With equity markets taking investors on a heart-pounding ride over the past month or so, a new course aimed at boosting advisers' psychology skills may be just what the doctor ordered.
The Investment Management Consultants Association will conduct an online behavioral finance certificate program starting late next month that focuses on how to help clients make the right investing decisions, especially when circumstances are making them irrational.
“It's even more important today that advisers know how to provide a calming influence and help clients maintain a long-term perspective,” said Sean Walters, executive director of IMCA.
Some of the top names in the burgeoning field of behavioral finance have recorded presentations for the
20-module course, including Meir Statman, finance professor at Santa Clara University's Leavey School of Business, and Dan Ariely, professor of behavioral economics at Duke University. Financial communications expert
Carl Richards will provide vignettes to summarize key principles.
Course topics range from the role of human behavior in economic markets and biases such as loss aversion to advice on ways to talk with clients during times of personal transition and in other stressful situations. Wonder how an adviser's office space and overall set-up impacts clients? That too will be covered, according to the course outline.
The 15- to 20-hour program is being offered in response to member demand, Mr. Walters said. About 85% of the Denver-based group's members said they would be interested in advanced education in behavioral finance when they were surveyed in early 2015. The price is $695 for members and $895 for non-members. Pre-registration begins Oct. 1.
It turns out that clients themselves acknowledge wanting some hand-holding during times of financial stress.
About 83% of investors said that it's important or critical for their adviser to help them remain calm during market drops, according to an IMCA poll of 1,041 investors earlier this year. About 92% of investors surveyed said it's important that their adviser help them to maintain a long-term investing approach.
(More: "Advisers scramble to head off sticker shock from clients over ugly August account statements")
IMCA introduced its first online course about 18 months ago. Focused on alternative investments, about 500 people have signed up for that program so far, according to the association.
IMCA originally planned to have its online behavioral finance course ready by the summer, but it took longer than expected to bring all the content together, said spokesman Ryan Hoffman. Those who take the course are eligible for up to 20 hours of continuing education credit from IMCA and the Certified Financial Planner Board of Standards Inc.
