Mutual Funds | Should you trust your bank?

When it comes to mutual funds, can you blindly trust your bank’s advice or should you also do your research? The press Weigh the pros and cons.

Posted on April 27th

Emilie Laperriere

Emilie Laperriere
special cooperation

The mechanic is like the financial advisor: as the expert knows his work better than his customers, we tend to listen. Choosing the mutual funds recommended by your financial institution seems much simpler than finding the best solutions.

Without wanting to preach for his parish, the regional vice president of Banque Nationale Investissement also believes that most customers will be well served in the bank. “Advice is super important,” says Martin Felton. The financial advisor will make a budget after looking at where the client is in relation to risk and their financial situation. »

Desjardins financial planner Angela Iermieri agrees. “There are thousands of mutual funds on the market,” she points out.

The recommendations of an advisor are often made according to the profile of the investor of the saver and according to the general view of all the assets that he holds.

Angela Iermieri, financial planner at Desjardins

Essential diversification

Martin Felton, however, puts a caveat: the financial institution must have a good diversification of its funds. “At BNI, we have an open architecture. From the Royal Bank to Goldman Sachs, we sign agreements with the best portfolio managers in the world for different asset classes. I am therefore able to tell our clients that we have the best vehicles d “investment”, explains the man who believes that the reality is not the same in all banks.

Jean-François G. Labbé has more reservations. The financial adviser of Lafond Financial Services believes that it is worth looking elsewhere. “Banks have reduced their services over the years,” he explains. They offer their products in the first place, and these are not always the best in the market. »

Take your time

If you want to invest independently, you have to take the time to learn and train, according to Angela Iermieri. “You need to know. Of course, you can buy securities and mutual funds on brokerage platforms, but then you have to navigate alone, without advice,” they warn. These brokerage platforms however offer analysis and training tools for those who want to try their luck.

Independent financial advisors are also a good option. “An investor will be better served with them,” says Jean-François Labbé.

[Les conseillers indépendants] they have a wider choice of investments and can opt for funds from different institutions. They can therefore further promote the customer’s interest and recommend the products that best meet their needs.

Jean-François G. Labbé, Board Member of Lafond Financial Services

The more adventurous can also turn to publications such as Morningstar or Globefund. “Finding the four or five star funds, they help to find what I call the ‘flavor of the month’ funds. Investors can try to find the best there,” says Martin Felton.

On the other hand, past performance is not necessarily a guarantee of the future. “A fund that did very well last year may not repeat its success in the coming years. You need to dig a little to see what is invested and not just rely on the return,” warns the expert .

In short, as in the garage, it is above all the service that makes the difference.

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