Peak Investment Services, Montreal-based Peak Financial Group’s mutual fund dealer arm, has found a solution that allows mutual fund sales representatives to offer their clients ETFs.
Leveraging Peak Financial Group’s 15-year securities trading experience, as well as its technology and operations expertise, the firm has developed an in-house platform that enables mutual fund advisors to place ETF trades directly through Peak Investment Services.
“We have an IIROC division and already do a lot of the work in-house when it comes to tools and systems,” says Robert Frances, chairman and CEO of Peak Financial Group. “We’ve been able to take what we do on that side and bring it over to the mutual fund dealer side, and vice versa. Everything is happening under one roof.”
Peak Investment Services joins Mandeville Wealth Services of Burlington, Ont., in being among the first mutual fund dealers to provide mutual fund advisors with products typically accessible only through securities dealers.
Mutual fund reps at Mandeville have been able to include ETFs in client portfolios since 2014 as a result of trading, settlement and custodial arrangements with Broadridge Financial Solutions Inc. and Fidelity Clearing Canada ULC of Toronto.
As ETFs have grown in popularity, Peak advisors have been seeing more interest on the part of clients, Frances says. Thus, the firm plans to offer a variety of ETFs from top providers, including banks and investment fund firms. However, leveraged ETFs that employ derivatives will not be on the offering list, says.
Frances considers ETFs as being particularly suitable for fee-based accounts, but says mutual funds will continue to be important.
“Our advisors are happy to offer ETFs as they would like to have as many options as possible available to the client,” he says. “ETFs are low cost and are a great tool, particularly for small clients.”
ETFs are particularly useful for clients who want to take a passive approach to portfolio management, and they can also be slotted into automated programs that offer basic asset allocation and automatic rebalancing, Frances says. However, he believes that personalized advice is a crucial component of advisor service and in this area “the human part cannot be replaced.”
“We believe that providing advisors with an extensive offering of investment opportunities will contribute to create successful financial strategies for clients,” says Frances in a statement. “It is crucial for advisors to be well-equipped to better serve their clients and overcome the challenges of a changing and highly competitive industry.”
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