The following post is courtesy of Diane Harrison who is principal and owner of Panegyric Marketing, a strategic marketing communications firm founded in 2002 specializing in alternative assets.
November is a reset month in many respects, with year-end planning and level setting of prior expectations. In an election year in the US, these activities are even more important, as the anticipated changes to come in the following year can be greatly impacted by the election outcomes. With the US economy such a major driver of international economic relationships, it seems that the world itself is waiting to see how we shape ourselves for 2027 and beyond.
Elections carry more than just outcomes- they can be highly emotionally charged. How are financial professionals expected to manage not just the monies they invest, but their clients’ and prospects’ feelings about where and how their funds are deployed? Some suggestions for defusing the emotional aspects of investing for those responsible for selling investment funds at this time follow.
REINFORCE THE BASICS. By this I mean, remind people of why they invest in general- to diversify their holdings by looking at a mix of investment choices, to manage their overall risk exposure based on their allocation spread, and to prepare for the liquidity stream they believe they will need over the short, medium, and long term with an appropriate amount of cash and liquid investments to meet those expectations.
EMPHASIZE UNIVERSAL INVESTMENT DESIRES. Another conversation topic that is politically agnostic is to discuss with investors their goals for legacy planning to pass wealth to the next generation or generations, their desires to fund philanthropic goals with their investment portfolio, and each investor’s personal desires to own or be a part of worthwhile causes or companies, from their perspective. These objectives span political parties and often remain core throughout your client’s investment life cycle.
EXPLAIN THE INVESTMENT PROCESS CLEARLY. It bears repeating often that investors will always feel more comfortable owning that which they have a strong baseline understanding of what the strategy is, how it is expected to perform, and how to interpret the deviations from the anticipated performance. Too often, fund managers and their communication personnel emphasize acquiring new investors with marketing over informing existing investors about how things are going on a consistent basis. Well-informed investors are more likely to stick with a manager through down periods than those who don’t feel knowledgeable about what is happening and why.
INCREASE THE ACCESS TO COMMUNICATION OPTIONS FOR REGULAR UPDATING. To that end, proactive fund managers will invest in communication channels that deliver the information in a manner that best serves their constituents. Web portals can offer secure, password-protected venues for both interview streams, written formats- website, blog, etc., and links to third-party sources such as fund administration, educational forums, conferences, speeches, etc. Build it once, provide the content, and you will receive the benefits a hundredfold for keeping your client base comfortably up to date.
KEEP THE FOCUS ON THE FUTURE. Last, what’s to come should remain the focus of both investment managers and investors alike. While the past may inform the future, what’s done is done. Take an accounting of where you are, confirm your plans and intent for where you want to go, and set the course for the months ahead. November is a prime time to take stock of all this, and then look to the new year with a calm determination that at least for now, you are on track.
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