How advisors guard against client poaching in a volatile market

Be very, very careful wealth managers. It’s client-poaching season.

Heightened periods of market volatility like the current one certainly spur financial advisors to play defense within client portfolios. Perhaps that means raising cash levels, switching from growth to value stocks, or selling an index option or two. In other words, doing whatever it takes to protect that client from losing their money.   

That said, when such wild market swings take hold, financial advisors also had better protect themselves from losing that client's entire account. Why? Because those same unnerved clients are at their most susceptible to being poached by competitors when the investing environment becomes unbalanced.

No joke. It’s not paranoid to think that your competitors are whispering in your clients’ ears right now, creatively framing their own services and expertise as a soothing alternative when they are at their most vulnerable.

Trust us, they are out there doing exactly that. At least the smart ones are.

How to play defense

When it comes to safeguarding his client base in times of market flux, Jake Schoenfeld, associate at TritonPoint Wealth, believes “open and honest communication” is key. Providing context and a thoughtful narrative is critical, whether it be via phone call or e-mail, and especially when clients see outsized swings on a daily basis, according to Schoenfeld.

“Clients are looking to their advisors for guidance and how everything that is going on truly impacts their portfolio and financial livelihood," Schoenfeld said. "While the headline risk cannot be washed away with words, helping the clients zoom out and see the bigger picture is extremely meaningful and provides a human touchpoint that can differentiate how you operate your practice."

Beyond just communicating, Schoenfeld said leaning into financial planning can be an excellent tool to show how all this volatility can impact their portfolios and lifestyles over the longer term. It is a way to address many of the “what if’s” that come up in conversation when there is so much uncertainty out there.

“For those clients that are living off their portfolios, sitting down and going through their investments, outlining where the liquidity will come from when they need money can put them at ease,” Schoenfeld said.

Along similar lines, Amy Drinkard, partner at Steadmont Advisors, feels the key to retaining clients during volatile markets is "proactive communication." That means reaching out to clients before they are hit with alarming headlines whether through phone calls, webinars, emails, or in-person meetings.

“Turbulent markets offer a unique chance for advisors to stand out. When headlines spark fear and confusion, people look for clarity. It’s not about having all the answers, but about showing up with perspective, empathy, and a plan,” Drinkard said.

Elsewhere, Taylor Hart, president of Steadmont Advisors, believes investors don’t run from advice during market stress; they run to good advice instead. In his view, the advisors who keep clients are the ones who “delivered thoughtful, evidence-based guidance long before the turbulence began.”

Be sticky, pay attention

Chasing after new business can be exciting and financially rewarding, but don’t forget to pay attention to your current clients, warns Schoenfeld.  

“Look to continue to build trust and credibility with them. This can create very sticky relationships and trust during times of market turbulence can be just as important as making the right portfolio management decisions,” Schoenfeld said.

For new advisors, market turbulence can feel intimidating, Drinkard said, but it’s actually a prime time to build trust.

“Don’t shy away from tough conversations. Focus on education - help people understand what’s happening and what they can control. And show up consistently. That presence leaves a lasting impression,” Drinkard said.

Finally, Hart said that when the going gets tough, wealth managers should go focus on their craft.

“Deep market knowledge and experience in downturns are non-negotiable. Define a disciplined philosophy. It must be firm yet flexible, unchanged by short-term noise. Communicate relentlessly. Share that philosophy in good times and bad so people know who you are. Show your game plan," Hart said.

"Clients need to hear not only that you’re unfazed, but exactly how you’ll use volatility to their advantage," Hart said.