Archive for the ‘Uncategorized’ Category
Wednesday, August 4th, 2010
This article is a guest contribution by Michael Nairne, President, Toronto-based Tacita Capital.
As the stock market rallies, investors can easily lose sight of the real risk that they face – a long-drawn-out period of dismal equity returns. This month’s Commentary investigates the probability of this occurrence over the next twenty years and analyzes the important role of bonds in reducing this risk
For the long-term investor, risk is not about volatility – it is about a long-drawn-out period of dismal stock returns. Investors in U.S. equities are suffering the full brunt of this reality, as evidenced by the following graph that depicts the cumulative value of $1.00 invested in the S&P 500. Investors have endured eleven years of ups and downs to find they are back to where they were in March 1998.
And mind you, this gloomy performance is before the performance drag of costs and taxes. For retirees living on investment returns, the result has been nothing short of catastrophic.
However, the risk of protracted bleak performance has always been a facet of equity investing. The nexus of excessive stock valuations and a massive economic shock that leads to plunging stock prices, monetary instability and subpar growth can result in years of disappointing returns.
This risk becomes apparent when you look at the range of stock values that could arise in the future. The following graph is a simulation of potential values of the S&P 500 over the next 20-years starting with an initial value of 1.00. Based on the average return and volatility of the S&P 500 since 1926, it uses long-term historic experience to extrapolate a range of possible outcomes.
The median outcome as shown in green (i.e. the 50 percentile) is the reason growth-oriented investors emphasize equities in their asset mix — $1.00 invested today could grow to $6.28 in 20 years. On the upside shown in red, there is a 5 percent chance (i.e. the 95th percentile), $1.00 could grow to $25.35 or more. Equity investors in January 1980 actually enjoyed such a rare and fortuitous outcome.
On the downside shown in blue, there is a 5 percent chance that $1.00 could grow to a mere $1.55 or less in twenty years. In this gloomy scenario, stock returns are deeply in the red for seven years and barely turn positive after twelve long years. It is this potential outcome of long-term poor equity returns that must concern investors, particularly retirees, in their portfolio planning.
The antidote to this risk is diversifying into high quality bonds; in particular, bonds backed by “the full faith and credit” (i.e. the full taxing authority) of governments. The following graph depicts the ten-year rolling returns of U.S. intermediate-term government bonds (in green) compared to those of the S&P 500 (in red). It illustrates that there have been lengthy periods in the late 1930’s/early 1940’s and the mid 1970’s/early 1980’s where the ten-year return of government bonds outperformed that of stocks. Most recently, government bonds had a ten-year average annual return of 6.1%, a decided contrast to the –1.7% return of stocks.
There are two reasons that government bonds offer a portfolio downside protection. One is self-evident; government bonds offer a high certitude of future cash payments due to their negligible default risk – taxing authority is a powerful instrument in a wealthy society. The result is a much lower downside, as illustrated in the following graph which depicts a simulation of potential values of intermediate-term government bonds over the next twenty-years based on an index value of 1.00 as of June 2009.
In the reasonable “worst case” scenario depicted in blue (i.e. the 5th percentile), the government bond value turns positive in just over two years and after twenty years has a final wealth index value of $2.07 — significantly higher than stocks at $1.55. The opportunity cost, however, is material — the higher return potential of stocks is entirely foregone.
The second reason is more subtle. On average, government bond returns are not correlated to stock returns — there is no real pattern of co-movement. Bonds will sometimes do well when stocks are doing poorly and vice versa but other times they will perform in unison. However, correlations are not constant and during periods of extreme economic contraction and deflation, the correlation between government bonds and stocks goes deeply negative – government bonds do well and stocks do poorly.
The result is that when government bonds are combined with stocks you get a more diversified portfolio that provides superior downside protection with a reasonable opportunity for growth. This is evidenced in the following graph that depicts a simulation of the potential values of a balanced portfolio comprised of 60 percent stocks and 40 percent intermediate-term bonds over the next 20-years.
