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A growing segment of Canadian investors is straddling the line between self-directed investing and professional advice.

According to a new report from the Canadian Securities Administrators (CSA), about one in eight Canadians now manage some investments on their own while maintaining a separate portfolio with a financial advisor - a group the CSA calls“hybrid investors.”

The research, released to mark Investor Education Month, shows that this approach is most common among younger Canadians and those with higher risk tolerance.

“This study provides a compelling portrait of hybrid investors and underscores the importance of having meaningful discussions with your financial advisor,” said Stan Magidson, CSA Chair and CEO of the Alberta Securities Commission, in a statement.

Who are Canada's hybrid investors?

Hybrid investors are disproportionately younger, male and university-educated compared with the broader Canadian investor population. They combine the control and flexibility of DIY investing with the guidance and oversight of a professional advisor, according to the CSA's report.

The CSA's research shows that hybrid investors are generally confident in their dual approach: 68% intend to maintain both self-directed and advisor-managed portfolios, with 93% expressing high certainty in their decision.

This group is also more willing to accept risk. In a 2024 CIRO investor survey referenced by the CSA, 84% of hybrid investors said they were comfortable taking moderate or significant investment risks, compared with just 46% of Canadian investors overall.

The report also highlights how there is no clearly defined pathway that leads to hybrid investing.“Hybrid self-directed investors landed on their current state of affairs through a diverse range of pathways, and future plans are equally diverse,” the CSA notes.

There are no consistent patterns in terms of account balances, product types, or goals, underscoring that each hybrid investor's strategy is highly individualized.

Risk, speculation and advisory engagement

The CSA report found that younger hybrid investors are taking the most risks with the least planning. Many rely on self-made financial plans, or plans that do not integrate both their self-directed and advisor-managed portfolios. According to the report, younger participants cited their youth, long time horizons and smaller portfolios as reasons they feel able to withstand higher risk.

The report also found that speculative investing often appears unintentional. Although many hybrid investors claim to have some form of plan, focus group participants“struggled to articulate clear strategies for why they maintain both types of accounts” or how they coordinate their investments. Survey results also showed that those with self-made plans were most engaged in speculative activity in their DIY accounts.

At the same time, the report emphasizes that advisors remain an untapped source of guidance.

While many hybrid investors report having a close working relationship with their advisor, these relationships can be surface-level, especially among more speculative younger investors. The CSA notes that hybrid investors tend to trust their advisor more than any other source, however, and those who actively work on a financial plan with their advisor are less likely to engage in high-risk speculative behaviour in their self-directed accounts.

What it means for Canadian investors

Hybrid investing offers flexibility and the potential for higher returns, but it also requires careful planning and awareness of risk.

For younger investors especially, combining self-directed accounts with professional guidance can help balance ambition with prudence, reduce exposure to speculative risk and provide safeguards against fraud.

As hybrid investing becomes more common, financial professionals may need to adapt. Providing education tailored to younger investors, encouraging comprehensive financial plans that integrate both DIY and advisor-managed accounts while also maintaining meaningful engagement can help Canadians maximize the benefits of hybrid investing while avoiding the obvious, and not-so-obvious, pitfalls.

“Regardless of the investing method chosen”, said Magidson in the release,“a comprehensive financial plan that encompasses all your investment accounts can empower investors to make informed decisions aligned to their risk tolerance and goals, while avoiding potentially unsuitable or fraudulent investment opportunities.”

This article provides information only and should not be construed as advice. It is provided without warranty of any kind.

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