), you’re likely getting access to multiple CFA holders, and are in effect getting handed a portfolio manager for your little “mutual fund”. 
It’s not for everyone.......

It’s just like my friends who ask me for advice on investments.....I try to explain that it depends on your goals, risk tolerance and time frame. What investment which appears good for half the country, may not be good for you. It’s the same with the account options we have....whether it be self directed, discretionary, or a blend. For seniors who are considering leaving an investment portfolio to the younger heirs, I would highly recommend seeking a professional......I’ve seen too many inheritances blown on poor management, dot coms etc. The “average” Canadian.....I would suggest easily 75%, needs professional advice. Going out and finding it at a reasonable price would serve most Canadians well. If you’re 35 years old, would you rather put your rsp contribution in a GIC, or would you rather take some branch advice and get into a 2% mer mutual fund. This is the choice most Canadians are faced with and I would argue that they are better off in the mutual fund, in spite of the “atrocious” fee. Their needs and list of what’s important (simplicity, cost, sophistication etc) will change over time. I recognize most here are self directed and fee sensitive but the mass market is not where most on this forum are. It takes time, patience and above all else, the desire to learn more about investing. 

We were never incentivized to refer retail branch clients to one option or the other...discretionary, self directed or blended. The goal was to educate the customer, learn about their goals and knowledge base and get them in the best possible option. For some, that’s a single fund solution, for others it’s a wrap, for others it’s self directed, for others it’s discretionary. People hate the banks, but find a good banker or advisor (if you need either) and you’ll be surprised at what they can deliver. Put mortgage brokers in that category too. 

The charts showing net inflows at market peaks and net outflows at market drops are amazing. And most of that occurs in the self directed accounts. An honest professional helps you through the periods of emotion and chasing the marijuana tip your neighbour gave you.


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## agent99 (Sep 11, 2013)

like_to_retire said:


> Well yeah, but my comment was in response to agent99's concern about large ladders. Fine, a ladder can be directed into a bond fund or balanced fund completely in five years.
> 
> ltr


5 years could be considered a short time... Or it could be too long a time. It depends on age an health.

This at least would not require much 'management'. Just deciding on what to do with the funds. But then someone has to be making those decisions. And who that is, is what the question was about.


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## like_to_retire (Oct 9, 2016)

AltaRed said:


> ......you are sounding penny wise and pound foolish. If you became incompetent, you have no idea how fast you could destroy a nest egg.


Oh well, I guess I'm the only do-it-yourselfer left on the site.

ltr


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## Mechanic (Oct 29, 2013)

like_to_retire said:


> Oh well, I guess I'm the only do-it-yourselfer left on the site.
> 
> ltr


There are at least two of us.


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## AltaRed (Jun 8, 2009)

like_to_retire said:


> Oh well, I guess I'm the only do-it-yourselfer left on the site.
> 
> ltr


No You know I am a fervent DIYer and fired financial advisors decades ago, but I also know I need to have alternative plans for when I become incompetent, or worse, not recognizing when I become incompetent. The first thing, LTR, is to accept that the train WILL come through the tunnel someday. Best to be prepared to jump off the tracks in time.


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## BC Eddie (Feb 2, 2014)

agent99 said:


> Anyone here us a Wealth Management Company?
> 
> Here I am talking about a company that takes and does your investing for you. Either completely or in part.
> 
> ...



Well to actually answer your original question - I have been with these guys since 2006 after I realized managing my own money was not what I was cut out for.

http://www.mmainvestments.com/

I have been very happy with the results. They have a conservative investment philosophy - Coming through 2008 I was only down 8% - So theydon't match the highs but they also don't match the lows. My 13 year XIRR is over 5% and that is including all fees.


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## humble_pie (Jun 7, 2009)

like_to_retire said:


> Let's see. On a modest $3M portfolio, that would be $39,000 a year in basic fees to do something that takes me but a few minutes a week.
> 
> Heck, it doesn't cost me $39,000 a year to live.
> 
> ...



it's true, 1% on several million $$ means big sticker shock.

one trend i'm picking up is that even the portfolio managers who don't sell fixed portfolios are no longer interested in working with the majority of individual stocks.

one can hand over a portf of individual common & preferred, bonds, a few ETFs, some options & they will seek to liquidate most. What they will then substitute will be the house program pooled funds.

the speed & proportion of the liquidation appears to depend upon the size of an individual client portf at the firm.

i'm just speaking in a general sort of way. Investors such as like_to_retire are indeed an endangered species these days


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## fireseeker (Jul 24, 2017)

agent99 said:


> Yes - Already 80+ and experiencing unexpected health issues.
> Two unreg accounts, each with about a dozen holdings. Mix of stocks, split pfds mainly. Stocks have high CGs.


At 80, I intend to start intentionally triggering capital gains (assuming I am alive, and fortunate enough to have CGs).
The reason is prudent tax and estate planning.

If one carries cap gains till death, your estate will be diminished significantly. OTOH, selling one stock a year, say, and paying the cap gain on it could mean you (and your estate) wind up paying less in taxes overall.

Of course, this depends on your annual income and your estate wishes.


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## like_to_retire (Oct 9, 2016)

fireseeker said:


> At 80, I intend to start intentionally triggering capital gains (assuming I am alive, and fortunate enough to have CGs).
> The reason is prudent tax and estate planning.


Sure, and I don't see why someone couldn't slowly make the portfolio simpler and simpler. It could be reduced to something as basic as VBAL.

Wouldn't that be better than handing over tens of thousands of dollars year after year?

ltr


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## AltaRed (Jun 8, 2009)

Indeed, it certainly could be which makes it much easier to manage. Still have to pick someone to do that. Perhaps one's POA could manage that DIY portfolio.

It does mean crystallizing all those unrealized cap gains over time to get there.

There are numerous ways to get to where one needs to be. What is needed is a plan to get there and actual implementation. Fireseeker has a plan.

I have an IPS that provides the outline of plan options. Up to my POA to finish implementation if I don't get there first.


