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10 Tips for Coaching Your Clients in the Stock Market

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Related: How 8 Simple Questions Can Reveal Potential Clients

The 2022 Winter Olympics are on TV every day. Worldwide, about 1.92 billion people watch. Sunday was the Super Bowl. Some 36 million U.S. households tuned in. 

People love spectator sports. Has watching the stock market become a spectator sport?

People watch CNBC for business and financial news. CNBC Digital averaged 84.9 million average monthly unique viewers in 2020, according to the network. In business news, it reported 115 million unique viewers in March 2020, up 98% from the previous year. Your client is likely among them. 

Are your clients rejoicing over up days and panicking over down days? That isn’t good for their blood pressure. Are they spectators sitting on the sidelines instead of taking action in their own portfolios? Are they blaming you for the ups and down in the stock market?

Let’s get back to the Olympics. It’s believed that the Olympic Games encourage people to engage in sports and exercise themselves. Does watching the stock market encourage clients to become more active investors? That’s where you come in.

See the gallery for 10 things to keep in mind while “coaching” your clients in the stock market.

1. Remind your clients that athletes have coaches.

Regardless of the sport, professional athletes have at least one person who helps them perfect their skills. They critique them. They insist that they practice. They praise and encourage them. They make sure they are eating properly.

Advisors: You are your client’s coach. They have the raw skill. In this case, it’s money and the ability to earn more and add more to their portfolio. You encourage them to focus their attention on what’s happening in the market right now.

2. Remember that athletes have goals. Investors should, too.

They have studied their sport. They know the numbers achieved by record holders. That’s the number they need to beat. If they are going to compete in Alpine skiing, speedskating or bobsled, they know it’s a timed event.

Advisors: Clients need to be reminded why they are investing, what they are trying to achieve. Like athletes, they should measure their progress.

3. Encourage your clients to leave their comfort zone.

Coaches push athletes to compete with themselves, surpassing their own personal best scores.

Advisors: The stock market can be volatile. Clients might sit watching the financial news, worried about what will happen next. Advisors should be spotting opportunities and making suggestions. Regardless of whether they act or not, when things calm down, clients will remember that  you provided direction. 

4. Encourage your clients to dip into their reserves.

Athletes get tired, but their coaches encourage them to persevere. They tell them not to quit, to dig deep and find that extra energy for the final push toward the finish line.

Advisors: Some clients might think of investing in the stock market like playing poker. They play only with the chips they have on the table. Opportunities come along when investing. Advisors need to encourage clients to “dig deep” and find some extra assets they can commit, especially in volatile times, when a really good opportunity comes along.

5. Encourage your clients to learn from the great ones.

Every sport has athletes that set the records. Some records stand for decades. They are admired. Athletes in the same sport want to be like them, so they study that star performer. Those who are still around try to encourage future stars.

Advisors: There are legends in the investing world. Many are still alive. They often share their investing insights. You encourage your client to follow sage advice, not to follow the fad of the moment.

6. Urge them to make bold moves.

It happens in sports all the time. Athletes see an opportunity during the game. They take it. They don’t overanalyze.

Advisors: In volatile markets, sometimes you see a good stock suddenly selling at a price you haven’t seen that low for a year. You need to encourage your client to pull the trigger. 

7. Do what you can to ensure they don’t get hurt.

Athletes exercise. They push themselves, but they know their limits. During a game they play hard but try to avoid serious injury. They might take risks, but not stupid ones.

Advisors: Sometimes you need to protect clients from themselves. When people are gambling and losing, they sometimes double up their bets or want to go “all in.” Investing isn’t gambling; at least it’s not supposed to be. Advisors need to be the voice of reason.

8. Recognize that you don’t have to be an athlete to enjoy the game.

Instead of playing on the field, some people buy the team instead. They hire good players and coaches, letting them do what they do best. If someone isn’t performing or following the rules, they drop them and hire another to take their place.

Advisors: Some clients are good at stock trading. Some advisors are, too. If your client (or you) doesn’t fit into that category, you can “buy the team” by hiring professional money managers. You let them make the buy and sell decisions, doing what they do best. If they aren’t performing over a reasonable period of time, you drop the manager and replace them. 

9. Stay honest.

It’s tempting for athletes to try to get an edge through performance-enhancing drugs. They often feel they are smarter than everyone else and won’t get caught. If they do, they are often banned from competing. Their career is over.

Advisors: You know your client well. You can detect changes in their behavior, like when they have a great idea and want to sell everything, putting all the money into out of the money stock options close to their expiration date. It smells like insider trading. You need to let your client know they will get caught, especially if the person sharing the tip gives them up.

1. Get paid.

Perhaps it’s an urban legend, but John Madden apparently said: “If you want the coach, you’ve got to pay the coach.” Athletes don’t get their coaching for nothing. Someone pays.

Advisors: Your advice has value. You will be judged by your client on how well you have done. This advice shouldn’t be given away. 

Sometimes clients liken advisors to croupiers in a casino. They are gracious, yet unconcerned if the client wins or loses. Good advisors are more like coaches, experts paid to help clients try to reach goals and perform to their full potential. They must be proactive.


Bryce Sanders is president of Perceptive Business Solutions Inc. He provides HNW client acquisition training for the financial services industry. His book, “Captivating the Wealthy Investor,” is available on Amazon.