Is Exempt Market Investing Risky?

Typically, the opportunities that we provide offer a higher yield than that of traditional products and, as such, are often thought of being more risky than traditional products. You can’t really answer this question without taking into account how much research and due diligence goes into an offering, whether it is public or private. Any investment has a degree of risk associated with it, especially if you don’t do your homework.

Every issuer (company that needs the funding) that presents Pinnacle Wealth Brokers with an opportunity is researched in depth using a five-point process. Pinnacle Wealth Brokers has the most comprehensive research expertise in the industry with the goal to remove as much risk as possible when it comes to investing in any of the products on their shelf.

An Era of Regulation and Compliance

A short time ago, the industry was not regulated. This made way for some dishonest investors to ruin a viable investment opportunity for other Canadians. The Government of Canada saw that there was some merit to investing in private market as long as the organizations offering investment opportunities were held to a high-degree of compliance and due diligence. The government implemented some laws (National Instrument 31-103) in 2010 to better protect investors from those that were being dishonest or unqualified to deal in the private investment marketplace.

The Compliance Shift in Our Industry

Since 2010, a lot has changed for the better. For instance, exempt market dealers such as Pinnacle Wealth Brokers, need to participate in frequent audits to ensure that every investment product they provide is compliant with regulations set out by the government. More importantly, the changes put the onus on dealers to make sure that individuals representing their products were being compliant. Today, financial representatives can offer private investment products, but they have to be affiliated with one market dealer of their choice.

Conflict of Interest Policies

Every Dealing Representative and employee must avoid any activity, interest, or association which might interfere or appear to interfere with the independent exercise of his/her judgement in the best interests of Pinnacle, its shareholders, clients, and the public. To the extent that Dealing Representative and Staff may be engaged in outside activities, whether for personal profit or not, they must take care that such activities are not, and do not appear to be, in conflict with their duties and responsibilities to Pinnacle.

To obtain a copy of Pinnacle Wealth Broker’s full Conflict of Interest Policies document, contact compliance@pinnaclewealth.ca.


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