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Investors general understanding of investment fees grew as a result of charges and compensation reports required under the second phase of the client relationship model (CRM2), but this isn’t translating into much action, according to a report published Wednesday from the British Columbia Securities Commission (BCSC).

Canadian investors began receiving the fee disclosure reports in January 2017. The BCSC commissioned a study to track investor knowledge and behaviour before and after receiving the new reports. The study only looked at investors who work with an investment advisor.

“Overall, the distribution of how recently investors have talked to their advisors about performance, fees, or buying and selling has not changed much. Investors do not frequently change their advisors, firms or fee arrangements, and they do not do so any more frequently now than they did before the CRM2 report,” the report says.

The lack of action comes despite an apparent improvement in investors understanding of both their own fee situation and fees generally, and despite investors reporting a decrease in their satisfaction with the value that they are receiving for their fees.

Additionally, the study found that when do investors do act, it doesn’t happen quickly.

“For example, among those who said they were very likely to make a change to their fee arrangement, only 5% report doing so within the first four months, while five times as many say they did so later in the year (25%),” the report says. “Again, just 13% of investors who said they were “somewhat likely” to talk to their advisor about fees report doing so within three months, while more than half (51%) say they did in the following eight months.”

The research also found that investors that saw the biggest gain in their knowledge about fees, such as investors with smaller portfolios or less confidence, were also among the least likely to act on their added knowledge.

“While respondents with smaller portfolios saw improvements to their general and specific fee knowledge in greater numbers than those with larger portfolios, they were by far the least likely to have taken any action,” says the report.

“Investors might be learning, but they don’t always seem to know what to do about it,” the report says.

Millennials are the group most likely to act on their improved knowledge, the study found. Male investors between the ages of 18 and 34 were by far the most likely group to report they discussed their fee report with their investment advisor, according to the report, 60% for male millennials, compared to 31% overall. In addition, millennials who did act upon their CRM2 reports were more likely than older generations to change their advisor or firm.

“Millennials, like all investors, have choices when it comes to their investments. This longitudinal study shows that they are using their CRM2 reports to inform those choices,” says Pamela McDonald, director of communications at the BCSC, in a statement.

The BCSC commissioned the four-part longitudinal Investor Readiness for Better Investing study to measure how well B.C. investors understand the fees they pay and how the fee disclosure reports affected investor knowledge, attitudes and behaviour. The study was conducted by Innovative Research Group Inc. from November 2016 to March 2018.