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The Country’s Most Knowledgeable Investor is … A Client of Mine!


The Country’s Most Knowledgeable Investor is … A Client of Mine!

At their most fundamental level, all markets are structured for the transference of risk—from the person who wishes to lay off risk to the person who wishes to take on risk, all with a reasonable payment to the person or organization that facilitates the transfer. The grain farmer sells her anticipated crop at a fixed price in the futures market in order to lock in her margins when she delivers, while the grain price speculator takes the other side of that transaction in the hope of profiting from a speculative trade. So it’s easy for us to know both our investment motives, and the market mechanisms by which we achieve those motives, right?

Well, maybe not. In a recent Brondesbury Group study, a large sample of randomly chosen investors were asked 21 questions that included areas of financial planning, investing risk and return expectations, borrowing, and credit. The average number of correct answers was 11.2 out of 21 questions.

So here’s my question for you: How would your clients fare in such a survey?

Oh and here’s a follow up question, what percentage of your clients’ entire investment activity is with you? I suspect you will agree that there is a connection between the time you invest in building their financial knowledge, and the amount of business they invest with you. Perhaps there’s a third question here too—what percentage of your clients are introducing you to their children?

So when it comes to New Year’s resolutions, do you have new plans to invest in your clients’ financial literacy as well as investing for and with them? This might just be the biggest payoff of 2017—when your clients average 21 correct answers out of 21 questions.

Have an extraordinary New Year!

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