In difficult financial times one can still make money in investments. Part of what is needed is finding good financial advisors. No matter how skilled one is at technical and fundamental analysis of investments, there is no need to repeatedly reinvent the wheel. Finding good financial advisors does not mean that you must do everything that they suggest. Sometimes it is simply a good idea to get a new perspective on investing. So, what pieces of information and traits are important when finding good financial advisors? You will want to see a track record of success. Ideally that record of successful investing advice goes back for many years. You will want to see success during both bull and bear markets as well. What skills go into making a good financial advisor? A good financial advisor needs to start by listening to you and getting to understand our financial needs and wishes. A good advisor needs to be consistent, which goes along with having a good track record that goes back years. In finding good financial advisors one needs to find someone that they can trust. The Madoff pyramid scheme comes to mind here. Many people with lot of money fell for Madoff’s story of easy riches and paid a terrible price. And a good financial advisor needs to be able to communicate well. You may have found the best stock picker and investor imaginable but if he or she cannot explain what you need to do and how to do it in a timely manner he or she is of little use to you.
What Constitutes a Good Track Record?
In finding good financial advisors it is important to find those who make money during good times and don’t lose it all during bad times. Picking someone who is honest goes without saying. If you are uncertain about someone ask for references. And if you really are uncertain about someone leave your money in the bank until you are comfortable with the person that you pick. What is best is to check out two or three financial advisors and compare not only their track records but their stories as well. How do they approach investing? What do they consider a good investment? Do they constantly enter and leave the market? Do they invest in very volatile stocks or in stocks that let you sleep soundly at night? Compare the performance of the advisor with that of the S&P 500 or Dow Jones Industrial average over year or, better, decades. Compare the purchasing power of the money that they manage with money put into T bills and rolled over and over. There has to be a good reason to let someone tell you how to handle your money. Make sure that the track record and story of the advisor you pick makes sense to you.
Finding Good Financial Advisors
There is a reason that this article has a plural in the title. If you have sufficient assets that you can afford to have someone else manage them, you may well have enough to pick more than one financial advisor or money manager. And, if you have money but little experience your advisor should be willing to help you in learning how to invest. Anyone who routinely keeps you in the dark may have reasons to hide information. Make sure that when you invest for retirement or any other purpose that you are picking investment advisors who work for you and have only your interests at heart.