Credo surveyed more than 3,300 investors in an exercise that compared the users of one company’s funds with the users of the other company’s funds.

  • 1,850 users of BMO Mutual Funds; and
  • 1,529 users of Fidelity funds

We asked them a whole host of questions… but one question, in particular,  produced compelling results:

“Which of the following best characterizes how you feel?

1. I am far behind where I expected to be financially.
2. I am behind where I expected to be financially.
3. I am about where I expected to be financially.
4. I am ahead of where I expected to be financially.
5. I am well ahead of where I expected to be financially.

 

Exhibit 1 below shows the high-level results.

Exhibit 1. Comparing How Investors Feel: BMO Mutual Funds vs Fidelity

On first blush, and by reviewing this graphical analysis alone, it may appear that the distributions we found are very similar. Statistical testing, however, shows that they are not.

The fact of the matter is this: investors who elected to invest in Fidelity funds are significantly more likely to feel that they are either ahead or well ahead of their expectations than are investors who elected to have BMO Mutual Funds manage their money.  Further, they are less likely to feel behind or far behind BMO Mutual Fund users.  The probability that the difference between BMO and Fidelity results happened by chance alone is p=0.0001.

Some highlights from the research:

  • BMO Mutual Fund investors were 42% more likely than Fidelity investors to feel far behind their expectations and 17% more likely than Fidelity investors to feel behind their expectations.
  • Fidelity investors were 44% more likely to feel well ahead of their expectations and 21% more likely to feel ahead of their expectations than investors who had opted for BMO Mutual Funds.

This offers compelling evidence that, given the choice of recommending Fidelity funds rather than BMO Mutual Funds, a financial advisor may be serving his clients more appropriately by recommending Fidelity rather than BMO Mutual Funds.

Note: This research was NOT funded by either BMO or Fidelity.  It was conducted independently and objectively by Credo Consulting Inc. without prejudice.

If you have questions about this or other Credo research, your welcome to call us.