Vancouver, British Columbia, June 27, 2023 – As a Top 10 Economy, Canada has exhibited a lack of concerted effort to generate awareness around the private investments category, which accounts for a market capitalization double in size compared to the public market in various countries[i]. According to a recent study, a stark majority of Canadians are unfamiliar with private investments, despite Canada’s large institutional involvement and track record of success[ii] in the space.
Findings from a new study of the Canadian population reveals that 60% of Canadians are not very familiar or not at all familiar with private investments. More common with institutional investors like pension funds, private investments may include private lending, private equity such as investing capital into companies that are not publicly traded, and private real estate such as student housing, seniors living facilities, and infrastructure.
Leading research firm IPSOS conducted a cross-sectional study, commissioned by Harbourfront Wealth Management Inc. (“Harbourfront”), surveying the overall attitudes toward private investments and barriers that may impede retail investor success in Canada.
“Most Canadians aren’t very familiar with private investments, which have been a major component of the pension fund toolkit for years,” says Christine Tessier, Chief Investment Officer at Harbourfront. “Corporate-defined benefit plan availability is decreasing. Canadians need a broader toolkit, that includes private investments, to plan for their futures,” she says. “The IPSOS study clearly demonstrates that among Canadians, a quarter feel their financial institution doesn’t give them access to all types of investment products. New technologies, combined with increased oversight, are changing the face of this industry.”
Study findings show that among Canadians, 24% feel their financial institution does not give them access to all types of investment products, and 27% feel they do not have access to every type of investment product they want. In fact, survey results indicate that nearly half (42%) are open to using another financial institution to gain better access to investment products, and 43% are open to using another investment advisor to access investment products.
Private lending has been broadly adopted by institutional investors in Canada. For example, the Ontario Teacher’s Pension Plan (“Ontario Teacher’s”) benefited from private investments within its portfolio, surpassing its benchmark with a reported 4% annual return in 2022[iii]. Increased contributions to private credit are reported in Ontario Teacher’s portfolio, as well as the Canada Pension Plan Investment Board (“CPPIB”), and Public Sector Pension (“PSP”), to name a few.
Having earned a reputation as one of the leading independent wealth firms in Canada through its innovative and strategic offerings, Harbourfront Wealth Management is helping Canadians understand pension-style investing.
“Pension and endowment funds have been investing in private securities for decades,” says Danny Popescu, Chief Executive Officer of Harbourfront. “In 2018, Harbourfront built and launched Canada’s first accessible multi-manager private securities (AMMPS), to make private securities ‘retail friendly.’”
Last year, Harbourfront received a nine-figure equity injection at a $425 million valuation[iv] from US-based middle market private equity firm, Audax Private Equity, reflecting the high caliber of Harbourfront investment products. The firm continues to develop its family of structured pools to provide Canadian accredited investors with access to diversified, multi-manager solutions with a variety of private securities product offerings.
“It’s important for Canadians to gain a better understanding of private securities and how the addition of pension-style investing can help diversify their portfolios, especially during volatile markets,” continues Tessier.
“We’re advocates of empowering Canadians to become more financially independent. Harbourfront’s multi-manager, multi-strategy products are unique within the industry and this new IPSOS study makes it clear that Canadians want more institutional grade quality opportunities—and they’re willing to make the switch to get it,” says Tessier.
About the Study
Findings were obtained from an IPSOS poll conducted in April 2023 on behalf of Harbourfront Wealth Management Inc. For this survey, 2,000 Canadians aged 18+ were interviewed online to gain clarity around how familiar Canadians are with private investments, usage, and attitudes towards investment categories. The objective of this study was to establish a better understanding of the overall outlook Canadians hold in their attitudes and perceptions toward private investments. The results are considered accurate to within +/- 2.5 percentages points, 19 times out of 20.
IPSOS is the third largest market research company in the world, operating in 90 markets and employing over 18,000 people. Our research professionals, analysts and scientists have built unique multi-specialist capabilities that provide powerful insights into the actions, opinions and motivations of citizens, consumers, patients, customers or employees. Our 75 business solutions are based on primary data coming from our surveys, social media monitoring, and qualitative or observational techniques. For more information about IPSOS, please visit: www.ipsos.com.
About Harbourfront Wealth Management
Founded in 2013, the independent wealth management and planning advisory group is headquartered in Vancouver, B.C., and has a rapidly growing network that currently consists of 28 branches across Canada. The Harbourfront Group includes a registered Securities Dealer/Investment Advisory firm servicing established advisors and their high-net-worth clients, an Investment Fund Manager that specializes in managing sub-advised alternative investment funds, and a U.S. SEC Registered Investment Advisory firm. For more information about Harbourfront Wealth Management, please visit: www.harbourfrontwealth.com.
Harbourfront Wealth Management
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