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## ian (Jun 18, 2016)

We have been with Philips Hagar and North wealth management for the past eight years. Overall very pleased with the results. They were acquired by RBC a few years ago. I am not longer interested in doing it nor do I feel that I have the skills.


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## agent99 (Sep 11, 2013)

I owned their funds before they were bought by rbc. Might be worth a look. We do have an rbc account, but most of our stuff is with bmo. I am sure bmo Harrrisbank also offer something similar.

LTR I felt same about handing over 1% of portfolio value back when I retired. Still do, but I need a succession plan not DIY plan.


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## Gator13 (Jan 5, 2020)

An interesting topic. A succession plan is also a good idea for scenarios where one spouse manages the investments and the other does not have the skill set and/or interest to take it over if required.


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## AltaRed (Jun 8, 2009)

Gator13 said:


> An interesting topic. A succession plan is also a good idea for scenarios where one spouse manages the investments and the other does not have the skill set and/or interest to take it over if required.


That is where an IPS (Investment Policy Statement) comes in. There seems to be an allergic reaction to the discussion or mention of IPS in this forum and it is unfortunate. Without a plan, how do you know where you are going and why? And how does anyone else know how to read the map on where you are going and why in case they have to drive if need be? What would happen if you got hit by a bus this afternoon?

Anecdotally, in informal discussions I have had with some folk now and then, virtually no one has anything written down on paper albeit most rely on their FA to create the map and the investor defers. 

DIYers need to create their own IPS. A single person may not need too if they are willing to let their POA, etc. just wing it, but it borders on irresponsibility not to have one if they have a dependent spouse. An IPS can be as simple as 1 page though I have found it takes 2-3 pages to lay it out. They are especially important as one gets to mid-career and is developing a nest egg for retirement. P.S. An IPS should always end with a succession plan section.


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## ian (Jun 18, 2016)

One of my key requirements, over and above the usual, when shopping for a wealth management firm was to find one that my spouse was very comfortable with. Comfortable with their approach be even more important comfortable on a personal level with their team. Finding the right firm, and consolidating our assets, was part of an overall survivor/estate plan. She is little interest in our investments. I wanted a situation where she felt comfortable with the people, One phone call should that day arrive, would be all that would be necessary for her to move forward on her own.


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## Gator13 (Jan 5, 2020)

Definitely glad this topic came up. I have some work to do. Would an IPS be the appropriate place to include details on such things as IPP, CCPC shares, etc. or should it be restricted to investment accounts?


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## kcowan (Jul 1, 2010)

ian said:


> One phone call should that day arrive, would be all that would be necessary for her to move forward on her own.


Yes us too an my $500k life insurance policy should handle 10 years? of added MERs. I know she won't be happy putting it all in MAW104 without any hand-holding.


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## agent99 (Sep 11, 2013)

ian said:


> One of my key requirements, over and above the usual, when shopping for a wealth management firm was to find one that my spouse was very comfortable with. Comfortable with their approach be even more important comfortable on a personal level with their team. Finding the right firm, and consolidating our assets, was part of an overall survivor/estate plan. She is little interest in our investments. I wanted a situation where she felt comfortable with the people, One phone call should that day arrive, would be all that would be necessary for her to move forward on her own.


I can see that is important. If I recall, PH&N are based in Vancouver. Ideally we would want to deal with someone locally who we could talk to on a personal level. Our investments are with BMO Investorline. Bank with BMO and RBC. Probably need to talk to locals to see what has worked for them.


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## kcowan (Jul 1, 2010)

PH&N is owned by RBC so I think you will find someone locally. We have some of their funds because of very low fees.


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## ian (Jun 18, 2016)

We have not noticed any negatives since RBC took over PHN. Our contacts remain the same. One benefit is access to more funds though.

For us, it was as much about the people as it was about the firm. One thing surprised me when we started to shop. I worked with a lot of smart, savvy people. I started by asking a few of them who they dealt with and whether they were happy with the relationship or the results. I was quite surprised to find that many of them were no happy with one, or two of these. Lots of grumbling and noise about doing something about it.

I also worked with a few people who moved their DB commuted value into the DC plan in 2000. They managed it themselves. Three years later, after the tech fiasco, some were sitting at 50-60 percent of their original number. Same for the 2009, and worse. Some pulled out of equities and did not participate in the rebound. 

This is not just about investment knowledge or smarts. It is also a personalities and aversion to risk.


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## Spudd (Oct 11, 2011)

My mom uses TD Private Investment Counsel and I recently became her POA so have been dealing with them. They manage everything, they consult with her on an annual basis, but she does not have to give investment direction at all. They are very good to deal with, very responsive service. My only complaint is that I have to phone them for everything, rather than having an online way to withdraw money when needed. But when I phone I get the same person every time, and she is excellent. I can't say what the fees are as I haven't seen any statements (they get sent to my mom rather than to me).


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## Longtimeago (Aug 8, 2018)

The first time I ever heard the term, 'wealth management companies', it made me laugh. It still does. Nothing like kissing butt of potential middle class clients by telling them they are 'wealthy.' 

Or are we to expect that 'wealth mangement companies' only deal with people in the top 1% of all Canadians? You can find a definition of 'wealthy' for Canadians about half way down this page: https://business.financialpost.com/...ich-heres-how-to-tell-and-why-you-should-care

A minimum of $1 mil in investable assets not including hard assets like a house, cars, etc.

Wealth Management companies, hilarious.


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## Money172375 (Jun 29, 2018)

Personalized wealth advice at TD starts at around $100,000 in investable assets. Falls under the TD Wealth banner. At that level, you’re dealing with a financial planner...strictly a mf solution, but does include a rather robust personal financial plan. They’ve been shifting to fee based accounts recently vs higher MER solutions.


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## AltaRed (Jun 8, 2009)

Money172375 said:


> Personalized wealth advice at TD starts at around $100,000 in investable assets. Falls under the TD Wealth banner. At that level, you’re dealing with a financial planner...strictly a mf solution, but does include a rather robust personal financial plan. They’ve been shifting to fee based accounts recently vs higher MER solutions.


