J.D. Power and Associates Reports: Financial Market Turmoil Takes Toll on Canadian Investor Satisfaction, Loyalty and Channel Usage



    TORONTO, June 24 /CNW/ - Poor investment performance in a tumultuous
financial market has caused overall satisfaction among full-service investors
in Canada to decline considerably in 2009 when compared with 2008, according
to the J.D. Power and Associates 2009 Canadian Full Service Investor
Satisfaction Study(SM) released today.
    Now in its fourth year, the study provides benchmarks for investor
satisfaction that allow individual investment institutions in Canada to
evaluate how they compare to competitive firms.
    The study finds that overall investor satisfaction in Canada has declined
to 693 on a 1,000-point scale, marking a drop of nearly 30 points, compared
with 2008. Poor investment performance primarily drives the decline, as
satisfaction with this factor has dropped by 50 points from 2008.
    The rate of switching investment firms has also increased in 2009, with
10 percent of investors indicating they will likely switch firms in the next
12 months, compared with only 6 percent saying the same in 2008. Additionally,
investors are less likely to recommend their investment firm to others, with
only 24 percent of investors indicating they "definitely will" recommend their
primary firm in 2009, compared with 32 percent in 2008.
    "One way to help alleviate the negative market impact is to offer stellar
advice and proactive and timely communication to clients," said Lubo Li,
senior director and financial services practice leader at J.D. Power and
Associates, Toronto. "By offering investors a little soothing touch of support
in these tumultuous times, advisors and investment firms may differentiate
their services from the competition and increase client loyalty."
    The study also finds that investors are increasingly using diverse
channels to receive expert advice from full-service advisors and take
advantage of the lower costs associated with self-directing and trading
online. For instance, only 25 percent of full-service investors had an online
or discount brokerage account in 2008 compared with 36 percent this year.
    "Investors are becoming more sophisticated in understanding the value of
each channel and maximizing their investments by diversifying their portfolio
and trading channels," said Li. "As investment vehicles become more complex,
firms will benefit from providing clients with investment information online
and secure online trading that is cost effective and easy to use. The new
frugality has arrived."
    Additionally, among those full service brokerage firms that are
affiliated with one of the five major banks in Canada, nearly 50 percent of
their investors use an online or discount brokerage.
    "Financial institutions that offer integrated channel options to
investors are better positioned to benefit from this changing trend," said Li.
"This will likely accelerate as the younger generation - which is growing up
with online games, Facebook and smart phones - matures and joins the investor
ranks in the coming years."

    
    2009 Canadian Full Service Investor Award Recipients
    ----------------------------------------------------
    

    Six factors are used to evaluate overall investor satisfaction with
full-service investment firms and financial institutions that offer wealth
management and private banking services: account set-up and offerings; account
statements; convenience; cost; investment advisor; and investment performance.
    Raymond James Ltd. ranks highest among full-service investment firms with
a score of 747 on a 1,000-point scale and performs particularly well in the
advisor; investment performance; account statement; and account set-up and
offerings factors. Edward Jones closely follows Raymond James Ltd. at 742,
performing particularly well in the convenience factor. Dundee Wealth
Management Inc. ranks third overall at 725.
    The 2009 Canadian Full Service Investor Satisfaction Study is based on
responses from 6,183 investors who use investment services with financial
institutions in Canada. The study was fielded in May 2009.

    
    About J.D. Power and Associates
    -------------------------------
    

    Headquartered in Westlake Village, Calif., J.D. Power and Associates is a
global marketing information services company operating in key business
sectors including market research, forecasting, performance improvement, Web
intelligence and customer satisfaction. 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 (NYSE:   MHP) is a leading
global information services provider meeting worldwide needs in the financial
services, education and business information markets through leading brands
such as Standard & Poor's, McGraw-Hill Education, BusinessWeek and J.D. Power
and Associates. The Corporation has more than 280 offices in 40 countries.
Sales in 2008 were $6.4 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

    NOTE: Chart available upon request.





For further information:

For further information: Media Relations Contacts: John Tews, J.D. Power
and Associates, Troy, Mich., (248) 312-4119, john.tews@jdpa.com; Camille
DePutter, Cohn & Wolfe, Toronto, Canada, (647) 259-3276,
camille.deputter@cohnwolfe.ca

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