Hello,
Hopefully my title is as shocking to you as it is frustrating for me. My effort is to understand what more I can do to be confident that I am doing what's best for my clients investment portfolios, and that I am advising them to do what I truly would do if I was in their shoes.
I work for one of the most successful investment firms in the US, and unfortunately do not know much about investing beyond applying the following portfolio construction principles:
- Buy quality investments (my firm filters to a focus list from which I work with client to choose holdings)
- Diversify (My firm identifies all portfolio holdings, which covers some exposure to pretty much every asset type available)
- Control volatility risk through asset allocation (firm provides models based on target return/volatility comfort)
- Take a long term perspective.
In a nutshell, most of my time and energy goes into acquiring clients and coaching them to be organized and intentional about their finances, and to be realistic about rate of return expectations. My clients are often people who otherwise would not participate in the markets, or if they do/did prior to meeting me, I save them from blowing themselves up with stupid decisions.
However, given that investment portfolios are the primary way my service is charged for (% of AUM), I have never been able to put to rest my desire to know more about creating and managing investment portfolios in order to be confident I am able to truly serve my client's best interests. At this point, I feel like I just transfer the entire responsibility of investment selection to the firm I affiliate with, and inevitably let the corresponding spread exist, which I can only assume results in some degree of opportunity cost for my clients portfolios.
What do you think are the most important things I should focus on learning to control for clients, given that I do not have the ability to spend a tremendous amount of time on each individual client's portfolio? I also believe that if I were to understand more about managing investment portfolios, I would know what research and services are truly worthwhile to outsource.
PS - I am still in my twenties so I have a long career ahead of me. I am not afraid of challenges that may take me years to complete as I continue building my client relationships (i.e. obtaining CFA, spending time with portfolio managers, getting a masters in finance, etc.).
Thanks so much in advance for your encouragement and input.
Submitted May 22, 2017 at 06:01PM by jammerdude http://ift.tt/2raIIpW
