Discount Brokerage Investors in Canada Perceive Less Value from Their Firm, Leading to Declining Satisfaction that Trails Their Counterparts in the United States, J.D. Power and Associates Reports

Disnat Ranks Highest in Investor Satisfaction among Discount Brokerage Firms in Canada For a Third Consecutive Year

TORONTO, Sept. 22, 2011 /CNW/ - Investor satisfaction with Canadian discount brokerage firms has significantly decreased from 2010 and trails other financial services sectors in Canada, according to the J.D. Power and Associates 2011 Canadian Discount Brokerage Investor Satisfaction StudySM released today.

Overall investor satisfaction with discount brokerage firms in Canada averages 679 on a 1,000-point scale in 2011, a decline of 28 points from 707 in 2010. The largest declines in satisfaction are in the problem resolution, information resources and account offerings factors. In comparison, investor satisfaction in the United States in 2011 averages 764—an increase of one point from 2010—according to the J.D. Power and Associates 2011 U.S. Self-Directed Investor Study.SM

The study finds that performance on some of the key best practices in Canada trails those in the United States.

Proportion of Investors Whose Firm Met Key Best Practices

  U.S. Investors Canadian Investors
Contacted about products/services/seminars twice in the past 12 months 38% 24%
Website never inaccessible in the past 12 months 81% 55%
Aware of and use asset allocation tool 28% 21%
Aware of and use at least one financial planning tool 29% 20%

"As market conditions and customer needs continue to evolve, value is defined more and more by the tools and resources that investment firms are providing their self-directed investors to make better investment decisions, and the Canadian discount brokerage industry as a whole has not kept pace," said Lubo Li, senior director and financial services practice leader at J.D. Power and Associates in Canada. "Investors are less satisfied because they're seeing less value provided by their firm—which may not be a matter of providing products for investors, but ensuring through proactive communication that they are aware of all the tools and resources their firm has available."

Investor satisfaction with discount brokerage firms ranks lowest among the three financial service sectors in Canada in 2011, with overall satisfaction among full-service investors averaging 733 and 756 among retail bank customers. The only satisfaction score to considerably decrease from 2010 in all three sectors is for discount brokerage firms, by 28 points, while full-service investor satisfaction decreases by just two points. Conversely, retail banking satisfaction increases by 26 points.

"All major banks in Canada have their own direct investing for the discount brokerage channel, and their customers' expectations are shaped by the rapidly improving branch experience, online banking and advisory services they receive at their primary banks," said Li. "By not delivering a superior experience at the same level as their parent banks, discount brokerage firms not only fail to meet their line-of-business mission, but also run the risk of detracting the value of their parent brands."

The study, now in its third year, examines investor satisfaction with their primary discount brokerage firm by measuring six key factors. In order of importance, they are: interaction; trading charges and fees; account information/statements; account offerings; information resources; and problem resolution.

Disnat ranks highest in discount brokerage investor satisfaction for a third consecutive year with a score of 729. Disnat performs particularly well in account information and information resources. National Bank Direct Brokerage follows in the rankings with 724, while Qtrade ranks third with 709.

The 2011 Canadian Discount Brokerage Investor Satisfaction Study includes responses from 3,358 investors who use investment services with discount brokerage firms in Canada. The study was fielded from May to June 2011.

About J.D. Power and Associates
Headquartered in Westlake Village, Calif., J.D. Power and Associates is a global marketing information services company providing forecasting, performance improvement, social media and customer satisfaction insights and solutions. The company's quality and satisfaction measurements are based on responses from millions of consumers annually. For more information on car reviews and ratings, car insurance, health insurance, cell phone ratings, and more, please visit JDPower.com. J.D. Power and Associates is a business unit of The McGraw-Hill Companies.

About The McGraw-Hill Companies
Founded in 1888, The McGraw-Hill Companies is a leading global financial information and education company that helps professionals and students succeed in the Knowledge Economy. With leading brands including Standard & Poor's, McGraw-Hill Education, Platts energy information services and J.D. Power and Associates, the Corporation has approximately 21,000 employees with more than 280 offices in 40 countries. Sales in 2010 were $6.2 billion. Additional information is available at http://www.mcgraw-hill.com.

No advertising or other promotional use can be made of the information in this release without the express prior written consent of J.D. Power and Associates. www.jdpower.com/corporate

SOURCE J.D. Power and Associates

For further information:

Media Relations Contacts:
Gal Wilder; Cohn & Wolfe; Toronto, Canada; (647) 259-3261; gal.wilder@cohnwolfe.ca
Beth Daniher; Cohn & Wolfe; Toronto, Canada; (647) 259-3279; beth.daniher@cohnwolfe.ca
John Tews; J.D. Power and Associates; Troy, Mich.; (248) 312-4119; media.relations@jdpa.com

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