About 87% of current investors and nearly 67% of aspiring investors feel it's important that investment advice come from a regulated firm or individual, according to a survey by the Investment Industry Regulatory Organization of Canada (IIROC).

The survey, conducted by IIROC, along with The Strategic Counsel, also found that more than three quarters of current investors are confident Canada's investment industry is properly regulated while less than half of aspiring investors are confident.

Some believe online advice has fewer regulatory protections

But close to one-third of current investors and 44% of aspiring investors believe that online advice provides fewer regulatory protections than advice received from a person. Seniors are least likely to use an automated online investment tool or service for information or advice and they too are more likely to believe that online advice has fewer regulatory protections than advice given in person, according to the survey.

Under IIROC rules, online investment advice models have the same level of regulation as full service, in-person advice models. For example, an online advisor is subject to the same Know Your Client (KYC) and suitability obligations as a traditional face-to-face advisor.

When it comes to discount brokerages, investors make their own decisions

In the case of discount or direct brokerages investors are responsible for making their own buy or sell decisions without receiving any advice from an advisor or firm. For this kind of platform, the regulatory regime differs because this business model does not require KYC or suitability obligations.

IIROC said it’s important for investors to understand the type of account/relationship they have in place and the regulatory protections available, whether working with an advisor (in person or online) or making self-directed trades/transactions.