In the reasonable “worst case” scenario depicted in blue (i.e. the 5th percentile), the balanced portfolio value suffers only moderate losses initially, turns positive in six years and after twenty years has a final wealth index value of $2.13 — higher than both bonds at $2.03 and stocks at $1.55. Yet, the median outcome results in a twenty-year wealth index value of $4.96, nearly 80 percent of the much riskier stock median value of $6.28, and significantly ahead of the bond median value of $2.84.
In short, in normative markets, the balanced portfolio captures much of the upside of stocks. Only during extreme long-term bull markets like the 1980’s and 1990’s is the opportunity cost of a balanced portfolio high.
In investment jargon, a hedge is a position in one asset that offsets the price risk of another asset. For the long-term investor, government bonds are an essential hedge against a long-drawn-out period of dismal stock returns. The current robust rally should not blind investors to this fundamental reality.
About the author, Michael Nairne
Prior to co-founding Tacita Capital, Michael was the Chief Operating Officer of Loring Ward Inc., a family office located in New York and Los Angeles. Michael was also a co-founder and Vice Chairman of Assante Corporation, Loring Ward’s former parent company, prior to its sale in 2003. During his tenure, Assante grew from $1 billion to over $20 billion in assets under administration.
Michael has written and spoken extensively on wealth management matters, and has co-authored a best seller on fund management. For several years, he chaired the Investment Committee of LWI Financial Inc. which currently manages over $4 billion in assets.
Tacita Capital Inc. (“Tacita”) research has been prepared without regard to the individual financial circumstances and objectives of persons who receive it and is not intended to replace individually tailored investment advice. The asset classes/securities/instruments/strategies discussed may not be suitable for all investors and certain investors may not be eligible to purchase or participate in some or all of them. The appropriateness of a particular investment or strategy will depend on an investor’s individual circumstances and objectives. Tacita recommends that investors independently evaluate particular investments and strategies, and encourages investors to seek the advice of a financial advisor.
Tacita research is prepared for informational purposes. Neither the information nor any opinion expressed constitutes a solicitation by Tacita for the purchase or sale of any securities or financial products. This research is not intended to provide tax, legal, or accounting advice and readers are advised to seek out qualified professionals that provide advice on these issues for their individual circumstances.
Tacita research is based on public information. Tacita makes every effort to use reliable, comprehensive information, but we make no representation that it is accurate or complete. We have no obligation to inform any parties when opinions, estimates or information in Tacita research changes.
All investments involve risk including loss of principal. The value of and income from investments may vary because of changes in interest rates or foreign exchange rates, securities prices or market indexes, operational or financial conditions of companies or other factors. There may be time limitations on the exercise of options or other rights in securities transactions. Past performance is not necessarily a guide to future performance. Estimates of future performance are based on assumptions that may not be realized. Management fees and expenses are associated with investing.
Tags: 95th Percentile, Asset Mix, Brunt, Cumulative Value, Economic Shock, Eleven Years, Initial Value, Investment Returns, Investor Risk, Monetary Instability, Next Twenty Years, Performance Drag, Stock Prices, Stock Returns, Stock Valuations, Stock Values, Term Investor, Ups, Ups And Downs, Volatility
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Wednesday, July 21st, 2010
Many advisors are using the holiday break to reflect on their business.In two columns last fall, I detailed ten lessons from a 2004 trek up Mount Kilimanjaro that might be helpful as advisors think about plans for the year ahead.
Last Monday, I highlighted the first four lessons. Today, I summarize six more takeaways from a trek up Kilimanjaro and complete my “top ten” list.
Last week’s business planning lessons were:
1. Set stretch goals
2. Invest the time to pick the right strategy
3. Put a plan in place that tilts the odds in your favour
4. Pick your partners carefully
This week’s lessons from Kilimanjaro:
5. Ensure you have the right team behind you.
Kilimanjaro: While climbers get the glory, the real heroes are the porters who haul the gear, unacknowledged but instrumental to success.
