Outside voices and views for advisers

Oct 30, 2014, 2:42 PM EST

Goldman Sachs' oil forecasting prowess … or lack thereof

By Paul Schatz

The Goldman Sachs Group Inc. is often in the limelight for hiring the best talent on Wall Street, winning the high-profile deals, having close ties to the government and paying enormous compensation. It's also a firm under intense scrutiny and often in the cross hairs.The last time I wrote specifically about one of their market calls was when they “curiously” downgraded the biotech sector in January 2014. This week, Goldman cut its crude oil forecast by $15 a barrel, which, on the surface, should not get much attention. But it did get me thinking. I vividly recall 2008, when oil was soaring and the country was worried about it never ending. At that time, Goldman called for $200 a barrel oil when oil was $125 and had already rallied $40 in under six months. To me, it seemed as though the venerable firm was caught up in the hype and hysteria, and was only inflating the bubble even more.So this morning, I did some research and ... Read full post

Oct 27, 2014, 3:34 PM EST

Concierge services are not just for hotels

By Brad Johnson

A few weeks ago, I made a trip to Palm Beach, Fla., and stayed at the Breakers Hotel. I normally would not write about a hotel stay, but my stay at the Breakers Hotel stood out right from the beginning because they did something unique to make me instantly feel like a VIP.Even better, financial advisers can easily copy the Breakers' “VIP strategy” and use it to grow their own businesses.Before I get into the strategy itself, it's important to know that I travel all over the U.S. — sometimes multiple times a month.Most of my trips are relatively normal. I stay at normal hotels and I get normal service. After a while, the hotels begin to blur together. It's hard to remember any single stay at any single hotel because the experiences are almost always the same.But my stay at the Breakers Hotel was different. Here's why …When I checked in to the hotel and went up to my room, I noticed a personal handwritten note... Read full post

Oct 23, 2014, 3:40 PM EST

Advisers played a role in market sell-off as they turned to risk-averse ETFs

By Nicholas Colas

Who sold at the lows for stock prices last week? And where did they go?We look at one-week and month-to-date money flows for U.S.-listed exchange traded funds/products in an attempt to answer that question. The trail of bread crumbs is growing a bit faint, but here is what we know for sure: Over the past week, investors redeemed $13.7 billion in equity ETFs, with $10.6 billion of that from U.S. stock funds. Over the same week, investors added $5.9 billion to fixed-income funds and a further $589 million in assets to volatility/hedging ETF products.Month-to-date in October, the equities-to-bonds swap is even more obvious: $16.4 billion out of stocks, $14.9 billion into bonds and $725 million into volatility/hedging products. Our bottom line: Overlevered hedge funds probably contributed to the sell off and V-shaped bottom. But so did a lot of plain-vanilla investment advisers and retail accounts.(Related: Equity ETFs declined for 1st... Read full post

Oct 22, 2014, 3:35 PM EST

4 mistakes advisers make with Millennial women

By Mary Beth Storjohann

Working with Millennial clients has become a hot topic within our industry in recent years and months. How to market/not market, how to invest/save, communication preferences, goals and the big question — “Why even bother?” Whether you like it or not, your client's children (and their children) have a growing need for financial advice. If it you're not going to answer their questions, they'll find someone who will. This is particularly true for female Millennials, who are poised to both earn more and take on a greater role in household financial decisions than previous generations.As a Millennial who provides financial planning services to Millennials, I frequently have advisers asking how my service model works — how I can even earn an income if my clients “have no money” — and ultimately how to actually find and engage these clients. There are a variety of tips and resources I'm always happy ... Read full post

Oct 22, 2014, 9:06 AM EST

Lessons learned during my first six months as an adviser

By Stacy J. Caudill

It seems that when things are meant to be, they have a way of working themselves out. Last fall, I was invited to be part of a new program through Raymond James, the Registered Service Associate Team Development Program. It was a privilege to be part of this pilot program, which was developed to encourage sales and service associates to branch out in their careers and develop a path that may lead to a broader role on their team — or even the possibility of transitioning to an adviser role. Six months ago, my path took me over that bridge, and I transitioned to a new role as a financial adviser.(Related: The leap from sales assistant to adviser)While making this transition was something I had considered doing for a while, the timing just never seemed right. This time was different. This time everything lined up. First, I was invited to become a junior partner with the adviser I have assisted for 18 years, which was a huge honor. ... Read full post