Is there a particular reason why you are flogging TD? Perhaps some disclosure is in order?


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## ian (Jun 18, 2016)

I believe some firms that had their roots in HNW (high net worth clients) realize the potential of aging baby boomers. Lots of wealth there in the 1-3M market. Lots of fees to be captured. Probably why the some banks have moved to make acquisitions in that area. Some of them have offerings targeted at what they market as the wealth management space and the HNW space. Those two spaces seem to be treated very differently. Not certain where the banks are. 

One thing for certain is that our bank has software that watches our account. We sometimes have funds flowing through our current account from EQbank and PHN/RBC. Every once in a while when we have a larger deposit flowing either way someone from the bank call and ask us to come in and discuss our 'needs and goals'. No thanks. The money only remains their for a day or so.


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## like_to_retire (Oct 9, 2016)

AltaRed said:


> Is there a particular reason why you are flogging TD? Perhaps some disclosure is in order?


Yeah, too many pumps in this thread. I think we need a disclosure....

ltr


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## Money172375 (Jun 29, 2018)

AltaRed said:


> Is there a particular reason why you are flogging TD? Perhaps some disclosure is in order?


No particular reason. Just a former employee interested in providing some insights. I Hear a lot of opinions and try to clarify where it may make sense.....like “wealth management” only catering to $1million+. I’ll join conversations bashing banks, but i also like to clarify things. often issues customers face often come down to lack of information on the customers part or lack of education on the banks part.

If it’s offside I’ll cease and desist.


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## AltaRed (Jun 8, 2009)

No, it's not offside, but a disclosure is respectful, e.g. Disclosure: former TD employee.... Or Disclosure: Have accounts with TD Private Investment Counsel

Added: I agree DIY financial forums tend to be disparaging against professional advice, both warranted and unwarranted. Thick skin goes with the territory.


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## agent99 (Sep 11, 2013)

Money172375 said:


> No particular reason. Just a former employee interested in providing some insights. I Hear a lot of opinions and try to clarify where it may make sense.....like “wealth management” only catering to $1million+. I’ll join conversations bashing banks, but i also like to clarify things. often issues customers face often come down to lack of information on the customers part or lack of education on the banks part.
> 
> If it’s offside I’ll cease and desist.


No, I think it's great to get some insider info. Especially when we now know where it is coming from.


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## humble_pie (Jun 7, 2009)

there is a colossal difference between offering advice + financial planning + limited tax & estate planning services to clients who are 1) hale, hearty & of sound mind; 2) who are consulted re all decisions; 3) who consent or agree to each decision

*VS*

providing discretionary portfolio management (the advisor is licensed to act without consulting the client) to clients who are 1) frequently absent on business or else incapacitated to some degree; or 2) are of minor age or otherwise not financially literate, therefore cannot manage their finances themselves; or 3) the "client" is an estate or trust that has formally engaged professional portfolio management services.

in the above situations, clients are not consulted regarding individual portfolio changes. Their consent to discretionary portfolio management is always obtained in advance, or else it should be (note that clients will be informed of portfolio changes after the fact, or even during a period of major change; but their consent does not need to be obtained.) 

the latter group are nearly always high net worth individuals or estates or trusts with a threshhold of $2m, in some cases as low as $1M. A client today who is seeking financial or estatement management services for his heirs after he has departed this earth or been incapacitated by advancing old age himself, will not find professional portfolio management services (discretionary services) unless the portf is at least $1 million.


this leaves a staggeringly vast population of average net worths from say $250k to $1-2 million who, for one reason or another, will require ethical & professional portfolio manager services for their investments for a period of time, either when they are very old or ill themselves or for their non-financially literate heirs after their deaths.

for this middle range group, discretionary services are not normally available. There are parties with lower level licenses who represent themselves as having passed the official "portfolio manager" licensing exams; but in reality they do not have discretionary authority over their clients' investment accounts, regardless of whether or not vulnerable clients may have signed a form giving such parties discretionary power.

note that in canada, the previous title for licensed discretionary financial managers was "Investment Counsel." This title has changed & the title today is "Portfolio Manager." There are stiff exams to pass. True portfolio managers can be found at private firms, at big banks' wealth management divisions for high net worth clients, there are also some at large full-service brokerage houses.


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## humble_pie (Jun 7, 2009)

AltaRed said:


> Is there a particular reason why you are flogging TD? Perhaps some disclosure is in order?



a retired former financial planner/investment advisor from a chartered bank or from any other wealth management firm does not need to disclose his previous employer IMHO.

there have always been quite a few retired financial planners in cmf forum. None ever declared. Nevertheless they were/are conspicuous!

on the other hand the situation is different if a client-seeking financial organization were to enroll a "member" here whose real role would be to act as a salesman. We had this situation in the past, back in the day when CC & Frugal owned cmf forum & they actively forbade such marketing. I distinctly recall CC posting that he would ban one persistent big bank marketer if he were to continue his hard sales posts (the marketer promptly stopped)

IMHO money17digits upthread is mild, informative & helpful. I'd be interested in hearing any suggestions he may have for licensed discretionary portfolio management that is available for the sub-$1M crowd.


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## Money172375 (Jun 29, 2018)

humble_pie said:


> a retired former financial planner/investment advisor from a chartered bank or from any other wealth management firm does not need to disclose his previous employer IMHO.
> 
> there have always been quite a few retired financial planners in cmf forum. None ever declared. Nevertheless they were/are conspicuous!
> 
> ...


Sorry, but don’t know of any discretionary money managers for the sub $1million crowd. Almost certain you wouldn’t find it at the big banks. You may find someone who would take on a smaller account with the knowledge it would surpass $1million in a few years. As I’ve said on other posts, most clients were very happy with the Investment Advisors who can offer similar solutions to the discretionary managers......they’re all getting the same economic updates/information/research. Only real difference is the discretionary component (as they rely more on model portfolios) vs. Individual equity/ fixed income selection. 