Advisors: Successful advisors are almost always supported by capable, motivated staff — and investing the time, energy and money to put strong support staff in place is essential.
6. Focus on the immediate step ahead.
Kilimanjaro: When tired, discouraged and faced with tough conditions, climbers need to concentrate on taking the very next step, not the entire journey ahead of them.
Advisors: When daunted by the magnitude of the challenges facing them, advisors need to focus on making the very next meeting or the very next call successful.
7. Focus on the big picture.
Kilimanjaro: If all they do is look at the rocky ground where they’re putting their feet next, climbers miss spectacolour views behind and ahead of them and the motivation this brings. Climbers need to balance focus on the next step with an occasional glance at what’s behind them and ahead of them.
Advisors: To stay motivated, advisors need to take time for an occasional pause to reflect on where you’ve been and the bigger picture — and to reflect on where all the individual steps are taking you.
8. Suck it up when the going gets tough.
Kilimanjaro: Getting to the top of Kilimanjaro inevitably means working through some pain and discomfort along the way — when encountering this, complaining isn’t productive, all you can do is summon up the discipline to stay focused on your goal.
Advisors: Every successful advisor has encountered setbacks, disappointments, frustration and discomfort along the way. To achieve true success, you need the determination and commitment to work through these.
9. Enjoy the moment.
Kilimanjaro: While natural to celebrate when reaching the top of Kilimanjaro, it’s also important to recognize milestones along the way — a tough hill climbed, a hard day behind you. It’s those celebrations that help provide the motivation to work through adversity.
Advisors: Build time into your quarterly, monthly, weekly and daily routine to reflect on and acknowledge the small successes — taking the time to enjoy what you’ve achieved will help provide energy for the path ahead.
10. Begin by beginning.
Kilimanjaro: There are lots of decisions entailed in climbing Kilimanjaro — and it’s easy to get overwhelmed by these. Ultimately, the most important part of the journey is the commitment to start it, to begin by beginning.
Advisors: Some advisors are paralyzed by the many decisions in their business — here too the key is to focus on one decision at a time, make that decision and then move on to the next.
As you reflect on your plans for 2009, consider what lessons from past experiences can guide your business forward and help you reach your full potential.
For those interested in reading the complete articles about lessons from a trek up Kilimanjaro:
Part One: http://www.investmentexecutive.com/client/en/News/DetailNews.asp?Id=46227&cat=30&IdSection=30&PageMem=&nbNews=&IdPub=168
Part Two: http://www.investmentexecutive.com/client/en/News/DetailNews.asp?Id=46656&cat=30&IdSection=30&PageMem=&nbNews=&IdPub=170
For more information, please visit http://www.getkeepclients.com.
Tags: Big Picture, Business Planning, Challenges, Climbers, Favour, Journey, Last Monday, Magnitude, Motivation, Mount Kilimanjaro, Occasional Glance, Odds, Porters, Real Heroes, Stretch Goals, Support Staff, Takeaways, Time Energy, Top Ten List, Trek
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Wednesday, July 21st, 2010
An excellent interview is posted at the Knowledge@Wharton, with three Wharton School professors, who have recently penned a new book on Financial Advisor marketing, aptly titled, “Marketing for Financial Advisors : Build Your Business by Establishing Your Brand, Knowing Your Clients and Creating a Marketing Plan,” by Eric T. Bradlow and Patti Williams, and Keith Niedermeier.
The threesome of professors get into a detailed discussion of how to differentiate yourself from your peers, gain market share during market slumps, and lead unhappy clients away from other advisors.
There is both a transcript and audio of the interview here.
You can listen to the interview feed from K@W here. Click play to listen
Here is an excerpt:
Do difficult times call for retreat or attack?
