Canadian investors sour on discount brokers: study
(Reuters) - Satisfaction among Canadian investors with discount brokerages has "significantly decreased" from a year ago, and lags that of investors in the United States, according to a study released by J.D. Power and Associates on Thursday.
The study, which included responses from 3,358 investors who use discount brokerages in Canada, said that the industry as a whole has failed to keep up with changing market conditions and customer needs.
"Investors are less satisfied because they're seeing less value provided by their firm," Lubo Li, senior director and financial services practice leader at J.D. Power in Canada, said in the release.
Value in the discount brokerage industry is more and more defined by the tools and resources that firms are providing their self-directed investors to make better decisions, Li said.
While firms may offer these tools and resources, they may not be clearly communicating to clients that they are available, he added.
The study also found that Canadian investors' satisfaction with their discount brokers trails their U.S. counterparts.
Overall investor satisfaction with discount brokerage firms in Canada averaged 679 on a 1,000-point scale. A year earlier, it averaged 707 points.
Investor satisfaction in the United States in 2011 averaged 764 points, up 1 point from a year ago.
The main reasons for the declining satisfaction among Canadian investors were in the areas of problem resolution, information resources and account offerings, J.D. Power said. Continued...