Montreal - In recognition of Financial Literacy Month’s theme “Talk Money”, the Canadian Securities Administrators (CSA) urges Canadians to speak with family members, friends and, when possible, advisors about their financial plans and to do more research. Having open conversations about money and accessing credible resources can increase investors’ financial literacy, help enable them to make good decisions for their financial future, and help them protect themselves and their loved ones from fraud.
New CSA research on hybrid investors indicates that those who were less likely to talk with an advisor about their investments when developing a financial plan were more inclined to engage in higher-risk, speculative behaviour, like frequent trading and investing in high-risk alternative investments, including crypto assets and options.
“As Canadians take a more active role in managing their investments, it is essential they use available tools, knowledge and resources to help them make informed decisions,” said Stan Magidson, CSA Chair and Chair and CEO of the Alberta Securities Commission. “Financial Literacy Month is an opportunity to empower investors with the knowledge to participate in Canada’s capital markets, and that starts with candid conversations around their risk tolerance, financial goals and their sources of information.”
Whether working with a financial advisor, investing independently or a blend of both, the CSA encourages Canadians to consider the following:
- Check before investing. Before investing, investors should check if the online platform or financial institution they are interested in working with is registered by visiting aretheyregistered.ca.
- Use research and tools effectively. Securities regulators have a variety of investor tools that can guide investors through investing basics, like questions you should ask before working with an advisor and how to understand the different types of investments.
- Understand your risk tolerance. Knowing how much risk you’re willing to take is essential to building a sound investment strategy. Every investment carries some level of risk—higher potential returns typically come with higher risk. There is no such thing as a high-return, risk-free investment. Carefully evaluate each opportunity and ensure you fully understand the investment, the associated risks and how it fits within your financial plan.
- Recognize red flags of fraud. Look for any of these red flags when investing. If you spot a red flag, exercise caution before making a decision. The investment may be a scam, or the person or firm offering it may not be registered to do so. Immediately report suspicious activity to your local securities regulator.
- Seek qualified professionals when possible. If you want assistance with building a comprehensive financial plan or reviewing your existing plan, speaking with a registered financial advisor can help you plan effectively and invest suitably.
The CSA, the council of the securities regulators of Canada’s provinces and territories, coordinates and harmonizes regulation for the Canadian capital markets.
For investor inquiries, please contact your local securities regulator.
For media inquiries, please contact:
Ilana Kelemen
Canadian Securities Administrators
media@acvm-csa.ca