Keith Niedermeier: Sure. We see the difficult economic times certainly as problematic for advisors, but more as an opportunity. While advisors may be having problems with their clients, certainly the competition is also, which suggests this is the time to understand your customers and your clients better than any other time. It’s an opportunity to lock down the clients you have and to create opportunities to get more clients — dissatisfied clients from other advisors. So, Eric, would you like to add to that?
Eric Bradlow: Yes. One of the things we discuss in the forward of the book, which has gotten a lot of buzz, is whether this is a time to attack or retreat? And one of the things we stress in the book is, as you pointed out, that this is an opportunity to gain ground against other financial advisors. And so we see this as an opportunity to attack.
Choose three words that best describe what your prospects take away from your practice/meetings:
Patti Williams: … One of the most important things that we emphasize in the book is thinking about your business, if you’re a financial advisor, as a brand. A lot of financial advisors are a little bit afraid of marketing, they didn’t get into the business to be marketers. They don’t want to be perceived as taking advantage of their customers through marketing. But a lot of what they’re doing is actually marketing. And we tell them they should think about those three words and really think about the nature of the brand they want to deliver to their customers. What do they want to be? Who do they want to be to their clients? And how can they set up their entire practice around building that image and that capability so that they can truly be what they want to be to their clients.
K@W is an excellent site replete with business resources, research, and analysis.
Source: Knowledge@Wharton, July 22, 2009
Tags: Advis, Amazon, Difficult Times, Dissatisfied Clients, Economic Times, Eric T, Excerpt, Financial Advisors, Gain Market Share, Important Things, Kw, Marketing Plan, Niche, Niedermeier, Patti Williams, Peers, Practice Meetings, Prospects, School Professors, Slumps, Threesome, Unhappy Clients, Upenn, Wharton School
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Wednesday, July 14th, 2010
Recently, I was talking to a successful advisor who met with one of his top clients – and made a mistake that he vowed never to repeat.
In reviewing performance of the client’s portfolio, he said: “Your portfolio was down 15% last year, which was pretty good in the circumstances.”
The client looked at him, paused and said: “It may have been 15% to you, but it was $300,000 to me.”
The advisor recovered and the meeting wrapped up amicably, but this advisor walked away with two resolutions.
First, never again to diminish the amount of money a client loses.
And second, to remember that while we often think about performance in percentages, clients tend to think about their portfolios in dollar terms.
As you think about your conversations with clients over the past while, consider whether you’ve fallen into the same traps of diminishing losses and talking in percentages vs dollars – and whether you too need to be more aware of this going forward.
Tags: Amount Of Money, Circumstances, Conversations With Clients, Dollar Terms, Losses, Met, Mistake, Percentages, Portfolios, Resolutions, Target, Tip Top, Traps
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Wednesday, June 16th, 2010
Since September, much of my time has been spent talking to investors, getting a handle on their sentiment.Of late, many advisors have asked how investors are feeling. Here are the answers to five common questions on how investors are feeling and what they’re doing.Overall mood:
It’s worth noting first that the majority of investors are much less depressed and anxious about markets than advisors — in large measures because they’re having the difficult conversations all day, every day that advisors find themselves in.
Also of note is that what started as market concerns early last fall has changed today to broadbased and more fundamental concerns about the health and direction of the overall economy.
Most investors, especially younger ones under 50, are generally accepting of the downturn — no one’s happy about what’s happened to markets but most take the view they can’t do anything about this at this point except wait for a recovery; there is a stoic acceptance of “we’re all in this together” and a broad playing back of “markets go up and markets go down and always come back.”
The older the investor, the higher the level of anxiety and stress — some investors are starting to pick up on the negative media commentary about the possibility of another depression or a replay of Japan, off 75% from 20 years ago. Note that until recently, some investors were in “statement denial”, where they didn’t open or look at their statements, although year end statements are bringing reality home.
Cashing money out of the market
There’s been a general desensitization towards market moves — a 300 point move is no longer noteworthy for either the media or investors. Few investors appear to have withdrawn their money from the markets (”it’s too late”) but the majority seem to be leaving any new money on the sidelines until they see a market turnaround — this is the same pattern as 2002/2003. Note that there are a small number of investors saying “Is it time to buy yet?”
