CSA warns limited fraud awareness could leave investors vulnerable
To mark Investor Education Month, the Canadian Securities Administrators (CSA) released its Hybrid DIY Investing: A Research Summary Report, providing the most detailed profile yet of Canadians who combine self-directed investing with professional financial advice.
The report defines “hybrid investors” as individuals who maintain their own investment accounts while also holding a separate portfolio managed by an advisor. According to CSA research, about one in eight Canadians – or 12% – fall into this category.
Stan Magidson, CSA chair and chair and CEO of the Alberta Securities Commission, said the findings highlight the importance of building a unified strategy across all investment accounts. “This study provides a compelling portrait of hybrid investors and underscores the importance of having meaningful discussions with your financial advisor,” Magidson said.
“Regardless of the investing method chosen, it’s clear that a comprehensive financial plan that encompasses all of your investment accounts can empower investors to make informed investment decisions aligned to their risk tolerance and goals, while avoiding potentially unsuitable or fraudulent investment opportunities.”
Younger, higher-risk investors
The study found hybrid investors tend to be younger, more often male, and more likely to hold a university degree compared with the general investor population. They also have a higher tolerance for risk: 84% reported being willing to take on moderate or significant levels of risk, compared to 46% of Canadian investors overall, according to a related 2024 CIRO investor survey.
Most hybrid investors said they intend to keep their dual approach. The CSA reported that 68% plan to remain hybrid investors, and 93% expressed strong confidence in their decision.
Advisor relationships more transactional
While many rely on advisors to provide structure, the research revealed important risks. Younger hybrid investors, especially those aged 18 to 34 who engage less with their advisors, were more likely to pursue speculative trades such as crypto assets and options. Those without a formal financial plan tended to trade more frequently and take on greater risks for the possibility of high returns.
At the same time, hybrid investors with higher risk tolerance demonstrated limited awareness of investment fraud. Fraud-prevention strategies, when mentioned, often relied on informal sources like online searches or community forums, rather than professional advice.
The CSA also observed mixed findings about advisor relationships. While survey responses suggested strong ties with advisors, focus group participants described more transactional, distant connections.
The CSA said the report is intended to help both investors and industry professionals understand this growing segment. The full summary is available on the CSA website.
