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July 29, 2009 at 08:00 PM
The relationship between investors and their financial advisors becomes the most crucial factor impacting investor satisfaction during times of economic uncertainty, according to the recent J.D. Power and Associates 2009 U.S. Full Service Investor Satisfaction Study.
The study finds that the financial advisor is the most important aspect of overall investor satisfaction, comprising 30 percent in 2009 — an increase from 22 percent in 2008. In contrast, investment performance declines in importance –accounting for only 15 percent of overall satisfaction, compared with 24 percent in 2008.
Edward Jones ranks highest in investor satisfaction with a score of 784 on a 1,000-point scale, performing particularly well in convenience and account statements. LPL Financial Services follows in the rankings with a score of 773, performing well in the financial advisor factor. Charles Schwab & Co. ranks third with 771.
“As investors become increasingly uneasy amid current market conditions, they’re more often looking to their financial advisors for reassurance and guidance,” says David Lo, director of investment services at J.D. Power and Associates. “As investment performance tends to be a relative and subjective measure, it’s more important that the financial advisor manages investors’ expectations of investment performance.”
