FUTURE RETURNS

Quick hits on investor discounts, skepticism and generations.

WE’RE CHEAP…

But know there’s always a price to be paid for discounts. Even the wealthy are finding that out. The Seward & Kissel 2015 New Hedge Fund Study found that 35% of funds using equity-based strategies in 2015 offered tiered management fee discounts in their founders classes, compared to 25% a year ago. The price for that: 88% of such funds only allow investors to make redemptions on a quarterly or less frequent basis compared to 81% in 2014. In addition, 88% of funds implemented some form of lock-up or gate, up three percentage points.

WE’RE SKEPTICAL…

That the fledgling rebound this year on stock markets is sustainable. A quarter of Canadian retail investors — and a third of global investors — believe another financial crisis is likely within the next three years, according to the CFA Institute’s Trust to Loyalty Study: A Global Survey of What Investors Want. Even worse, only half of investors believe their investment firms are prepared to manage through a crisis should one occur. The report also indicated that 81% of Canadian investors still prefer a human advisor to a robo one.

WE’RE AGING…

And growing more comfortable, at least when it comes to getting a mortgage. A D+H Corp. study of 400 Canadian consumers who had completed a mortgage transaction in the past 18 months found that those who are 40-plus felt more positive about obtaining a mortgage than those under 40, as well as after getting it. One in 10 older consumers used negative terms to describe their feelings at the end of the process compared to one in four younger consumers. The older generations were also more likely to stay loyal to their existing banking relationships, more concerned about getting the best rate and more knowledgeable than their younger counterparts.