....and trust me....my “sales” days are over......it can be a grind.....I enjoyed building relationships and helping to educate.....but that doesn’t always translate to the results that are expected quarter after quarter. Nature of the business I guess...no hard feelings.


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## Money172375 (Jun 29, 2018)

humble_pie said:


> there is a colossal difference between offering advice + financial planning + limited tax & estate planning services to clients who are 1) hale, hearty & of sound mind; 2) who are consulted re all decisions; 3) who consent or agree to each decision
> 
> *VS*
> 
> ...


There may be some services you seek through the “private banking” and/or the “estate and trust” divisions. Iirc, while they will often seek $1 million minimum, it can include real estate and/or other assets (Gics) that aren’t part of the “investable assets” amount. I suppose their hope is that the real estate or gics will be liquidated and/or transferred to next of kin.......and then can form the new investable assets of the next generation. The banks would love to be your executor. . I will say that my experience showed that it really was a “needs based approach” and while each silo of the bank would be happy to make their pitch.....in reality, the customers are all part of the “wealth” division, so the VP in charge probably didn’t care where the customer ended up, as long as they came over and STAYED....so getting the customer in the right solution up front is paramount.


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## humble_pie (Jun 7, 2009)

Money172375 said:


> There may be some services you seek through the “private banking” and/or the “estate and trust” divisions. Iirc, while they will often seek $1 million minimum, it can include real estate and/or other assets (Gics) that aren’t part of the “investable assets” amount. I suppose their hope is that the real estate or gics will be liquidated and/or transferred to next of kin.......and then can form the new investable assets of the next generation. The banks would love to be your executor. . I will say that my experience showed that it really was a “needs based approach” and while each silo of the bank would be happy to make their pitch.....in reality, the customers are all part of the “wealth” division, so the VP in charge probably didn’t care where the customer ended up, as long as they came over and STAYED....so getting the customer in the right solution up front is paramount.



hello money17 ... i'm focusing strictly on the ethical discretionary portfolio manager approach because that is what some parties in this forum are discussing for their non-financially-literate heirs, assigns & familly members if something should happen to their heretofore stalwart DIY approach.

is it possible to focus on this group. To whom may they turn for licensed, ethical discretionary portfolio management when they themselves become unable or unwilling to carry on themselves.

this group sub-divides into the $2 million & up, who can find portfolio managers for an exceedingly high fee in dollar terms, since their portfs are large to begin with.

below $1 million are the non-discretionary advisors who can offer advice but they are not supposed to carry out discretionary trades.

my point is that due to aging population canada is going to see more & more baby boomers who require ethical discretionary portfolio managers either for themselves or for non-financially literate heirs; but these services are generally not available for the sub-$1-2M DIY investor.

even at $2M portf & up, the fees are horrifically high. Sticker shock - which some have voiced here in cmf forum - is real.


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## humble_pie (Jun 7, 2009)

Money172375 said:


> Sorry, but don’t know of any discretionary money managers for the sub $1million crowd.



yes, that's what i was saying. Thankx for clarifying. Although there is a big need for reliable ethical management in this sub-1M zone.





> As I’ve said on other posts, most clients were very happy with the Investment Advisors who can offer similar solutions to the discretionary managers......they’re all getting the same economic updates/information/research.



agreed they are all getting the same economic updates/info/research.

the difference is Who is licensed ethical & Who is more-or-less a chemistry of trust between advisor/salesman & client who may be succumbing to advancing old age?

i am of course aware that managers at wealth management firms including big bank full service brokerages & upwards through PM levels are relentlessly monitoring their advisors for appropriate conduct. But there are armies of smaller firms out there & the risk of a vulnerable client stumbling into a quasi bernie madoff or quasi earl jones is real.


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## off.by.10 (Mar 16, 2014)

humble_pie said:


> my point is that due to aging population canada is going to see more & more baby boomers who require ethical discretionary portfolio managers either for themselves or for non-financially literate heirs; but these services are generally not available for the sub-$1-2M DIY investor.
> 
> even at $2M portf & up, the fees are horrifically high. Sticker shock - which some have voiced here in cmf forum - is real.


It's an interesting problem. I agree that it should be possible to have someone carry out a basic investment plan requiring a few yearly trades for less than $10k+ in fees annually. It's not that much work.


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## AltaRed (Jun 8, 2009)

off.by.10 said:


> It's an interesting problem. I agree that it should be possible to have someone carry out a basic investment plan requiring a few yearly trades for less than $10k+ in fees annually. It's not that much work.


It certainly should be possible but there doesn't seem to be many out there who are willing to do much without outrageous % of AUM fees. Ron Carrick often quotes John Robertson's 'fee only planner' spreadsheet here https://docs.google.com/spreadsheets/d/1iGzy9kkSXqjGbhXfcfczs9qwSQfI1PdRuNUOMybxvl4/edit#gid=0 for a list of planners and coaches. Note the speadsheet is misnamed. There are a variety of service models in the spreadsheet. 

The dilemma here, as I see it, is how does one do their due diligence to avoid an Earl Jones https://www.cbc.ca/news/canada/montreal/earl-jones-gets-11-years-for-50m-fraud-1.870065 in these smaller entities?

The important thing is to have a simplified portfolio along with an IPS such that your POA has a better chance to either continue management of the portfolio on a DIY basis, or can find a relatively inexpensive 'fee only for service' planner on a monthly retainer basis to help with the decision making. OR also add discretionary trading, but to limit rights to trading only, not transfer outs like a full POA would have the right to do. 

If a portfolio is all in VBAL or a 3 fund ETF portfolio, it doesn't take much effort at all to sell enough units on an ongoing basis to provide cash flow. A once a year review by a fee only planner can fine tune direction for the following year.

None of this addresses the other estate planning issues however. But I suspect there are many fee only planners in the spreadsheet who could at least point someone in the right direction, if not take responsibility for it. One last comment. Whoever it is should have a fiduciary duty to the client.


