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Retail investors don’t have much confidence in their own investment ability or in regulators, so they rely primarily on investment firms and financial advisors, according to research from investor advocacy group FAIR Canada.

In an online survey of 1,000 investors across Canada, FAIR Canada found that investors have an array of worries, including concerns about the fees they pay, industry ethics, and regulatory protections.

“Fees are a major concern for investors,” the FAIR report noted. Almost two-thirds (63%) of respondents said they didn’t understand the investment fees they pay, and three quarters (77%) said they felt they were paying too much.

At the same time, 60% were concerned they may be sold an unsuitable product, and 42% were worried that their advisor may behave improperly.

“Those investing through a bank were most likely to be concerned about advisor ethics and self-interest, including the suitability of investment advice,” the report said.

Despite these worries, the survey also found that investors had more trust in their financial advisors and investment firms to protect their interests than in regulators and the federal government. The reported level of trust in the advisor and firm increased with the amount invested.

“The degree of reliance on advisors may stem from the fact that most investors have low levels of confidence when it comes to investing,” the report said.

Respondents reported the lowest level of trust in organizations that advocate on behalf of investors.

“When it comes to trusting their advisor, the findings reveal an uneasy relationship,” said Jean-Paul Bureaud, executive director at FAIR Canada, in a release. “Too many investors are concerned about paying too much in fees and more than half are concerned they will be put into an unsuitable product. The findings underscore the importance of establishing high regulatory, ethical and proficiency standards for advisors to support this degree of reliance and to build trust.”

Nonetheless, many investors seem to feel that it’s still largely “caveat emptor” in the investment industry.

The survey found that 70% of investors “agree that when it comes to investing, every investor has to look out for themselves.” Yet “only 22% are very confident about understanding their rights.”

The FAIR Canada survey was conducted online between June 24 and July 8, 2022, and used a quota system to ensure a 50/50 gender split in the respondents. Online surveys cannot be assigned a margin of error.