Confidence in advisors and financial institutions
There has been significant erosion of confidence in and trust towards financial institutions and financial advisors. Some investors are angry at their advisors / firms — in some cases about what’s seen as overselling the ability to predict markets, in others about what investors consider poor advice (”I was told owning bank and life company stocks was safe for conservative investors”) and in some instances because of unrealistic expectations (”Why wasn’t I told to get out? Firms must have known”).
Other investors are upset about lack of contact from their advisor or impersonal communication (”A form letter doesn’t cut it”).
Attitudes to advice from advisors
There is a growing backlash against passive, “buy and hold” strategies and advisors who fail to provide direction– a significant number of investors talk about wanting more proactive advice.
There’s lots of confusion about how the current problems developed, the money that governments are throwing at banks, the auto industry bailout and what this all means …. many investors report that they are getting limited assistance from their advisors in understanding the background to what’s happened to markets and the economy.
A few investors either have changed advisors or have decided to change advisors — but most are going to stick with “the devil they know” for now at least; it may not be great where they are but they’re not going to be move unless they’re confident another advisor will be better. In some cases, investors say that they’re waiting for their investments to come back before making a change. Note that there has been a shift among some investors in both Canada and the United States towards “do it yourself” online brokers — this is a significant difference from what happened after the tech crash.
The bottom line
The market turmoil since last fall has caused many investors to reassess their relationships with advisors. While the level of investor movement from one advisor to another has been relatively minor to this point, market events have created a dramatic opportunity for advisors who are able to demonstrate value and tell their story to prospects in credible fashion.
For more information please visit http://www.getkeepclients.com.
Tags: Denial, Depression, Desensitization, Difficult Conversations, Downturn, Economy, Fundamental Concerns, Investor Sentiment, Investors, Level Of Anxiety, Measures, Media Commentary, New Money, Point Move, Replay, Sidelines, Stress, Turnaround, Year End, Younger Ones
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Tuesday, May 18th, 2010
Given markets over the past year, today should be a great time to be bringing new clients on board — after all, history shows that clients move when they’re unhappy, not when things are going well.
Advisors need to do three things to take advantage of this opportunity:
1. Conviction and confidence
Many advisors tell me they have seen an erosion in confidence around their ability to provide good advice and serve clients well. Being confident in the value you bring is the necessary first step to prospecting success.
Second, you need to carve out the time to focus on prospects, whether it be two hours a week or twenty two. In my conversations with advisors, many say that existing clients consume all their time and there’s no energy left over to focus on prospects. This is sometimes avoidance behaviour, ignoring the reality that almost every advisor will see client defection in the period ahead and that new clients will be needed just to maintain assets at the existing level.
Finally, even advisors who are talking to prospects about providing a second opinion report that the response is often an indifferent one. Even if you bring confidence in your advice and give prospecting priority, you need an approach that responds to today’s investor reality.
That approach has to address the level of skepticism that marks many of today’s investors — they’re not just dubious about their own financial institution and financial advisor, many are skeptical about all financial institutions and all financial advisors. As a result, even investors that aren’t all that happy are often reluctant to move, not sure it would be better elsewhere and taking a “devil you know” view towards making a change.
The result is that with many investors, you have to earn the right to get them to share their statements and give you the opportunity to provide a second opinion.
If you’ve been communicating with prospects regularly over the past couple of years, chances are you’ve earned that right.
And if you’ve built recognition, credibility and visibility in the community a prospect belongs to, this may not be an issue.
But if you’re going at this from a standing start, you will often need to start by building trust.
Here’s how one Chairman’s Club level advisor went about doing this last fall.
