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AN
ARROW IN YOUR QUIVER
It is vital that you have the right equipment
when you hunt. Whenever you are meeting with prospects or clients
you should be prepared to respond positively when an opportunity
presents itself.
If you operate in some area of the wealth management business,
you are likely to come across an investor who may ask for your
recommendations of money managers that they might use. You
can decline to recommend anyone, give out your short list of
favorite managers, or seek to become more involved by identifying
qualified advisers and providing planning and monitoring services.
The response you make should be well thought out. Declining
to assist a client that needs investment help can provide an
opportunity for a competitor. Casually directing a client to
investment professionals can also have negative consequences.
Given the litigious world we inhabit you should not recommend
anyone unless you have done your due diligence to make sure
each endorsed professional is capable of doing a competent
job. Ideally you should recommend firms that have a documented
record of competitive investment performance. Such records
must now be published based on strict federal rules. Advisers
that cannot offer such performance records should be viewed
skeptically; should you be sued, you will likely be required
to show why you recommended a particular manager.
A number of advisers are hesitant to recommend anyone connected
with investments since the recent bear market, especially if
the expected reward (an appreciative client) does not outweigh
the potential risk – the client blames you for making
an unsatisfactory introduction. To make the risk/reward ratio
more compelling you might consider doing the following:
• Help
the client establish an investment policy statement
that governs the relationship between the manager and
client. This establishes what the client expects so
the manager knows in advance what he or she must do
to maintain the relationship. This establishes the
asset allocation, an excellent way to minimize risk.
• Introduce your clients to managers
that you have pre-qualified. This will add credibility
to your
recommendations and reduce your risks further.
• Periodically monitor what the manager is doing and
report your findings back to the client. These observations
should be made based on your assessment of how well
the manager is conforming to the investment policy
statement. This does not entail giving out investment
advice.
• Suggest switching managers
if the results turn out to be sub par.
• Charge for these services.
If you are going to do the work, you should get paid. |
These activities should bind your client closer to you. It
has been stated that the more services you provide a client
the less likely the client will leave, and the more likely
they will refer others to you.
Are there risks in doing this? Yes, but they can be significantly
reduced by offering the program we are suggesting.
Concord Asset Management has been working with advisers for many
years and can show you how best to both market and implement this
profitable and desired program. In return we would like you to
add us to your short list of recommended advisers.
Here is what we will do for your clients:
1. Help them establish their goals and guidelines.
2. Present a comprehensive portfolio review including
our recommendations how the portfolios can be improved.
3. Provide quarterly statements that help you and
your clients determine if we are in compliance with
the stated goals.
4.
Provide a highly experienced Chartered Financial
Analyst as your clients’ portfolio
manager.
5. Meet periodically with the client to review goals
and progress. We encourage our advisers to be present
at such meetings.
6. Maintain long-term relationships.
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What can this program do for you?
1. Prevents
a competitor from entering your client relationships.
2. Keeps you involved in this
important aspect of your clients’ wealth
management program.
3. Substantially minimizes your risks.
4. Allows you to make additional money whether you
charge an hourly or fixed fee, or participate in
a portion of our management fee.
5. Takes minimal time and energy to do. |
What makes Concord Asset Management uniquely qualified to
assist you in this effort?
Outstanding investment research and management –
Concord Asset Management’s majority owner is Madison
Investment Advisors (Madison, Wis.) that, along with its subsidiaries,
manages approximately $10 billion of discretionary assets for
a fee as of June 30, 2004. Madison provides much of the research
Concord uses to make decisions regarding the management of each
account.
Personal service provided by experienced Chartered Financial
Analysts.
Specialists in separate account management – each
portfolio is managed to achieve specific objectives using individually
owned securities. This permits tax-efficiencies, the inclusion
of low-cost or illiquid holdings, and exclusion of specific investments
if desired.
Both Madison and Concord are privately owned – each
employee has a personal stake in client satisfaction. There
are no conflicts of interest with any broker or investment
banking affiliates.
Our investment process and size allows for greater
agility in getting in and out of investment positions. In today’s
market environment the windows of opportunity open and close
quickly. Our smaller size allows greater flexibility.
We believe our fees are less than one might expect given the
complexity of our work.
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