The following text may have been generated by Optical Character Recognition, with varying degrees of accuracy. Reader beware!

23 | Thursday, February 2, 2 0 1 7 | Have candid conversation with advisor about mutual fund fees The winds of change continue to blow in the hnancial services industry. Hopefully, in the not-too-distant future, hidden trailer fees charged by mutual funds will be banned. A trailer fee is an embedded commission paid to the hnancial advisor whose clients own a mutual fund. There are those in the industry w ho believe this may be why some hnancial advisors recommend certain funds over others. Since mutual funds are the m ost popular investment vehicle in Canada, this has impli cations for most investors. In January, the Canadian Securities Admin istrators (CSA) released its m ost recent report on mutual fund embedded trailer keys. The report recommended a ban on all such hidden fees. One of the m ost interesting aspects of the report were the reactions from various groups to the likelihood hidden trailer fees will be banned. Banning fees is all about transparency, and there is a fair amount of transparency in the way various groups have reacted. There is a popular expression, "follow the money," to hnd out the logic behind differing opinions. In this case, hidden commissions send money away from investors and to hnancial advisors. Maureen Jensen, chair of the Ontario Se curities Commission, acknowledges Cana- Dollars & Sense Peter Watson Guest Contributor dian mutual fund fees are the highest in the world. The CSA report predicts mutual fund fees would decrease if embedded commissions were eliminated. Jensen' s comment clearly puts her on the side of investors. Get rid of hidden commis sions and mutual fund fees will be reduced. The client wins. The Portfolio Management Association of Canada had an opinion too. It said investors are best served when there is transparency about the fees they are paying. It is also on the side of investors. It says "no" to hidden trailer fee commissions. These opinions favour lower fees and trans parency to the beneht of investors. A contrast ing positon was offered by the Investment Funds Institute of Canada (IFIC). IFIC said there was no justihcation for ban ning hidden trailer fees and said harmful conhicts of interests are already disallowed under current regulation. So, its vote is to continue with hidden fees and therefore maintain the high cost of mutual fund ownership by Ca nadians. W hile industry participants continue to debate the issue of hidden trailer fee commis sions charged on mutual funds, investors can exercise their influence on an industry they rely on to manage their hnancial assets. If you believe that hidden mutual fund fees are wrong, then I would encourage you to have a candid conversation with your hnancial advisor. Does your advisor benefit from hidden mutual fund fees? If you own such mutual funds, ask your ad visor if there are better alternatives that would have lower fees and a greater probability that you will get higher investment returns. If there are better options available to you, then you have som e decisions to make. Should you change the investments you hold in your portfolio? Should you change advisors? Submitted by Peter Watson of Peter Watson Investments and Aligned Capital Partners Inc, MBA, CFP, R.FP, CIM, FCSI., Certified Financial Planner -- OAKVILLE BEAVER | www.insideHALTO N.com For m ore news visit oakvillebeaver.com S ince 1967 baler's upholstery & design w w w .b a ie rs .c a A FUSION OF JAPANESE & CHINESE CUISINE IN THE HEART OF OAKVILLE! a l l y o u c a n eat 1000's of Designer fabrics to choose Years in business DiNE IN fORALLYOU CAN EAT LUNCH OR DINNER Sofas · Chairs · Headboards · Throw Pillows · Drapery & H ardw are 11-2345 Wyecroft Road,Oakville · 905.616.3156 · info@baiers.ca f As distinctive as you are You are unique. Your family is unique. Ask our trusted specialists about personalized options for lasting remembrance, and preserve the memory of one special life forever. C a ll today to take the first step: 905-257-1100 OAKVILLE 280 North Service Road W.@Dorval 905-338-6228 D Look for us on Facebook glenoaks.ca WE DO TAKEOuT! B urlington h a m ilto n Sto ne y C re e k B ram pton 10% off Glen Oaks Funeral Hom e& Cemetery byArbor Memorial Dinner only. C ash only & with this ad. 3164 Ninth Line (403 & Dundas St.), Miss./Oakville,ON Arbor Memorial Inc. Family Owned. Proudly Canadian.