| Do you think you need an Investment Advisor? | | | | How Do You Find The Advisor for You? |
| Hold on before youanswer because this is sort | | | | |
| of a trick question. Also, I amdefinitely | | | | Since there are good Investment Advisors and |
| biased because I am an Investment Advisor. | | | | bad ones, how doyou find the former and avoid |
| | | | the latter? Good question, andthere are some |
| Nonetheless, I think I can assist you in | | | | keys. Most large brokerage firms list the |
| looking at this issuein a way that will serve | | | | |
| you. | | | | Investment Advisors they work with and |
| | | | maintain informationabout their past |
| Working with a fair number of investors over | | | | performance. This is not a foolproof |
| the last nearly 20years, I have observed that | | | | resource,though, since they tend to recommend |
| while most are intelligent people,and many | | | | the Investment Advisors whoinvest in their |
| are fairly knowledgeable about the market, | | | | products or clear their business with the |
| they are, asa group, not terribly successful | | | | firm. |
| with their investing. | | | | |
| | | | So if you pursue this avenue, you need to |
| Why should they be? More likely than not they | | | | watch for conflict ofinterest issues. |
| have made theirliving doing something other | | | | |
| than investing, so why would theythink they | | | | You can always subscribe to one of the |
| can do what a professional does better than | | | | numerous databaseservices that include |
| aprofessional? (After all, they go to | | | | information, and sometimes rankings, on |
| professionals for healthcare or for car | | | | |
| repairs when needed!) | | | | Investment Advisors. These services tend to |
| | | | be fairly pricey,though, so they may not be |
| Most investors-even some professionals-tend | | | | your best choice. Another option isto find |
| to be "off" in theirtiming: they buy things | | | | articles (yes, like this one) or free |
| when they are hot, not when they arecold. But | | | | newsletterswritten by Investment Advisors. If |
| for the greatest benefit, it should be the | | | | you find one or several thatmake sense to |
| opposite. | | | | you, check out the IA and see if there's |
| | | | chemistrybetween you. |
| The media doesn't help much when it comes to | | | | |
| this buyingapproach, and let's face it; greed | | | | When checking out advisors, here are some |
| and fear play a large part inmost peoples' | | | | things to keep inmind: |
| investment decisions. | | | | |
| | | | 1. Verify their record -- look over their |
| I truly believe the majority of people would | | | | past performance; 2. |
| be better of (thatis, they would end up with | | | | |
| more money at the end of the day) ifthey used | | | | Consider their system. Will it work in |
| professional money managers to advise them on | | | | different marketenvironments?; 3. As best you |
| theirinvesting. Specifically I am referring | | | | can, check out their operationand 4. See if |
| to Registered Investment | | | | they've had regulatory problems. 5. |
| | | | Equallyimportant as doing your due diligence |
| Advisors with proven track records of | | | | is making sure there isgood communication |
| performance in investingin stocks, bonds, | | | | between you and your advisor and that |
| mutual funds | | | | youtrust this person with your money choices. |
| | | | |
| Let me burst one myth right off the bat: You | | | | Another quick free way to scan through a |
| don't have to be amillionaire to engage the | | | | select database andfind a wide variety of |
| services of a topnotch advisor. Somepeople | | | | candidates is with |
| think you need to start an account with | | | | |
| $50,000 or moreto get a really good advisor. | | | | . I'm registered there myself as anadvisor |
| Well, you may have more choices ifyou're at | | | | and know that the company did a background |
| that level, however you can find very | | | | checkregarding registrations and regulatory |
| successful | | | | issues. |
| | | | |
| Investment Advisors who will accept opening | | | | An important question to ask is the how the |
| accounts for aslittle as $5000. | | | | advisor getscompensated. You want to stay |
| | | | away from commission junkies orsalesmen |
| There are literally thousands of Registered | | | | disguised as advisors. I believe that you |
| Investment Advisorsin the US. Just what do | | | | will get thebest unbiased advice from someone |
| they do-what service do they provideyou? They | | | | who is paid a management feebased on the |
| do the legwork; the research and analysis. | | | | value of the assets that you entrust them |
| Maybe moreimportantly, they keep their | | | | with. |
| primary focus on the markets, andspecifically | | | | |
| on their specialty area like individual | | | | To take it one step further, ask if the |
| stocks,mutual funds, or bonds. | | | | advisor invests his ownmoney in the same |
| | | | methodology that he recommends for |
| Because they spend the bulk of their time and | | | | hisclients. If he doesn't, ask why. If you |
| energyresearching, considering, and | | | | don't like the answer,close your check book |
| analyzing, they naturally have agreater sense | | | | and run as fast as you can. |
| of the market and its movements than those of | | | | |
| uswho don't put this kind of attention into | | | | Choosing an Investment Advisor can yield |
| it. So, with the rightadvisor, you can keep | | | | long-term high profitbenefits. I encourage |
| your focus on what you want-like yourbusiness | | | | you to consider it if you haven't before. |
| or your retirement or whatever-and still get | | | | |
| theinformation you want and need to invest | | | | However, as with any relationship, make sure |
| wisely. | | | | there's a fitbefore you jump into it. |
| | | | |