Improving the Adviser-Client Relationship, Part 2

Successful investment advisers need to be world class at both investing and getting their clients to act upon the investment advice that is dispensed. In December the authors discussed some insights of behavioral finance that pertain to establishing the adviser-client relationship and profiling the...

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Bibliographic Details
Published in:Journal of Financial Planning 2010-03, Vol.23 (3), p.36
Main Authors: Olson, Bryan, Riepe, Mark W
Format: Article
Language:English
Subjects:
Behavioral economics
Client relationships
Investment advisors
Series & special reports
Online Access:Get full text
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Summary:Successful investment advisers need to be world class at both investing and getting their clients to act upon the investment advice that is dispensed. In December the authors discussed some insights of behavioral finance that pertain to establishing the adviser-client relationship and profiling the client. They describe some key findings from behavioral finance that pertain to making recommendations to clients and make suggestions for advisers about how to incorporate these findings into their practice. Many advisers make a mistake at this phase of the relationship because they approach it as purely a technical problem of making the best recommendations possible. Achieving that goal requires that the recommendations be expert, but also take into account the likelihood of being enacted. These recommendations include: 1. Obtain client buy-in. 2. Understand the client's past investment experiences. 3. Understand the ownership history of the client's existing investments. 4. Do not assume the clients' versions of their history are accurate.
ISSN:1040-3981