How to Convince Investors to Avoid Advisors

  • Investing is easy

The last bull market lasted more than ten years, result: many people find it easy to invest and make money.

However, this is false. Although the bull market lasted that long, many voices said that it was going to end in these ten years. And while a professional is able to make the right decisions and stay disciplined, it is less often easy for a self-directed investor.

Remind the potential client that advisors are there to recommend the right actions, in both bull and bear markets.

  • The fear of dishonest advisers

The tabloid press loves to report stories of scams, those featuring bad advisors who have taken advantage of their clients. This type of article can suggest that all advisers are the same and try to deceive their clients.

In fact, in 2020, there were 617,549 registered representatives, according to FINRA figures. That same year, there were 5,472 investor complaints, 246 exclusions and 375 license suspensions. If you add the numbers of people landed and suspended, this is a tenth of 1% of all registered representatives.

  • Consultants are sales people

Many believe that advisors are the order and do not bring added value. They believe that they have a better time doing their “free” transactions online and thus avoid the services of an unnecessary and expensive intermediary.

However, online trading platforms are not run by non-profit institutions that render a charitable service. There are costs associated with using them, as there are with advisors. The fact is that the latter, due to their expertise and experience, can guide investors in the right direction, unlike trading platforms.

  • The advisers laugh at the investors

Some feel that advisors do not have their clients’ best interests at heart. Their friendliness is only intended to ensure that you will return on the next visit.

Except that most advisors want to build a long-term relationship and want clients to achieve their goals. They will therefore try to guide them accordingly.

A few investors have experienced market declines before and never recovered. They are afraid. They want the returns, but fear the risks. The latter distrust advisers, because they think they will go too fast and lose money.

However, advisors are subject to compliance that obliges them to guide their clients according to their risk profile. Investment advice should be in line with their profile. Advisors will ensure that money will be available when needed.

  • The fear of losing control

Currently, the stock market is very volatile and investors fear heavy losses if they are out for even a week. They think advisors are just standing away from the markets and just watching.

Certainly, an adviser avoids hasty movements, especially in periods of falling markets, especially because they do not make transactions without the agreement of their client. However, when an opportunity opens up, they do everything possible to reach their client.

  • The investor needs specialist advice

Some people imagine that counselors specialize in only one type of counseling. They can not imagine that the latter is a “specialist” in stocks and bonds.

In reality, a consultant is a point of contact to access the resources of his company. He can therefore bring to the table almost any skill that the client can imagine.

  • Counselors do not follow

Many investors believe that advisors only focus on finding new clients at the expense of their older clients.

But the financial sector is not like many sectors where you only get paid for new contracts. The latter operates on asset-based pricing. It is therefore in the interest of the council to create a lasting relationship with its clients.

  • The counselors don’t seem to like it

A few investors believe that the advisors are all from the same culture and economic background and therefore do not represent them sufficiently.

But this is false. There is a nice variety of personalities and profiles among the counselors. Just look a little.

Thus, most of the reasons for customer reluctance are wrong. It is therefore interesting to dissect with them to show the reality and what they have to gain from working with you. What are you waiting for?

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