A deeper understanding of the behaviour of investors will see significant client growth and a greater amount of referrals, according to a global study of financial advisers.
Financial advisers who engage in leading ‘know your client’ behaviours see 72 per cent higher net client growth and 56 per cent more of their clients are very willing to recommend their services to family and friends, says the benchmarking study from an international coalition of advice-related entities, including the Association of Financial Advisers (AFA).
Other entities involved in the study included Financial Advice New Zealand, the Portfolio Construction Forum (Australia and New Zealand), the Financial Planning Association (US), Berkeley Executive Education (US), Capital Preferences (US and New Zealand) and T. Rowe Price (US, Australia and New Zealand).
Other takeaways from the study included:
AFA chief executive Philip Kewin said it was delighted to participate in the study, and confirmed his belief that the human aspect of the advice relationship is vitally important to both advisers and clients.
“It reveals that advisers who have strong relationships with their clients have strong businesses,” Mr Kewin said.
“Advisers with strong client relationships can potentially deliver superior outcomes, because they have a genuine understanding not just of the client’s specific needs, but also of the client as an individual.”
Over 300 client-facing advisers in Australia, New Zealand and the US were surveyed for the benchmarking study.