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## ian (Jun 18, 2016)

We tend to look at incremental cost vs. incremental benefit. And we look at it from an after tax basis as we do all spending. So we compare the costs, the MER's with perhaps a DIY portfolio vs one that is fee for service managed.

We were in a fee for service program with a major bank. The service was terrible. We complained several times, then gave up. The investment returns were just one issue. We switched to a what was then an independent wealth management firm. The difference from all perspectives was like day and night. And the net cost to us was slightly less.


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## OptsyEagle (Nov 29, 2009)

> It certainly should be possible but there doesn't seem to be many out there who are willing to do much without outrageous % of AUM fees


I think most of us on this board have little idea of the true cost of providing financial advice and portfolio management. We see an ETF offering to take our money for 10 basis points or less and seem to think that all other competitive arrangements should be offered somewhere in that area.

We need to keep in mind that in order to offer us a discount level of financial services (TDDI, RBCDI, etc) they need to provide a rather expensive trading platform. That platform must have a secure link to the trading floors of many, many various stock and bond exchanges. They need to be able to calculated and issue tax slips in accordance with ever changing tax rules. Administer accounts based on those very same, ever changing, sometimes complex rules. They need to report to the client quarterly and annually with statements and confirm every trade quickly. It has to be fast and reliable. Lastly it has to be absolutely bullet proof safe and offer safe and secure online access, now through both computer and cellphone. Of course nothing works perfectly nor are two clients similar in their technical or investment skills so you always require a fully licensed trader to answer questions via phone or email/text.

That just covers the discount brokers. Now we say we want financial planning advice. That requires many hours of schooling and probably about a minimum of 3 accreditations for the advisor, along with a stock trading license and an insurance license. That kind of stuff does not get offered to anyone at minimum wage. 

Perhaps we now want estate and tax advice. Again, another slew of training and accreditations, that does not keep the cost to the consumer down, by any means.

Lastly we then want discretionary portfolio management. This requires another 1 or 2 accreditations, plus in order to scale this, one requires another more sophisticated trading platform. What I mean by that is if you have 300 clients, all with the same descretionly managed portfolio, and let's say BCE is in it and you decide it needs to be sold. Does anyone know how long it would take a trader to sell 300 different position of BCE for that purpose. God forbid you had to call each one to get approval. Add to that the fact that in that unscaled system someone will get a better price and someone else will not. One client must front run the other. That is not good. Soooo, you now need a way of having BCE in one central portfolio where the benefit is dispersed to all 300 clients in the varying amounts each would hold. If BCE needs to be sold and your entire book has 16,112 shares, you simply sell that much in one trade and distribute the proceeds accordingly. This must be done by another layer or trust that is involved with the discretionary portfolio. Again, more costs.

Now add accounting and storage of data and my ever favourite and absolutely expensive, compliance department, to hopefully ensure the advisors/portfolio managers do what they say they will do and not do anything they are not supposed to do. Keep a watchful eye on things. Without it, it all falls apart quickly.

*That certainly does not come at a price of 10 basis points.* I suspect even 1% of AUM would quickly become a loss to the firms unless the AUMs rose rapidly and/or the minimum $100 million dollar book required to be managed at that price was owned by less then 25 households.


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## agent99 (Sep 11, 2013)

ian said:


> We switched to a what was then an independent wealth management firm. The difference from all perspectives was like day and night. And the net cost to us was slightly less.


I think I read that PH&N/RBC charge a base fee (~0.5%?) and on top of that like many money managers also require you to own their mutual funds (that have the usual MERs). This can of course add up. But if it means you don't have to be involved and they churn out enough income, I suppose you (and they) are happy. 

Even the Robo-adviser have fees in the 0.5% range plus the MERs of the ETFs they seem to use. Haven't looked at those yet. They could, I suppose, be an option for those without ability to mix and match ETFs for themselves.


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## AltaRed (Jun 8, 2009)

Obviously it depends on what all one needs out of the wealth management firm. Those needing the whole meal deal (financial planning, accounting, tax, estate, trading) are going to pay for all that. I would agree 1% of AUM on a $1M account ($10k) is not likely enough for all those services. Not everyone needs all those services.

The simplest of what I alluded too, which is a fee-for-service advisor that develops financial plans for the individual (for $1-2k) and then has trading authority on the client's DIY discount brokerage account. The client continues to get his/her statements from the discount brokerage, along with all the tax slips as we do today. The client can then either do his/her tax returns on his/her own, hire a tax professional, or if the fee-for-service advisor is qualified, have that advisor do those tax returns for a fee. I personally know of a few such advisors.

A step up on the above is where the same fee-for-service advisor has discretionary authority to fully manage the money but still have a discount brokerage hold the accounts. Another step up is where the advisor is the one contracting for brokerage services. and the client looks to the advisor for statements, tax slips, etc. In all the above cases, the fee-for-service advisor needs nothing more than a real time Level 2 trading platform...which I get at no cost myself at Scotia iTrade, but also has considerably more regulatory oversight.

Then it gets to where almost everything is done in-house maybe with a Bloomberg terminal, compliance, accounting, audit, etc.

My point is there is a very wide range of potential models, obviously at different cost levels, depending on firm size, service model, etc. PH&N mentioned by Ian obviously is a large firm with the full meal deal of costs, regulatory oversight, etc, etc. That is a long ways from a simple $1M DIY account with trading authority and perhaps tax returns.


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## Money172375 (Jun 29, 2018)

AltaRed said:


> It certainly should be possible but there doesn't seem to be many out there who are willing to do much without outrageous % of AUM fees. Ron Carrick often quotes John Robertson's 'fee only planner' spreadsheet here https://docs.google.com/spreadsheets/d/1iGzy9kkSXqjGbhXfcfczs9qwSQfI1PdRuNUOMybxvl4/edit#gid=0 for a list of planners and coaches. Note the speadsheet is misnamed. There are a variety of service models in the spreadsheet.
> 
> The dilemma here, as I see it, is how does one do their due diligence to avoid an Earl Jones https://www.cbc.ca/news/canada/montreal/earl-jones-gets-11-years-for-50m-fraud-1.870065 in these smaller entities?
> 
> ...


