Financial advisors commonly look for and attempt to offer the “best performing” investment products, in spite of the fact that one of the basic tenets of the industry is “Past performance is not necessarily indicative of future results.” An investment wholesaler (a true master of the profession) at a tier-one mutual fund recently shared an interesting thought:
“Advisors don’t really want the ‘best’ fund; they just want a really good fund that they really understand.”
Your job as an advisor is to match the proper financial strategies, products, and services with clients based upon the client’s financial situation and objectives. A part of this process involves selling. Three critical steps in the process include telling the client:
- The Benefits of a Particular Strategy
- How It Works
- Where it fits
In order to explain these aspects of a recommendation, advisors need to truly understand what they recommend. When selling, you need to give the 30,000-foot view to the client and be prepared to answer questions – any questions. Don’t try to amaze people with your knowledge, but rather provide them with enough information they need to make an intelligent, comfortable buying decision.
Ethical and regulatory guidelines demand that you know your client. Suitability remains a cornerstone issue in the industry. Make sure you truly know the products and services you recommend as well as you know the clients whom you serve.
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