The eight traits and characteristics of successful financial advisers

Jul 9, 2014 @ 4:03 pm

+ Zoom

The following is an excerpt from the new white paper "The eight traits and characteristics of successful financial advisers".

The financial planning and investment management industry has always focused on the quantitative and measurable aspects of providing advice, such as investment performance, interest rate movement, market trends, security analysis and research on reams of hard financial data.

However, what differentiates the industry's truly elite advisers from the merely average ones are oftentimes the more qualitative aspects of their jobs.

+ Zoom

There are the less-heralded skills such as an adviser's ability to relate to clients, tell stories, listen to their needs, bring a high-energy focus – and ultimately, act like true business owners – that have long been the key difference between highly successful advisers and their peers. These behaviors and traits are inherently part of the elite adviser's DNA and can often be the best predictor for career success.

Why is it so important to understand the composition and characteristics of the industry's most successful financial advisers? It's no secret that the majority of assets in the advice industry are controlled by a small number of businesses. The top advisers of any firm routinely generate the majority of revenues. The top advisers enjoy much higher production levels and garner the lion's share of assets – and success tends to breed more success. The top-performing advisory firms, for example, in the 2013 InvestmentNews Staffing & Compensation Study have grown their revenues by more than 20% year-over-year since 2008, nearly twice the rate of the remainder of the industry.

While they achieved these results by providing, presumably, reliable advice and following well-crafted business plans, many of the industry's elite financial advisers have multiple 'X' factors that differentiate their firms from the pack – habits and traits that transcend well-beyond any spreadsheet.

Unfortunately, the qualitative characteristics of successful advisers are often overlooked by the industry and are not at the top of training and professional development agendas. Rather, learning the latest product trends, marketing systems and sales approaches seem to be top of mind for organizations when they try to enhance their adviser force.

In addition, there is often a lack of awareness, even among top advisers, as to what has been the key to their success. According to Social Psychologist Heidi Grant Halvorson's seminal article published in the Harvard Business Review about what makes professionals of any industry successful, “Even brilliant, highly accomplished people are pretty lousy when it comes to understanding why they succeed or fail.”

Thus, the focus of this white paper is to provide advisers with insights into the psyche of the industry's top-performers and understand what drives them and their successful habits.

While many of these traits were not taught, they can be learned. If advisers can adapt their approach and adopt these traits, they also can benefit from the outcomes of top advisers in terms of higher production, faster growth, stronger client relationships and, ultimately, more career enjoyment. It's never to late to begin.

So, what are those key traits?

A review of industry research, interviews with top advisers and a recently conducted survey by InvestmentNews of some of the top-performing advisers identified through their quantitative research has allowed us to define the eight behavioral traits that are consistent in the industry's truly elite advisers.

The Top Advisers:

1. 1. They have a “CEO State of Mind”

According to the first white paper in this series, “A CEO state of mind involves taking a strategic approach to aligning personnel, technology and marketing decisions with clear and reasonable goals to maximize the value of their business.”

What this means on a day-to-day basis, is that even if an adviser is an employee of a larger firm, he or she can bring an owner's mentality to their approach and manage their clients just like it was their own business. Advisers can emulate top advisers by investing in systems, technology and infrastructure to efficiently and accurately deliver advice and create an outstanding client experience.

Top advisers pay attention to critical measures such as revenue per adviser, clients per adviser, AUM per adviser, revenues per staff, profitability per client and other key business metrics – while understanding these trends over time so that they can identify where they need to focus their strategic attention. However, they are not overly obsessed with these metrics and they do not operate with a “MoneyBall” mentality – the most successful advisers understand the importance of these business drivers and never lose focus on their ability to impact the short- and long-term growth of a business.

Download the complete version of "The eight traits and characteristics of successful financial advisers" now.


What do you think?

View comments

Recommended for you

Related stories

Sponsored financial news

Upcoming Event

Apr 30


Retirement Income Summit

Join InvestmentNews at the 12th annual Retirement Income Summit - the industry's premier retirement planning conference.Much has changed - and much remains to be learned. Attend and discuss how the future is full of opportunity for ... Learn more

Featured video


Pershing's Dolly: Lessons in leadership

Women are holding top leadership roles as CEOs of some of the industry’s top firms, but it’s still the exception rather than the norm. Lisa Dolly of Pershing talks about how to balance it all.

Latest news & opinion

Morgan Stanley says recruiting and attrition have slowed down

If wirehouses can successfully reduce their reliance on signing bonuses to recruit brokers, they could increase profits.

Managed accounts look attractive to 401(k) advisers, but how do you measure performance?

The customization that makes them a good investment option presents a benchmarking challenge.

National Holdings' acquisition of broker-dealer WFG Investments and its 200 advisers called off

Under an alternative plan, WFG's advisers will be relocated to three broker-dealers, including one owned by National Holdings.

House committees ready two assaults on DOL fiduciary rule this week

One is a vote on a bill to kill Labor's rule and replace it with a disclosure-based best-interest standard, while the second is legislation to prevent funding for enforcement of the regulation.

Can Buckley run the house that Bogle built?

Maintaining a lead in a low-margin business brings unprecedented challenges for Vanguard's new CEO.


Subscribe and Save 60%

Premium Access
Print + Digital

Learn more
Subscribe to Print