Oct 22, 2014, 12:01 AM EST

Why it's still a juggling act for women in financial services

By Maureen Adolf

Last year, I had the luxury of retiring from a 30-year career with a major financial services firm. I was pregnant when I began there; my daughter is 30 years old now. The exciting thing, from my perspective, is that the daughter I was expecting when I started with the firm was expecting her own daughter — my granddaughter — when I retired. There's a certain symmetry in that progression of events.My daughter, granddaughter and I enjoyed a lovely summer because my working daughter was on maternity leave and, for the first time, I had the opportunity to devote more time to something other than work. And then it was over. My daughter went back to work just before Labor Day last year, my granddaughter started day care and I took a position with a law firm in December. Why am I telling you all of this? Because in 30 years, between the time I had my daughter and she had hers, the challenges haven't changed for young professional... Read full post

Oct 21, 2014, 4:57 PM EST

How to successfully engage executive female clients

By Christine Gaze

A recent research report from Bank of America U.S. Trust highlighted the growing prowess of executive women, who might just be the most exciting emerging wealth segment.There is a compelling narrative for financial advisers to consider as women are becoming more educated, more confident in business, earn their own fortunes and take an active role in investment decisions.(Related: Listen to the latest webcast on how advisers can best serve successful female clients.)• Women are more educated than ever before and hold more than 60% of college degrees.• Women are starting businesses at twice the rate of men.• The number of wealthy women in the U.S. is growing twice as fast as men.• 60% of high-net-worth women have earned their own fortunes.• 81% are actively involved in investment decision making and one in three are the primary decision maker with regard to their investments.While it is important not to paint all ... Read full post

Oct 21, 2014, 3:20 PM EST

Are online investors actually panicking at the sight of market volatility?

By Bhargav Shivarthy

Investors were given a dose of adrenaline last week, as global economic fears and the Ebola outbreak created erratic swings in stock prices. But investors may not in fact be panicking, at least from what we can see from the behavior on our own digital investment marketplace at Covestor.A number of people had predicted that online investment companies would be poorly positioned to handle periods of market volatility. At Covestor, we haven't seen that happen. In fact, our client advisers have taken only a few extra phone calls from investors looking to both brace themselves for a prolonged correction, or take advantage of any potential opportunities that have been created in corners of the market that have been pummeled the hardest. In 2009, when Covestor first launched its marketplace of investment strategies, it was at the height of the financial crisis. Back then, given the levels of distress among investors, we as a company made the... Read full post

Oct 21, 2014, 3:03 PM EST

Passive fixed-income strategies? Not in today's environment

By Thomas Hoops

There are many excellent ways to invest in fixed income in the current market environment. Passive strategies are not among them.Investors should seek out experienced professionals who know the global fixed-income markets, can anticipate and act upon the impacts of rate increases and currency fluctuations, can actively manage downside and seize upon opportunities when they arise.Can passive fixed income strategies do this? No. Worse, the limits of fixed-income benchmarks can expose investors to significant downside risk in rising rate environments.Passive equity strategies, particularly for large cap stocks, track easily-understood benchmarks like the S&P 500. Indexed stocks are often weighted by market capitalization and, while they also have their own set of limitations, they are at least economic meritocracies: the companies with the largest weightings have seen their market values rise through profitability and growth, have made... Read full post

Oct 16, 2014, 3:45 PM EST

Running an advisory practice in the age of the robo-adviser

By Charles Sizemore

Here's a novel idea: Advisers might actually need to earn their advisory fees in the years ahead. With the arrival of online financial planning sites like Mint.com and online investing marketplaces like Covestor, a real in-the-flesh adviser has to offer something more than generic, packaged advice if they are to convince a skeptical investing public to pay them.While this might feel threatening to some advisers, it shouldn't. Yes, the rise of the robos commoditizes entry-level financial planning. But it also allows advisers to scale their practices and to focus their energies on higher-valued services. Used correctly, digital adviser platforms can also be used alongside social media and traditional news media as a powerful marketing tool.THE FLATTENING OF AN INDUSTRYThe internet has flattened industry after industry over the past 20 years as technology has eliminated traditional gatekeepers. First, Napster and its successors destroyed... Read full post

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