The Wealth Consigliere

Good investors are always trying to evaluate investor sentiment.  Most successful investors use sentiment as a contra indicator.  Thanksgiving dinner conversations and Uber drivers are my contra indicators. I spent my Thanksgiving with my family in Dallas. While most of our guests drove themselves to dinner like most good Texans do.  Uber was used by my California based family. This week I share my Thanksgiving and Uber conversations and my conclusions from each. Thanksgiving I have worked in the financial services industry since 1987.  Initially  my family believed my job provided me a crystal ball into the direction of the stock market.  I was flattered when they asked and I provided them the company line on where the market was going.  It made me feel smart but when my opinions were incorrect my family members remembered.  Eventually my Thanksgiving response became that I didn’t know where the market was headed.  The blind love of family members thought their San Francis

The recent Focus Financial earnings conference call identified numerous questions without credible answers.  The market price agreed and now the RIA industry needs to examine what Focus has gotten right and where the firm needs to improve.  Our blog this week will try and answer these questions and also provide a historic perspective of how we  got here. History History does not repeat itself but it does rhyme.  Wealth Advisory firms need to understand who their recruiting targets are and create a program to transition the professionals from their old business model to their new firm’s culture.  Understanding the advisors’ history is an effective place to start.  I have made the mistake of hiring people that shared my history in the brokerage industry.  This approach has failed and I have examined why.  The first place to start is to compare the professional focus of the advisors’ old firm.  What was their compensation plan and what products and services were they traine

November 15 is a big date for hedge fund investors and their managers.  November 15 is the date investors must inform managers that they would like their money back in January.  The October statements could scare clients into making the decision to redeem.  Successful investors warn against making emotional decisions we might eventually regret.  While we might block out past erroneous decisions, a good investor and their experienced advisors can be a good sounding board.  This week we will look at resources that can help us make good decisions on November 15 and beyond. Dalbar Wealth managers often reference the results of the annual Dalbar study .  The poor results that retail investors continue to experience were at first shocking but have now become ‘Meh” . Our advice is to educate your clients on how they can avoid the Dalbar pit.  We have found that establishing an IPS during calm times and reminding our clients the importance of adhering to the IPS commitments whe

Now that the Midterms have finally come and gone, we will have more brain capacity and TV capacity to focus on other issues in our life.  An October 26, 2018 episode of Hidden Brain entitled "Too Little, Too Much" shared some academic research on our limited brain capacity that can guide us.  Freeing up the Midterm capacity will create mental capacity that will allow bloggers and investors the opportunity to focus on issues that impact our financial and emotional lives. This post will address what the wealth management industry can learn from successful midterm strategies without clouding our judgment by requiring we pick a side. We are shocked and appalled by the billions spent on political campaigns.  Let’s examine where the money was spent and examine where the strategies worked. Brand The financial crisis created brand backlash against Wall Street.  This backlash opened the door for independent advisory firms to position themselves as the anti-Wall S