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Enhanced expertise is key to investor satisfaction


Investors prioritise qualitative factors indicative of client-centric service when evaluating their advisors, according to The Investments & Wealth Institute’s (formerly IMCA) latest study, Investments & Wealth Client Research 2017.

The research, fielded by, gathered input from 585 mass-affluent and high-net-worth (HNW) investors across the United States in August 2017. The sample specifically targeted investors with at least USD500,000 in investable assets who work with a financial advisor (across all channels) and make or contribute to financial decision-making in the household.
Eighty per cent of respondents rate ethical standards as a critically important consideration, followed by trustworthiness (80 per cent) and knowledge (77 per cent). On these matters, clients are relatively satisfied, with 75 per cent reporting satisfaction with their advisor’s ethics, 77 per cent with their advisor’s trustworthiness and 73 per cent with their advisor’s knowledgeability.
On more technical, quantifiable measures tied to investment management, however, investors are seeking more from their advisors. Three-quarters say that long-term investment returns are important to them, but only 60 per cent report satisfaction. Other gaps can be found in value relative to fees (67 per cent say it’s important; 53 per cent are satisfied), as well as levels of risk in the investor’s portfolio (77 per cent say it’s important; 67 per cent are satisfied).
When asked what they are paying their advisor to do for them, clients listed investment management (59 per cent), followed by financial planning (46 per cent), wealth management (36 per cent) and retirement solutions (35 per cent). The responses were mirrored when clients were asked to rank the importance of these four types of support/services provided.
“Practitioners who blindly rely on their firm’s model portfolios, outsourced asset allocation or new technologies substituting for their own investment knowledge and competence do so at their own peril,” says Sean Walters, CAE, chief executive officer, Investments & Wealth Institute. “Clients expect expertise at higher levels than ever, and in order to close the satisfaction gap, advisors must identify ways they can bolster their knowledge to drive tangible outcomes.”
“Knowledge is the key that unlocks engagement,” says Julie Littlechild, founder of “The more investors know and understand, the more they can be active participants in their wealth management strategies, have realistic expectations about their portfolio’s performance, and truly collaborate with their advisor to get the best results possible.”
High net worth clients believe in the importance of advanced voluntary standards for their advisors.
One way advisors may be able to close this gap between expectations and results for their clients is the pursuit of advanced education beyond what is legally required. The survey found that mass-affluent and HNW investors look for their advisors to pursue voluntary standards, with 62 per cent of respondents saying it was somewhat (38 per cent) or very (24 per cent) important that their advisor hold these designations. In terms of which aspects of credentialing were of critical importance to investors, three characteristics rose to the top, with respondents rating the following as somewhat or very important: knowing their advisor would lose their credentials if they failed to meet ethical standards (88 per cent); knowing their advisor had met a rigorous set of standards (eg. ethics, experience, education, examinations) to be certified (86 per cent); and knowing their advisor had met ongoing standards (eg. annual continuing education) in order to maintain his/her credentials (86 per cent).
In addition to the value HNW investors place on advanced education and standards, they also want to better understand what these designations entail and how they directly benefit from them. Fifty-four per cent indicate that they would like more information about which designations/credentials their advisor holds, as well as what they mean.
When advisors shared information about their designations with prospective clients, 66 per cent of investors say that it influenced their decision to work together.
The Investments & Wealth Institute is developing a program to help members to communicate with clients through the right messages at the right time and with the right amount of depth. The program draws on in-depth information gathered in this study and will be formally unveiled at the Investments & Wealth Annual Conference–ACE Nashville on 7-10 May, 2018.

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