The top conversations on APViewpoint last week were started by Dan Solin, Michael Falk and Rick Bensignor. They generated thoughtful discussion with wide ranging opinions on: how to confront HNW prospects who choose robos; problems with the American healthcare system; and behavioral finance.
Dan Solin’s How to Confront HNW Prospects Who Choose Robos received three comments this week. APViewpoint members responded to Solin’s recent article on how planners who face losing wealthy clients to robo-advisors can better articulate their value proposition. Advisors agreed with Solin’s recommendation that planners should take immediate steps to reevaluate their fee structure and embrace new technology to become more efficient. Some added that, as competition from robos intensifies, advisors should specifically focus on lowering fees and more efficiently structuring their firms. Members also shared insights about their recent experiences with HNW prospects who were considering robos and noted “how relatively unimportant outperforming the market was to them compared to their need for a comprehensive retirement and estate planning solution provided by people with expertise they trusted.” They agreed that advisors would be well served expanding the services they offer and positioning themselves as specialists.
The recent market commentary U.S. Health Care Needs Major Surgery received three comments from advisors discussing the shortcomings of the American healthcare system and the economic issues it has created. Most advisors agreed “that the system’s costs and benefits are dangerously misaligned,” and highlighted sick care policies and insurance as areas in particular need of reform. Members argued that misaligned incentives are one of the root causes, and pointed to policies in Canada banning ophthalmologists from making glasses as an example of separation that can help control dysfunctional incentives. Advisors also cited administrative inefficiencies and the lack of information available to U.S. consumers about healthcare products as causes for concern. However, in response to this commentary, some claimed that “it is not accurate to state that the U.S. has inferior medical outcomes to other developed countries, or that our healthcare dollars are less efficiently spent than those countries.” They argued that the life expectancy figures cited are not representative of the efficacy of the U.S. healthcare system because they are skewed by the high murder rate, and that although the U.S. spends more on healthcare than other countries, they spend less on social programs that benefit the health of its population.
APViewpoint hosted another well-attended webinar on October 6, Behavioral Finance: Insights for Improving Client Acquisition and Retention. In this presentation, recognized behavioral market strategist Rick Bensignor introduced advisors to the foundations of behavioral finance and discussed ways advisors can incorporate concepts from this field of study into their client interactions. Bensignor explained that behavioral finance looks to combine behavioral and cognitive-psychological theory together with economics and finance, and he introduced some of the biases that influence investor behavior. He argued that recognizing biases that influence decisions during the investment process, such as anchoring and cognitive dissonance, can help advisors deepen their relationships with clients and understand their client’s financial goals. Bensignor will be answering questions about his presentation in this follow up conversation, and a replay of the webinar can be viewed here.
APViewpoint will be hosting its next CE eligible webinar, Broadening the Opportunity Set in Emerging Markets, Tuesday, October 18, at 4:15 pm ET. In this presentation, Calamos Co-Chief Investment Officer Nick Niziolek will explain how advisors can capture the growth potential of emerging market equities while managing volatility. You can register for the upcoming webinar here.
Marianne Brunet is a financial markets analyst with Advisor Perspectives.
