Five Writing Mistakes that Sabotage Your Investment Commentary

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To improve your writing skills, please consider attending Susan’s webinar, "How to Write Investment Commentary People Will Read," on June 23 at 1:00 p.m. Eastern. Participants will walk away with tips for how to:

Generate and refine ideas for commentary that will engage readers
Organize thoughts before writing to write more quickly and effectively
Edit writing, so it’s reader-friendly and appealing

You'll find an overview of the webinar on Susan’s website. Early Bird pricing is available until June 2. There's also a discount when two or more people register from the same firm.

Are you sabotaging your investment commentary with bad writing? You may have wonderful insights into the markets, the mutual funds or ETFs you use or your clients’ best next steps. But if your ideas are poorly written, they won’t win the results that you desire. Clients, prospects and referral sources will turn away if you don’t recognize – and fix – the five mistakes I identify below.

Mistake 1. Unopinionated

If your investment commentary simply says the stock market did this and the bond market did that, nobody will care. They can find that objective information faster and more conveniently in a quick online search, their social-media feed or financial publications.

Readers like commentators who express opinions. Being provocative is good.

For example, Bold, Confident and WRONG: Why You Should Ignore Expert Forecasts was one of the most popular commentaries on Advisor Perspectives in April 2016. The contrast between “Bold, confident” and “WRONG” attracted attention because it boldly states a contrary opinion.

If you think big original thoughts, you have plenty of opinions to share. But those people stand out because they are rare. Some firms with fewer original thoughts stand out because of the deep research and analytical resources they apply to their commentary. This advantage typically goes to the mega-firms or to smaller firms with a narrow but deep focus.

What’s an ordinary investment professional or financial advisor to do? You can share your views on a narrower slice of the markets. There’s always something that the big guys haven’t tackled – or haven’t tackled exactly like you. Perhaps they’ve overlooked an exception to the commonly accepted truths about the markets. Or perhaps they didn’t go far enough in their pronouncements.

You can also sharpen your viewpoint and connect with your audience if you avoid mistakes 2 and 3.

Mistake 2. Irrelevant

People want to know “Why should I care about this?” You lose readers when your investment commentary fails to show how market developments affects them.

One of the quickest ways to show relevance is to say how the markets affect your clients’ portfolios or the relative attractiveness of specific asset classes or investments. Of course, you must abide by compliance guidelines. Don’t guarantee an outcome or omit necessary disclosures.

For example, here’s an excerpt from Mike Lipper’s Blog showing how he accomplishes this in Beware of ‘Risk On’ Enthusiasm:

Since I have let you in my secret, here is what I recommend for your portfolio under the current circumstances: ….

Also, the post includes a disclosure of “shares owned personally.”

One-up commentary sources such as The Wall Street Journal, big brokerage firms and most pundits bombarding the internet. They try to reach all readers. Your advantage is that you can target a narrowly defined audience. Take advantage of your niche. If your sweet spot is retired executives with at least $5 million in investable assets and significant holdings of the stock of their former employers, speak to their concerns. What they care about differs from the concerns of, for example, recent college graduates who are struggling to pay off their student loans. This might mean that you delve into recent developments in private equity, which would not concern the typical millennial investor.

Your knowledge of your clients will distinguish you.

Mistake 3. Bland

Investment commentary can be dry. Bland, generic commentary turns readers off.

On the flip side, commentary with personality attracts readers, even if it doesn’t say anything new and it isn’t tailored to its audience. How can you add personality to your investment commentary? Use the following techniques, which I elaborate on in How to add personality and warmth to your financial writing:

Personal stories
Self-deprecating humor
Distinctive humor
Quotations

Another advantage of commentary with personality is that it’s more memorable. Stories, for example, stick with people longer than facts do. “Telling a story is up to 22 times more memorable than relaying facts and figures alone,” according to Stanford University’s Clayman Institute for Gender Research.[1] Stories are also more likely to be shared with others.

The first paragraph of What Does the Market Know? published by Howard Marks of Oaktree on January 19, 2016 provides an example of commentary with personality:

My buddy Sandy was an airline pilot. When asked to describe his job, he always answers, “hours of boredom punctuated by moments of terror.” The same can be true for investment managers, for whom the last few weeks have been an example of the latter. We’ve seen bad news and prices cascading downward. Investors who thought stocks were priced right 20% ago and oil $70 ago now wonder if they aren’t risky at their new reduced prices.

Will Sandy’s line stick with you? It did with me.

Mistake 4. Longwinded

People are busy. They’re bombarded with email, printed materials and online links. Unless it’s written by a major investment strategist, people won’t tolerate writing if it’s difficult to skim or longwinded.

To combat your readers’ natural tendency to flee, make your writing easy to skim and keep it as short as possible. Here are some techniques that can help:

Introduce your main points quickly. This means including them in your introductory paragraph – or near the top of your longer commentary.

Use powerful headings. Your headings should act as signposts that guide your reader through your commentary. Don’t be cryptic. Share the section’s main message.

Write topic sentences that act as umbrellas over the paragraphs that they start. With powerful headings and topic sentences, you can use my first-sentence check method to figure out whether your piece is easy to skim.

Write short sentences. Average no more than 14 to 22 words per sentence. But don’t be a slave to word count. Sometimes longer sentences are easier to understand.

Mistake 5. Untimely

Commentary that comes out too long after the relevant events will be ignored. Today’s world is eager for the quick hit. If you can’t pump your commentary out quickly, it better be strong in terms of original insights, relevance, personality and readability.

Wondering how you can pump out your commentary more quickly? For quarterly commentary, start writing it before the quarter ends. Most of the time, your main points will hold up with minor tweaks.

Avoid all five mistakes and win!

Don’t write commentaries that are unopinionated, irrelevant, bland, longwinded or untimely.

Avoid all five of the mistakes that I’ve mentioned and you’ll be a rarity among investment commentary writers. Of course, to get the most benefit out of your commentary, you must get in front of your target audience. But that’s a topic for another article.

Susan Weiner, CFA, of InvestmentWriting.com, teaches a webinar on “How to Write Investment Commentary People Will Read” and writes and edits investment commentary for leading investment and wealth management firms. Follow her on the Investment Writing blog, Twitter, LinkedIn and Facebook.

[1] “New online curriculum by Stanford's Clayman Institute for Gender Research gives business, enrichment tips,” accessed at http://news.stanford.edu/news/2013/march/clayman-online-lectures-030713.html on May 2, 2016.

Five Writing Mistakes that Sabotage Your Investment Commentary

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