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We have an operating theory here at DataPoints that goes like this: portfolio returns are being commoditized for the vast majority of retail investors–either by robo-style services or index strategies, or both–and that this large swath of the population will be willing to pay less for the (likely illusory) promise of market-beating portfolio returns from their would-be financial advisors. This development will in turn put pressure on the financial services industry in general and …
The financial technology (or fintech) landscape is evolving rather quickly, and some are calling it the “golden age of fintech.” I recall thinking only a few years ago that DataPoints didn’t quite fit in any of the categories of the various fintech maps that were published. The groupings of CRMs, financial planning software, re-balancing tools, etc. were clear enough. But there really wasn’t a place for psychology and behavioral science in the mechanics of financial …
Have you ever dismissed a concept because it sounds too “soft,” that it won’t help or be applicable to your practice, life, or clients? One of those concepts that has suffered from a branding problem in the financial world is mindfulness. However, with the increased focus on holistic financial planning, it’s gaining some ground a an increased reputation as a way to help achieve financial success. Let’s consider it in light of spending. News-flash: Excessive spending …
We define volatility composure as a combination of past experiences and behavioral patterns that describe how an investor typically reacts to changes in the market value of his or her investments as well as overall changes in the value of the stock market. How will the individual actually behave–as opposed to how they think they will behave–when the stock market goes haywire (as it is doing now for the first time in quite some time)? …
According to Vanguard’s Advisor Alpha study, working with an advisor can add incrementally to an investor’s portfolio. Half of the contribution of an advisor’s value is through behavioral guidance. This guidance includes helping clients to make better investing decisions, ignore the herds, and stick to a strategy. These findings beg the question: Would these benefits increase if we added a framework to the guidance that advisors provide? To create a better mousetrap of understanding …