How to Keep Clients Happy In A Down Market

Economic downturns can actually be a good thing for investors.  And despite the potential for upset clients, this can actually be a turning point for the financial advisor/wealth manager and client relationship.

The client is forced to stay focused, even during the most nerve-racking time; after all, lots of things don’t grow in a straight line.

That being said, the ups and downs and Bulls and Bears can make anyone’s head spin.

“There are three constants in our business,” said Alex Oxenham of Hilton Capital Management.  “First, there’s the constant of change; then there’s the constant of pressure–to always produce results no matter what the economy is doing.  Finally, there’s the constant of competition. It’s crucial to work with an investor who has the skill and the expertise to navigate the ups and downs.”

Hilton Capital Management is a privately-held investment firm. The firm manages roughly $1.6 billion in balanced and equity strategies, and their client base consists of corporations, public pensions, foundations, financial advisors and individuals.

Strategies To Calm Clients In A Downturn

One of the most important strategies is to build trust. Establish a good relationship and keep the lines of communication open.  Let them know the firm’s interests are aligned with their–integrity, discipline and complete transparency is a must.

  • Prepare the client, the minute they walk through the door. The economic landscape can be great at the time, but downturns can happen fast.

You’ll be able to do this by asking the client if they’re risk-takers, conservative investors or half and half. That way, you can advise them on the best investments for their portfolio, whether they want to go with counter-cyclical stocks (those places, like Dollar Stores, that do extremely well in recessions) or something a little more risky, like speculative investing.

Each time a client makes an investment, they are asking that firm to help them secure their overall personal finance and future plans. The work of financial advisors and wealth managers is one-half art and one-half science. It is a difficult balancing act of being constantly on the move while juggling the financial-equivalent of Faberge eggs, in a tsunami.

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