Managed accounts have experienced rapid growth in the past decade, despite a negative economic climate and a corporate culture humbled by a smattering of recent scandals.
The accounts popularity is largely due to the advisory/consultative relationship, according to the Money Management Institute, Washington.
Jack Sharry, president, The Private Client Group, Phoenix Investment Partners, Hartford, is on the institutes board of governors. He says the advisor/client relationship has likely been key in keeping managed accounts popular with the investing public, despite the challenges imposed by the state of todays stock market.
The institute suggests advisors take a holistic approach to guiding clients whether times are trying or not, Sharry says. This means focusing on a clients entire financial situation rather than the return on a particular fund or stock, he says.
Is the client “appropriately diversified, staying the course, set up from a structural standpoint?”
“Those are the issues that should be addressed,” Sharry says.
When an investor is losing a significant amount of money, an advisor should be flexible, but not reactive, he says. “You want to adjust the plan, and you want to be flexible because life changes, so its important to set a course in an unemotional time, you dont want to react.”
The institute says professionalism and intellect are characteristics the consumer of financial services looks for.
Intellect is luck of the draw, Sharry says, but professionalism is something anyone can display. It includes maintaining contact with ones clients regardless of how well or poorly their portfolios are performing.