In late September, she approached her clients and said: “Given markets over the last while, my team and I are spending a lot of our day staying on top of all the available information on what’s happening. Going forward, I’m going to be selecting one article each week that I think is particularly useful and sending it on Friday afternoon to any clients that are interested in getting this. The sources of that article could be as diverse as The Wall Street Journal, the Economist or a commentary from a leading money manager. Is this something you’d be interested in receiving?”
The response was overwhelming positive — clients were anxious, the sources she talked about were credible and she was sending only one article.
She then approached prospects, explaining that she was sending one article each week to any clients who were interested and would be happy to extend this to that prospect as well. Again, she got a very positive reaction.
Six weeks later, in early November, she began following up with these prospects. She asked them if they had any questions on the most recent article she’d sent and also asked if they’d like to schedule a time in the next two or three weeks to sit down and talk about what was going on in the markets and about their own situation. While not everyone she talked to jumped at the offer, the response was generally very positive — even people who didn’t want to meet right then generally left the door open to talking in early 2009.
Every advisor is different and no approach will work for everyone. Just bear in mind that to capitalize on today’s prospecting opportunity, you need conviction about your value, the right level of priority and a process that is aligned with today’s investor reality. Put those three things in place and you too will see new clients come on board.
For more information about Dan Richards, visit http://www.getkeepclients.com
Tags: Assets, Avoidance Behaviour, Confidence, Conversations, Conviction, Defection, Devil, Erosion, Financial Advisors, Financial Institution, Financial Institutions, Good Advice, Great Time, Level 3, Momentum, Priority, Prospects, Second Opinion, Skepticism, Three Steps
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Thursday, March 18th, 2010
A couple of weeks back, I got a call from an advisor who found himself way behind on contacting clients, felt overwhelmed at the prospect of tackling this and was paralyzed by procrastination as a result.
We all suffer from procrastination — the only difference is the magnitude of the problem.
For advisors looking to overcome procrastination, here’s the three-step solution I suggested to this advisor.Step One:
At the end of each day, identify two things you’ve been procrastinating about.
Each should be something that can be addressed in fifteen minutes or less — a prospect or client to call, email to write or admin problem to resolve.
If the issue can’t be dealt with in fifteen minutes, then carve out a fifteen minute slice to at least start.
Having identified the two issues, write them down on top of your to-do list, in your day-timer or on a piece of paper.
Then carve out 30 minutes in your calendar on the first free spot the next morning — ideally the very first thing in the morning. If you don’t have thirty minutes available, then you’ll need to come in early to get some other things done to free up the time to address this.
Resist the temptation to avoid tackling the two issues. Resolve to deal with them — if you haven’t tackled them by lunch time, then put off going for lunch until you’ve addressed them.
I got a call early this week from this advisor thanking me for my suggestion. He’d put my idea into practice — while he still had clients to call, using this approach he’d begun knocking overdue client calls off his to-do list (and in fact had increased the number of these calls to four a day). As a result, he feels much better coming into the office and his overall productivity and enthusiasm level is a lot higher.
Lots of us are feeling overwhelmed these days. If you can relate to this, consider using the two item a day, three step approach that worked for this advisor.
Tags: 30 Minutes, Address, Advertisement, Calendar Free, Day Timer, Fifteen Minutes, Logjam, Lunch Time, Magnitude, Next Morning, Piece Of Paper, Procrastination, Productivity, Step Approach, Step Solution, Suggestion, Target, Temptation
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Wednesday, March 10th, 2010
This last week has been marked with the continuation of the great melt-up in the markets, with more confirmation coming from the markets in the form of tried and true rules of thumb passing a stamp of approval, such as Dow Theory Letters calling of the bull market. In addition, their has been renewed strength coming from the commodities sector with oil prices creeping still higher, a reason for many Canadian investors to be happy. On the economic front, the Case Shiller Housing Index registered what some are saying is a bottom, and that was taken as very positive news. Whether this is a secular or cyclical “bull,” there are still reasons to believe that we are far from the end of this rally, at least for now.
