2 New Reports

December 02, 2016 | Dian Chaaban


By around January 24th 2017, you are going to find 2 new reports in the mail from your advisor that you haven’t seen before. These reports are a vital piece to the Client Relationship Model II, or simply “CRM2” model – and while you may have already heard or read lots about this regulatory change it in the news, what does it mean, exactly?

Well, I’ll tell you.

Speaking technically, CRM2 is a new set of industry regulations meant to provide you with more details on your investment costs and performance. It was developed by the Canadian Securities Administrators, an organization representing Canada’s investment industry regulators. All investors, including those at RBC DS and other firms, will receive 2 new reports with more detailed information, regardless of where they hold their accounts – and it’s important to note that there is no change to the costs you are paying as a result of CRM2.

Speaking explicitly, this is positive for investors like you because it will provide a very clear view on what you are paying for and it will help you to understand the full value (or not) of the benefits you have been receiving from your advisor and their firm.

Many of you reading this are loyal clients – and it is a pleasure to work hard for you each and every day. A direct result of this hard work, I am confident that you have seen the difference we can make in your world through the strategic planning of your net worth and as such, these reports will be a confirmation of the information we have already been sending you over the years. But to those of you who may be working with someone else, this will be a good time to reflect on what services are included in your fee and if don’t believe you’ve seen any added value, you may consider learning more about my team and a strong firm like RBC Dominion Securities has to offer. Click here to learn more.

I applaud the industry for making transparency a priority across the board. For our existing clients, the new reports present no new information because RBC Dominion Securities has already been delivering most of this information our regular statements. But for some investors in Canada, this will be more information than they are used to receiving and so it may be surprising– please know that I am happy to meet with anyone close to you who may be seeing these numbers for the first time to help clarify their objectives.

Ok, so, what exactly will these 2 reports look like? I’ll show you:

The Cost Report will disclose the costs paid by the client to the firm and other compensation received by the firm in relation to services provided to the client from each account annually. Click here for a sample.

The Performance Report will be an annual performance report and will show an account’s returns over certain time periods. Notably, this report will show “money-weighted” rates of return. This is a different way of calculating investment performance than the “time-weighted” method that is currently used by RBC Dominion Securities and across the industry. Some think of money-weighted as a “personal” rate of return because it factors in the impact of the amount and timing of money you deposit into or take out of your account, whereas time-weighted does not.

You will hear more about CRM2 over the coming year and in regular updates from me. I fully support these initiatives as they reinforce both RBC Dominion Securities’ and my team’s commitment to transparency and full disclosure.

As always, our primary objective is for you to achieve your financial goals, but we also want you to understand the value my team and RBC Dominion Securities can provide you with on that journey; it is with this implied trust and confidence that we work hard for you each and every day. If you have questions about the new reports or CRM2 in general, please do not hesitate to call me any time.

With so much going on and information coming at us from every angle, it's sometimes hard to keep your finger on the pulse of what's happening. In an effort to keep you in-the-know and provide you with some conversation nuggets for the weekend, I've compiled the following hit list to fill your conversation pipeline.

Now you are in-the-know with Word on the Street.