"Dear Canada: Your mutual fund fees still stink"

[Opinion - Editorial by Glenn Szlagowski - Financial Adviser aka the "Wealth Adviser"]

Wow! That is some headline. This recent headline from Moneysense magazine is certainly eye-popping but is it accurate?

The Moneysense article is referring to Morningstar's latest research on Canadian mutual fund's internal costs.

Morningstar is a U.S.-based company that sells software, mutual fund database information and other products and services to financial advisers, money managers, pension funds, etc.

Based on my own investigation, Morningstar admitted that their original fee report was indeed, flawed with respect to the Canadian MER (Management Expense Ratio) numbers but chose to release the inaccurate and flawed report to the press without comment or explanation. The press predictably, jumped all over the story. As a result, you will see and will continue to see headlines similar to the above.

There is always a story behind the story. I thought it was highly inappropriate for a respected company to release a report that they knew to be inaccurate beforehand and yet, released it to the press anyway. The press did not do their due diligence or checked their sources and merely parroted what the report said. We'll have to give the financial press a great big "F" for failure for that one.

For every Morningstar report that claims Canadian MERs are uncompetitive, there are other reports and studies that say Canadian MERs are indeed, highly competitive. It is an unending argument that I first blogged about fifteen years ago. Based on Morningstar's less than stellar (pun intended) history of dicey press releases and admitted flawed research, in my view, their conclusions remain suspect.