Keep in mind that fees for discretionary service are also a tax write off.


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## Money172375 (Jun 29, 2018)

Well said Oeagle


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## Money172375 (Jun 29, 2018)

AltaRed said:


> Obviously it depends on what all one needs out of the wealth management firm. Those needing the whole meal deal (financial planning, accounting, tax, estate, trading) are going to pay for all that. I would agree 1% of AUM on a $1M account ($10k) is not likely enough for all those services. Not everyone needs all those services.
> 
> The simplest of what I alluded too, which is a fee-for-service advisor that develops financial plans for the individual (for $1-2k) and then has trading authority on the client's DIY discount brokerage account. The client continues to get his/her statements from the discount brokerage, along with all the tax slips as we do today. The client can then either do his/her tax returns on his/her own, hire a tax professional, or if the fee-for-service advisor is qualified, have that advisor do those tax returns for a fee. I personally know of a few such advisors.
> 
> ...


Disclosure: former td employee.

During my time, discretionary fees started at 1.3% for $1 million. Fees went down from there depending on account size. I suspect there was some decent wiggle room. I wasn’t privy to how low they went, but the mantra of the fee getting lower with increased account size was often highlighted. This is going back a few years when low fee ETFs were never even talked about. I’d be curious to see what the fees look like today.


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## ian (Jun 18, 2016)

Fees are based on amount under management. Funds are broken down by series. Our investments in a fund carries no MER. It is not a case of paying a management fee and then a MER on top of that. Our fee is slightly under one percent. When we first started shopping there were two options. An advisor but essentially you select or full management. We selected the latter. Not certain what the parameters are now. It was very similar to two other firms we were considering at the time. Forget the name of one, I think that it was bought out by Scotiabank. Yes, the fees are written off. The spousal loan details are taken care of with proper timing and accounting as per CRA. Our advisor is a CPA with a tax specialty along with the other usual designations. 

I grew up in Pointe Claire/West Island and followed the Earl Jones mess. Similar situations occured when we lived in Vancouver when we lived there, and in Calgary.


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## agent99 (Sep 11, 2013)

Ian,
We too lived in Montreal when we were young.. We knew Earl Jone's wife Maxine quite well. Skied with both of them once or twice. That was before he went astray.

Knowing what went on there makes us cautious about handing over our savings to anyone!

I just saw an ad on tv for Schwab Intelligent Income - aimed at retirees. Seems to offer a blend of advice along with automated investing. Costs I saw were $300 for initial interview and then $30/month. They didn't require huge accounts. $25000, I think for the Premium version. Dont know how this compares with Robo offerings here. These things might be better than some of those advisors on Marketplace!


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## ian (Jun 18, 2016)

To me, the Earl Jones thing was similar to an affinity type fraud.

Bottom line is that had even ONE of his clients had called the Regie (Provincial Securities Commision) that person would have not only found out that he was NOT registered but it would have resulted in an investigation. Just one phone call from one person to check on his status with the authority could have nipped this in the bud. Not much different that a mortgage investment fraud that went down in Calgary last year. But apparently no one did until it was too late.

The victims were friends, friends of friends who did far less investigation into the person/firm who was looking after their retirement savings than they probably did buying a new washing machine, a stereo system, or a new car.


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## humble_pie (Jun 7, 2009)

AltaRed said:


> Whoever it [advisor to a vulnerable investment account] is should have a fiduciary duty to the client.



this is the heart of the problem. No advisor below the level of licensed Portfolio Manager has any legally binding duty to a vulnerable client whatsoever. He may have marketing charm, he may have good reputation, but these are not legally binding.

it's my understanding that "fee-only financial planners" are not licensed & examined by regulators in any province other than quebec. IE anyone can market himself as a financial planner. In effect, the field generated by this catch-all phrase is vast & populated by all kinds of parties with all kinds of financial backgrounds, or lack of backgrounds.

obviously there are many capable "fee-only financial planners" such as those with active CPA accounting practices in every province. However one can also find insurance salesmen, mortgage brokers, parties with limited knowledge of financial markets who only hold easy-to-obtain mutual fund sales licenses (alas these are often the same parties who are selling the infamous private real-estate investment products.)


back to the top echelon Portfolio Managers, who are licensed across canada. Some of these firms have in-house pooled funds which allow accredited investors to experience the firm's work for minimal $150,000 investment. Could be helpful trial run before signing up the $$ millions.

some PM firms also have negotiable fees. Few years ago cmf forum had a high-net-worth member who negotiated his big bank full-service wealth management division down as low as (he said) .50% fee. It was & remains the lowest fee on record here. He was buying a stable small family of ETFs, they would essentially be babysitting with discretion to re-balance.


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## Money172375 (Jun 29, 2018)

humble_pie said:


> this is the heart of the problem. No advisor below the level of licensed Portfolio Manager has any legally binding duty to a vulnerable client whatsoever. He may have marketing charm, he may have good reputation, but these are not legally binding.
> 
> it's my understanding that "fee-only financial planners" are not licensed & examined by regulators in any province other than quebec. IE anyone can market himself as a financial planner. In effect, the field generated by this catch-all phrase is vast & populated by all kinds of parties with all kinds of financial backgrounds, or lack of backgrounds.
> 
> ...


Many of the traditional Investment Advisors at full serve brokerages have been obtaining their Portfolio Manager designation. Seems like a step in the right direction......allows them to likely take on smaller accounts and also be able to offer full discretion and non-discretionary accounts.

For the layperson, there is little difference in the tittles: financial advisor, financial consultant, financial planner, investment advisor, investment consultant, mutual fund representative, portfolio manager. If I’m not mistaken, each of the titles can only be used when certain courses/licenses are obtained. However, it’s very confusing and the average person has no way to determine how each relates to experience and/or education. Certainly an opportunity for better regulation. If I were looking for financial planning advice, at a minimum I’d be looking for someone with their CFP. For investment advice, portfolio management title is the way to go.

