During a recent client review, the performance report indicated that his trailing returns were approximately +22.0% (12 months), -1.20% (three months), and -0.10% (one month). During the same periods, the market returns were +12.0%, -15.0%, and -5.0%, respectively. In short, the client’s portfolio did very well compared to the market. What do you think the client saw? The client saw the two negative numbers and suggested that perhaps the money should be kept in a savings account.
This particular client is a pleasure to work with, but admitted they are unfamiliar with the markets. The moral of this story could read; “Exclude short-term periods,” or, “Make sure the client understands that short-term results are not the focus.”
Sometimes it may not be wise to show them to a client, especially if that particular client assigns undue importance to them.
After all, we live in a society where instant gratification is the norm, fed by television’s sound bites. In the future I will be more cautious about showing short-term results. It’s also important to educate the client on prudent expectations. After some discussion the client understood and now everything is fine.
A New Frontier (At least for me)
Have you ever wanted to host a Webinar, but lacked the knowledge to do so? This was the case with me. However, thanks to Matt with Advisor Portal, I am now equipped to host Webinars. Advisor Portal provides a number of services including Web site design, online document storage, and the aforementioned Webinars.
To conduct a webinar, I simply direct the client to my site, have them log in to their portal, and click the Webinar button. Then, they select the wWbinar link and the rest is academic.