Here are today’s articles you can send clients. Our selection articles focuses on investing fundamentals, confirmation of the commodities complex play from Nouriel Roubini, and the new values required for “Buy and Hold” Investors.
Investing fundamentals are an important area of focus, as it turns out that often the very best advice is the classical advice, from none other than Benjamin Graham, on how important it is that you pay the right price, the best price for equities and other assets, no matter the conditions of the market.
Pricinples of Value Investing Still Hold True, by Dan Richards, August 4, 2009
At a recent lunch with a group of financial industry insiders, a debate arose over the top investor of all time.
Some of the names put forward were obvious: Warren Buffett, Peter Lynch, John Templeton and George Soros; one contrarian made the case for J.P. Morgan or the Rothschilds. Personally, I was with the contrarian.
But when conversation shifted to the most influential investor, the one person whose beliefs most transformed the investment profession, there was universal agreement on Benjamin Graham, considered the father of value investing, yet a name unknown to the average investor.
Nouriel Roubini, the heralded perma-bear professor, and economist from NYU and RGE Monitor, confirms that commodity prices may rise in 2010:
Roubini says Commodities May Rise in 2010, Rebecca Keenan, Bloomberg
Commodity prices may extend their rally in 2010 as the global recession abates, said Nouriel Roubini, the New York University economist who predicted the financial crisis.
“As the global economy goes toward growth as opposed to a recession, you are going to see further increases in commodity prices especially next year,” Roubini said today at the Diggers and Dealers mining conference in Kalgoorlie, Western Australia. “There is now potentially light at the end of the tunnel.”
FT.com published an excellent article about how “Buy and Hold” investors may have to adjust their mindset to this market, and provides the point of view of several of the markets foremost strategists:
Buy and Hold investors need to learn a new set of values, David Stevenson
“Buy and hold” investing – to capture the long-term outperformance of western equity markets over other asset classes – is now being called into question by a number of leading analysts, who suggest that a new approach to “value investing” will deliver better returns.
In a challenge to the received wisdom of holding stock market investments for 20 years or more, to smooth out short-term volatility, some suggest that measures of cheapness can be used to make buying decisions and enhance performance.
These new approaches have emerged from a series of FT Money interviews with investment strategists, economists and academics – now available as a two-part audio documentary at www.ft.com/moneyshow.
Tags: Benjamin Graham, Canadian Investors, Case Shiller Housing Index, Commodities, Confirmation, Continuation, Dow Theory Letters, Economic Front, George Soros, Industry Insiders, J P Morgan, John Templeton, New Values, Nouriel Roubini, Oil Prices, Perma, Peter Lynch, Positive News, Rally, Rothschilds, Rules Of Thumb, Stamp Of Approval, Universal Agreement, Warren Buffett
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Wednesday, February 3rd, 2010
This week I began a series of half day workshops addressing opportunities for advisors in the current investor mindset.In those workshops, I tackle the number one problem for most advisors attending training sessions — translating the ideas they get into action. I also outline some simple strategies to put new strategies in place — including the single most successful approach I’ve come across to make change happen.Note that there is seldom a problem getting enough good ideas — rather the typical issue relates to getting too many. As a result, advisors walk away filled with good intentions — but do nothing.
So here’s an idea to implement change in your practice.
Start by writing down all the things you’d like to do this year to move your business forward — perhaps set some time aside to discuss this with your team.
Having done that, pick the one idea that would have the biggest impact on your business — and set the rest aside.
In the next 90 days, resolve to focus in a single minded fashion on putting that change in place. Discuss this change with your team, establish weekly goals for what you’re going to do to move this forward, set aside time in your calendar every week to work on that change and monitor progress into your daily and weekly progress review.
Changes are that at the end of 90 days you will have built good momentum on putting that change in place. …. at which point you pick a second area to work on.
By focusing on one change to your business at a time and setting aside focused time to make that change happen, you dramatically increase the odds of translating good intentions into reality.
And over time, you increase the chances of tapping the real potential of your business.