Adviser checklist will make you smarter


Personal Finance Reporter
Saturday, January 15, 2000

There's a Web site you should know about if you're off to see your investment adviser any time soon about mutual funds for your registered retirement savings plan.

It's called Investorism ( and it's one of the humblest investing sites around. Not to worry. All you're interested in is the one-page fund transaction checklist, which you can download in all of about four seconds.

What you'll have when you print the document is a form designed to help you find out everything you need to know about the funds you're buying, and the way your adviser is paid for selling those funds.

The form is the work of Joe Killoran, a one-time broker with Merrill Lynch who now crusades for investor rights while doing a little supply teaching on the side. Mr. Killoran would like the fund industry to adopt his one-page form as a standard practice when selling funds. Read the document and you'll see this is about as likely to happen as cows learning to fly.

The reason is that the form asks advisers who sell funds to answer some very touchy questions.

For example, there's space to fill in all the fees and commissions attached to the sale of the funds you're buying. Most notably, there's a place for the annual trailer fee that the fund company will pay your adviser for selling its products.

The form also has a place to explain the ins and outs of back-end load mutual funds, also known as deferred sales charge funds. If your adviser fills out this section, you'll know what kind of redemption penalty you'll face and how many years you have to hold the fund before the penalty declines to zero.

Another section of the form allows you and your adviser to go over a few key points about mutual funds together, including the fact that funds are not covered by Canada Deposit Insurance Corp., and that fund values are subject to market volatility that can come from a variety of sources.

About the only other things on the Investorism Web site are Mr. Killoran's résumé and a longer version of the checklist. It's not one of the glitzier investing Web sites around, but it will make you a smarter fund investor.
Suggest a Web site by E-mailing