I remember about 20 years ago I had to use the title Financial Associate until I passed some exam....then I could use the title Financial Advisor. Or was it Adviser? (That’s a whole other issue)


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## humble_pie (Jun 7, 2009)

Money172375 said:


> Many of the traditional Investment Advisors at full serve brokerages have been obtaining their Portfolio Manager designation. Seems like a step in the right direction......allows them to likely take on smaller accounts and also be able to offer full discretion and non-discretionary accounts.



yes this ^^ is true. Save & except that at that PM level they only want larger accounts ... $2 million is often a starting threshhold.

one advantage of a professional who can offer both full discretionary & non-discretionary accounts is that such professional is more easily able to work with the hodge-podge of "investments" which a client might bring to him. Some of those investments - such as those nefarious mortgage private investments - reportedly get refused outright. One cannot imagine a PM being willing to accept Venture Exchange or pink sheet speculation either.






> For the layperson, there is little difference in the tittles: financial advisor, financial consultant, financial planner, investment advisor, investment consultant, mutual fund representative, portfolio manager. If I’m not mistaken, each of the titles can only be used when certain courses/licenses are obtained. However, it’s very confusing and the average person has no way to determine how each relates to experience and/or education. Certainly an opportunity it’s for better regulation.



agree that the terms are confusing to the general public, even to the longtime savvy DIYer. Is why one needs to take time, do research & plan carefully.

BTW Money17 i've omitted so far the very large category of "advisors" at different levels working out of our big 5 chartered banks & would like to update the record ...

bank financial advisors are closely supervised & monitored. The big 5 banks are also closely supervising/monitoring their brokerage divisions. Bank management's goal is to make sure that their advisors do not sell or recommend inappropriate investment products. It's my belief that the big banks are very active in this regard, in order to protect their reputations.

for this reason, it's my working belief that big bank financial product salespersons, aka investment "advisors" or "dealers," will be more closely supervised & more ethical than the financial salesmen working out of local street corner offices as insurance or mortgage brokers who also run "financial planning" businesses & can easily advertise themselves as "fee-based financial planners" because outside quebec there is no regulation of this industry.

i could be wrong, but if you look at the CBC video exposing a number of shady investment salespersons that was posted by one cmffer recently, the dodgy salespeople were mostly from smalltime independent offices or smaller financial firms that were far below the size of the big canadian banks.

continuing with the big banks theme, i don't believe any of our big 5 chartered banks would allow an "advisor" below the level of licensed Portfolio Manager to take on a discretionary role with a vulnerable client, or even accept a power-of-attorney mandate over a client's account.

for this reason i find altaRed's cheerful description of so-called "financial planners" being trustingly given POA for several levels of investment management, to be somewhat on the naiive side. Small firms, independent offices & individuals who have styled themselves as "financial planners" may operate to the level of accepting personal POA mandates; but i don't believe the big 5 banks will ever allow this among their own very numerous financial advisors, other than their licensed Portfolio Managers.


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## Money172375 (Jun 29, 2018)

humble_pie said:


> yes this ^^ is true. Save & except that at that PM level they only want larger accounts ... $2 million is often a starting threshhold.
> 
> one advantage of a professional who can offer both full discretionary & non-discretionary accounts is that such professional is more easily able to work with the hodge-podge of "investments" which a client might bring to him. Some of those investments - such as those nefarious mortgage private investments - reportedly get refused outright. One cannot imagine a PM being willing to accept Venture Exchange or pink sheet speculation either.
> 
> ...


Correct. I acted as Branch Compliance Officer for a retail branch. Discretionary trading absolutely not allowed. I found we were very strict. Not accepting very many trade requests that fell outside of a customer given investment profile. Only small portions in “high risk” funds were allowed, if any. Often made customers upset, since they wanted to buy different funds than were recommended. “I want to buy the Canadian equity fund”. Sorry, you can’t...you told me your risk tolerance was low and your time frame was less than 5 years. Okay then, I’ll change my answers. It was a common battle. No PoAs allowed on client accounts either. Regular training was documented monthly. Any written complaints went directly to head office. New reps were directly supervised for 3-6 months and couldn't even open a new account with my approval. It was tight, but necessary in my opinion.


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## humble_pie (Jun 7, 2009)

yes i thought you'd have info such as the ^^ above

was not expecting anything quite *so* strict though!

i was wanting to enlarge/add to my previous views because i do believe that our big canadian banks are sincerely doing a good job preventing serious financial fraud & expoitation. And our banks are collectively serving a gigantic population of middle-class investors, so all this is a benign picture. A lot of people are receiving appropriate decent-enough advice and/or migrating to the bank-owned discount brokerages, where any mistakes they might make will be strictly on their own tab.

unregulated self-profiled "fee-based financial planners," particularly from little-known small firms, are another category when it comes to vulnerable clients though. Superficially their appeal might be because they charge so much less, or are thought to charge less.

i'm back to my original pov, which is that the $250k-$1million investment account owner does not easily have access to proper discretionary financial management should something happen to him, unless he happens to have a spouse or sibling or adult child POA who is a financial wizard.


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## OptsyEagle (Nov 29, 2009)

If there are any ethical improvements between bank and independent advisors and their branch managers, I would bet it comes more from compensation differences then it does from firms concerned about their reputation. I find the only ones worried about their reputation, in these firms, are the ones who have no skin or gain in a particular transaction. Anyone getting paid is usually always for it. I suspect you would find a lot more bank advisors/managers that have a fixed salary with either commission or bonuses on top of that. In the independent world it is usually 100% commission. I think if you looked at the 100% commissioned bank advisors, for example the CIBC Wood Gundy's or the Scotia McLeod world, you would see similar behaviors like you do in the independent world. Just my guess of course.

As we should know by now, bias is the biggest culprit to bad behavior, but you pretty much never get the same service level from someone who has a salary as you do from someone who is on 100% commission. The difference, I have seen, is the person with the salary knows their boss is in the office a few doors down and the person on commission knows their boss is the client sitting directly in front of them. Anyway, I would take ethics over service any day, but both would be nice.


