How to differentiate your practice through deeper client relationships. The era of the transactional advisor is behind us. But how can you differentiate your practice in a crowded field and insulate it from client attrition?
The Vanguard Advisor's Alpha concept outlines how advisors can add value, or alpha, by providing relationship-oriented services—such as cogent wealth management via financial planning, behavioral coaching, and guidance—as a primary objective of the value proposition
As Vanguardâ€™s Advisor's Alpha research has suggested, for the typical advisor, the path to greater client satisfaction and asset growth should lead to an underappreciated destination—relationship management.
In the paper, The value of advice: Assessing the role of emotions , researchers estimate that the balance of the perceived value of advice—about 60%—is attributed to functional aspects of the advisory relationship, such as portfolio management and financial planning.
For many nonprofessional investors, constructing a well-diversified portfolio is a challenging task. Instruments like mutual funds and exchange-traded funds (ETFs) can help these investors diversify across a particular set of securities and minimize single-stock risk—but investors’ behavioral or cognitive bias or lack of investment literacy can still hinder their efforts to diversify.