/ by Don Connelly / Investing Wisdom / 0 comments
We’ve all encountered them: The prospect or client who wants to go it alone. They want to manage their own portfolio.
Well, here’s one approach you can use:
First, ask the question, “Can I share something with you?” (I like this phrase because it’s non-confrontational. It doesn’t activate the prospect’s ego, leading to an argument you can’t win. It neutralizes it.
Then you can show them the latest DALBAR study.
It doesn’t matter much what year you use. The results for individual DIY investors are almost always dismal: According to the 2019 DALBAR Quantitative Analysis of Investor Behavior, the typical do-it-yourselfer achieved an annual real return of just 1.71%.
Compared with the S&P 500, do-it-yourself investors lagged the S&P 500 by huge margins:
• 4.35 percentage points, annualized, over five years;
• 3.46 percentage points, annualized, over 10 years;
The reason: Bad market timing decisions. People pile into the market at the wrong times, and then they panic and sell at the wrong times.
Why? Because people are irrational, and are hardwired to make sub-optimal decisions.
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Turning Global Economic Trends into Stories That Inspire Action and Build Confidence
/ by Don Connelly / Storytelling, analogies and power phrases / 0 comments
Did you know that by 2050, 70% of the global population will live in urban areas? What does this mean for your clients? Successful advisors go beyond reacting to short-term events such as market volatility and its impact on client portfolios. Instead, they proactively address long-term economic trends that shape their financial futures.
As a financial advisor, you are tasked with helping clients navigate complex and ever-changing economic landscapes. While data and charts are helpful tools, they can sometimes overwhelm or confuse your clients rather than provide clarity. As we have emphasized in past posts, the key to effective communication lies in storytelling, turning global economic trends into compelling narratives to engage, educate, and inspire action.
By framing your financial advice in a broader context of economic trends, you help your clients understand their significance. This allows them to make more informed decisions and reinforces confidence in their financial strategies.
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Reasons Clients Need a Financial Advisor – Overcoming the Do-It-Yourself Objection
/ by Don Connelly / Investing Wisdom / 0 comments
We’ve all encountered them: The prospect or client who wants to go it alone. They want to manage their own portfolio.
Well, here’s one approach you can use:
First, ask the question, “Can I share something with you?” (I like this phrase because it’s non-confrontational. It doesn’t activate the prospect’s ego, leading to an argument you can’t win. It neutralizes it.
Then you can show them the latest DALBAR study.
It doesn’t matter much what year you use. The results for individual DIY investors are almost always dismal: According to the 2019 DALBAR Quantitative Analysis of Investor Behavior, the typical do-it-yourselfer achieved an annual real return of just 1.71%.
Compared with the S&P 500, do-it-yourself investors lagged the S&P 500 by huge margins:
• 4.35 percentage points, annualized, over five years;
• 3.46 percentage points, annualized, over 10 years;
The reason: Bad market timing decisions. People pile into the market at the wrong times, and then they panic and sell at the wrong times.
Why? Because people are irrational, and are hardwired to make sub-optimal decisions.
Read more
A Reminder: The Trend Is Your Friend
/ by Don Connelly / Investing Wisdom / 0 comments
I get asked a lot if I coach Advisors and the answer is “No, I don’t coach. I remind.” Literally. I think teaching is showing someone how to do a job. Coaching them is showing them how to get better. I think you get better by going backwards, by going back to the basics, so let me give you the most basic investing thought I can give you.
Watch the video or read the transcript below to learn the most basic investing thought and why the trend is your friend.
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