The first half of 2022 has brought an unprecedented spike in market volatility that has created a challenging environment for many investors⸺as well as financial advisors. Clients are undoubtedly experiencing the impact of market uncertainty, forcing many to reevaluate their investment relationships and actively seek guidance in order to successfully navigate potentially uncharted waters over the coming months. For advisors, these are the times that matter most. Research has shown that the value of an advisor is amplified in periods of high volatility and market distress. There is no doubt that embracing the turbulence, and proactively engaging clients, will have a material impact on client and practice outcomes. So what should advisors be doing now to ensure they are having quality conversations with their clients? It all comes down to having the right data, and the right technology.
The volatile market has brought increased client demands, and the unfortunate possibility of decreased client loyalty, to the forefront for many advisors. Many of today’s advisors, especially industry newbies, haven’t faced market conditions like this before, and likely aren’t equipped to handle the turbulent conditions predicted over the next 12-18 months, or possibly longer.
This begs the question: what can advisors do to help ensure their practices not only survive–but thrive–during these unprecedented times? All the while offering the right amount of guidance to each client on how best to protect precious assets and ensure those assets are aligned to support their unique lifestyle goals. The fact of the matter is that wealth management always has been–and always will be–a relationship business. And that client relationship is more important now than ever before. For forward-focused advisors, this is their time to shine and technology is the key differentiator which can augment that personal relationship–not replace it.
The strong technology foundation advisors must seek is built on better client data. For advisors, better client data means better client insights. And with better client insights, advisors are empowered to have more proactive and impactful client conversations. Ultimately, modern technology must arm advisors with increased visibility into all areas clients may face challenges. This includes a consolidated view of assets, risk, performance, and cash positions – all backed by real-time, trade-ready data. Advisors whose tech stacks rise to the occasion and provide that level of insights will be equipped to handle evolving client needs during these times.
Advisors leveraging technology and client data to their utmost advantage will prevail as we emerge from unsure markets. Advisors with the right technology powered by clean, accurate, aggregated, trade-ready data will discover a trio of benefits including: 1) Being in a position to make the best possible investment decisions tied to long-term client objectives, 2) Minimizing surprises and unforeseen circumstances for clients, and 3) Better managing client expectations during market fluctuations.
As advisors, helping clients achieve positive financial outcomes is what gets us out of bed in the morning. In today’s market, technology is the crux to do just that. Clients working with advisors powered by next-gen technology will also receive several key benefits including less fear of market fluctuations and, most importantly, increased receptiveness to the advice and guidance provided by their advisor which is tailored to their individual needs.