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By Matt Oechsli
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Charlotte: “Get this,” said one of the
participants from our recent affluent focus group. “I met with my
accountant over the holidays to go over year-end details and then
stopped by my advisor’s office to drop off a sizable check—he was
off for the week. Granted, it was the week between Christmas and New
Year’s, but I waited nearly 15 minutes watching the poor receptionist
field call after call, trying to get my advisor’s assistant between
calls, to no avail. And finally I left. Not pleased.”
There are a number of issues in play regarding this affluent client’s
rant. She called me to share this as a post-script to our focus group,
but she was really looking for my advice. Her questions ran the gamut:
Was this the norm? Should I have gotten better attention? Were only a
handful of assistants and the poor receptionist the only people working
that week? What level of service should I expect? How do I go about
finding an advisor who is more attentive?
Ouch! This advisor has some explaining and relationship repair work to
do. That’s if he’s even aware of the problem (I did recommend that
she contact her advisor,
explain her frustration, and give him a chance.) But most disgruntled
affluent clients will express their displeasure by using their feet.
They walk. It might take some time to make a move, as indicated by this
affluent investor, because it’s not easy for the consumer to separate
top-quality advisors from the rest.
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So you're unhappy at your current firm. But how unhappy?
Quantifying the pain can be difficult, but it’s essential if you're
actually considering doing something about it. That’s because leaving
can be painful, too. Here’s a starting point. The following is a list
of some of the pain points advisors who want to leave their firm often
describe to me. Do any of these sound familiar?
* Limitations on choice: product, technology, type of business.
* Pressure from clients to change firms.
* Tarnished firm brand name.
* Fear that wealth management division will be spun off.
Of course, an advisor’s interest in moving may be less about
frustration with the current firm, and more about the appeal of an
outside opportunity—specifically one that allows him to grow his
business faster and serve his clients better.
Read More Here >>
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LPL Investment Holdings stands to take advantage of growth
in the independent retail brokerage sector in the next three to five
years, as the only publicly-traded company in this sphere, wrote Brad
Hintz, senior analyst at BernsteinResearch, in a Dec. 28 research
report. Still, he believes the company faces some hurdles on the road to
long-term double-digit earnings growth.
Hintz gave LPL a market-perform rating and set a $38 six-month price
target based on a 12-month earnings per share target of $1.71. As of
Dec. 30, LPLA was trading at $35.38.
“Bernstein believes that the massive operating leverage of LPL’s
technology based business model is the principal reason for investing in
this stock,” said Hintz, in the report. “There is a substantial
amount of operating leverage due to the high fixed cost base, technology
and its nationwide infrastructure and even more so in a technology
driven platform such as LPL or Charles Schwab.” Bernstein expects the
margins of the company to expand by at least 20 percent in the next
year.
Read More Here >>
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The ultra-wealthy are still pretty risk averse, according
to a recent survey by the Institute for Private Investors, a membership
organization for ultra-high-net worth individuals and families. But they
may begin increasing allocations to global emerging markets and reducing
cash in 2011.
The December survey of 72 IPI members, who have a mean net worth of $100
million, revealed that they believe their own portfolios underperformed
the S&P 500’s 15 percent return for the year by about a third. But the
funny thing is, they weren’t upset about it, said IPI president Kristi
Kuechler.
“I heard over and over again that members were fine with reduced risk
and giving up returns,” Kuechler said. “They wanted to feel like
they were more in control of their investments and were reducing their
expectations.”
Read More Here >>
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If you would like a FREE copy of our seven-page 12 Ways
to Strengthen Affluent Loyalty PDF visit our download Center.
Enjoy!
Also, if you haven’t already - join The
Oechsli Institute’s Group on LinkedIn!
Once again, we want to thank all of you who have e-mailed
comments and questions to us. We will continue to do our best to answer
each one.
If you have any topic suggestions or special requests, please contact
Rich Santos, publisher of Registered Rep. and Trusts &
Estates magazines, at rich.santos@penton.com.
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