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## ian (Jun 18, 2016)

We found what could only be described as an astonishing difference between our previous fee for service bank advisory service and the investment firm that we migrated to. For a start the conversation was on a much higher level. My spouse was engaged, not ignored. The advice focused investments, opportunities, general financial planning, tax planning, etc. The last straw was two or three advisors at the bank over a two year period. We have had the same advisor since we fired the bank-about nine years. We sensed the bank was either loosing senior people to competitors or culling senior, experienced staff to replace them with lower paid, younger, less experienced staff. 

Bottom line difference from the bank fee for service that we experiences.. ...lower net fees, better advice and guidance, better reporting, tax review prior to year end, and much more personalized service. As a result we pulled everything after 30 years with the same bank. Saving account went to online high interest bank, dumped their premium credit card in favour of a more competitive product. Only thing we have at that bank is a safety deposit box and a no fee seniors current account.


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## humble_pie (Jun 7, 2009)

ian said:


> We found what could only be described as an astonishing difference between our previous fee for service bank advisory service and the investment firm that we migrated to. For a start the conversation was on a much higher level. My spouse was engaged, not ignored. The advice focused investments, opportunities, general financial planning, tax planning, etc. The last straw was two or three advisors at the bank over a two year period. We have had the same advisor since we fired the bank-about nine years. We sensed the bank was either loosing senior people to competitors or culling senior, experienced staff to replace them with lower paid, younger, less experienced staff.
> 
> Bottom line difference from the bank fee for service that we experiences.. ...lower net fees, better advice and guidance, better reporting, tax review prior to year end, and much more personalized service. As a result we pulled everything after 30 years with the same bank. Saving account went to online high interest bank, dumped their premium credit card in favour of a more competitive product. Only thing we have at that bank is a safety deposit box and a no fee seniors current account.




one has to compare apples to apples though. The first paragraph above describes the excellent services provided by a well known discretionary portfolio manager. There is a high dollar threshhold to becoming their client. One could call this an apple. A choice, heritage, organic apple.

the second paragraph describes service that might typically be provided by the walk-in financial advisory services of a canadian bank branch. These will never be as polished or as sophisticated as portfolio manager/investment counsel, although the fees paid could be equivalent.

one could call bank branch financial service an orange. It's not the same thing as the apple described in first paragraph. Just one difference: discretionary portf management/investment counsel is not available in-branch. Another difference: portf management/investment counsel requires minimum $1 million, often $2 M or more at some firms.

walk-in bank branch financial management services (oranges) are described by Money17 earlier in this thread. They are designed to serve a lower wealth level, ie investors with $5k to $1M. Depending on the actual branch personnel, services can range from mediocre to excellent.

as ian points out, branch personnel can change frequently & these rotations impact an investment client negatively.

in the remote event that ian's 2nd paragraph is describing the portfolio management/investment counsel division of a big bank - ie it was another apple - one can only say that ian made the right decision to depart as rapidly as possible.

note that the discretionary financial management industry appears divided, these days, about how to entitle itself. Formerly known as "investment counsel," the industry changed its official name to "portfolio manager" some years ago. Their professional association, formerly Investment Counsel Association of Canada, became & remains today Portfolio Manager Association of Canada.

but recently some of their senior members have reverted to calling themselves Investment Counsel. PH & N discretionary financial management, now owned by RBC, has gone back to calling itself Investment Counsel, for example.

still others are avoiding the title controversy entirely by calling their firm "wealth management."


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## ian (Jun 18, 2016)

yes, the bank service we fired was portfolio management/investment counsel division one of the big 3 banks. That is what we were sold. What we got was something entirely different. We made our feelings known on three occasions. It was clear to both of us that listening was not their strong suit so we walked. I was subsequently told by someone a year or two later that it was a known issue and that the bank had lost a number of customers to competitors. Could be better now..I have no idea.


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## AltaRed (Jun 8, 2009)

An example of the kind of minefield that can occur with small firms https://www.investmentexecutive.com...age-firm-sanctioned-for-supervisory-failures/


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## OptsyEagle (Nov 29, 2009)

The unfortuneate thing with unsuitable investments is that they only seems to be unsuitable when they go down.

Obviously, many investments are unsuitable for many investors, but even the most blue chip, etc., will always appear to be unsuitable when they go down. Even when investors are told that these investments fluctuate, even when they sign a risk tolerance form or two, when they are staring at an account statement indicating to them that they currently have only 80% of the money they invested, they somehow seem to believe that this was not what they were signing up for and that the advisor must have completely misunderstood.

As I said, in this thread or another, risk tolerance is really only something that can be guaged when the risks are starting to show themselves. The risk isn't just the fact that their account values can go down. It is the fact, that when it is down, the only reason it is down, is the people selling it are absolutely sure it will go down more and are more then happy to let everyone know. They do tend to make a lot of convincing arguments that one has to fight against, to be a good investor. Plus, in hindsight looking back, it always appears that there were many times that a financial advisor could have gotten out of it before this time.

Unfortuneately, most of us know by now that there really is no such thing as a market or an investment that is going down. There are only markets and investments that have GONE down. What they will do tomorrow, we will only know at 4 O'clock.


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## smihaila (Apr 6, 2009)

Longtimeago said:


> The first time I ever heard the term, 'wealth management companies', it made me laugh. It still does. Nothing like kissing butt of potential middle class clients by telling them they are 'wealthy.'
> 
> Or are we to expect that 'wealth mangement companies' only deal with people in the top 1% of all Canadians? You can find a definition of 'wealthy' for Canadians about half way down this page: https://business.financialpost.com/...ich-heres-how-to-tell-and-why-you-should-care
> 
> ...


Yup. And the first question that anyone should ask is: "WHOSE Wealth" are those "Management" companies, managing? Their own perhaps.
Where are the customers' yachts? LOL, hilarious.


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