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Investment Management

Financial Clarity In A World Full Of Choices

The Situation

Over the last several years, the world of investments has become much more complex. Investors have never before had so many choices with so many potential outcomes. The proliferation of information and ideas for investing can sometimes mask the underlying complexities and challenges of being a successful investor.

When new clients come to Whitnell, they often have specific investment goals, some ideas about how to achieve those goals but usually little time. Most of our clients are deeply involved with their families, their careers, their businesses and the charities that drive them passionately forward. Managing their investments is important to them, but not at the top of their priority list.

Many new clients come to us because it has become increasingly difficult to sift through the range of available information and develop a sound long-term strategy. They realize that they don’t have an effective plan and don’t know how to build one. They struggle to align their investment portfolio with their objectives.

Most of our clients simply don’t have the time to become expert investment managers. They realize that even with Internet tools, this is not enough to be a real expert. Many people watch investment-oriented television and read articles and then manage their portfolio based on this general advice. But they soon realize this strategy is inadequate and they need advice from investment professionals who understand their unique situation and goals.

Other clients come to us because they’ve become deeply frustrated. While they may have set some goals, they’ve come to realize that their expectations about returns were unrealistic. In other instances, they’ve recognized that their portfolio structure does not represent the reality of their goals. Because they haven’t thoroughly completed the process of setting goals and objectives, their portfolio doesn’t match their goals.

This is not made any easier by the popular media. The investing world seems to emphasize short-term results and risks, and this endangers the likelihood that investors will accomplish their goals. We believe it is fair to say that today there is so much information, yet so little knowledge.

Other clients come to us because they’ve lost confidence in their ability to make good long-term decisions. Far too often, investors do the opposite of what they should do. They buy when they feel good and sell when they shouldn’t.

Unfortunately, professional advisors are not immune to the kind of emotions that drive the market generally. Fear and greed are the culprits. Far too many professional investors fear that they may be missing out on the next hot item. Or they get greedy when they should be conservative.

Another way the popular media has made it difficult for investors is by making it seem easy and painless to be a professional investor. This sometimes raises expectations that investment management, as a professional service, should be free or very inexpensive. Some people believe they should not have to pay for investment management and counsel. But wise investors have realized the value of a disciplined and controlled process being managed by a third-party professional.

The right long-term investment plan aligns a client’s objectives with a properly structured portfolio. But without this plan, it is nearly impossible to achieve goals.