Keynote: A Global Perspective
By Michael Blomfield CEO of Investment Trends / Keynote
Each year, online broker executives look forward to the Investment Trends annual global survey for lessons learned across the globe about the online investing business and client experience. At last year’s Online Broker Summit, they enjoyed a preview of the survey findings, presented by Investment Trends CEO, Michael Blomfield along with his firm’s interpretation of the retail investing landscape.
The overarching mood from the survey, according to Mr. Blomfield, is that investors around the world have serious concerns right now. They’re worried about domestic economies, the U.S. economy and high debt levels. Because of this, they’ve become frozen with fear. They’re holdings positions too long or staying out of the market too long, and this relates to both investors and brokers.
To fix this, brokers need a proper understanding current investor needs and concerns.
Getting investors to turn to brokers first
“When we ask people where they go for help, the first thing they tell us is Google,” Blomfield noted. This isn’t good, since each of these investors has a broker or wealth manager. But it seems investors aren’t getting what they need from their brokers.
What is it investors need? Blomfield has asked that question, too, and the answer is invariably that they need someone to tell them what to do in this environment of uncertainty. Blomfield stressed that investors don’t say they want more education or more research. They want specific trading ideas and strategies, and brokers who can connect with investors and provide those things will see their client satisfaction levels improve...
Today’s indicators of fear
Two growing trends highlight investor fear of not knowing what to do:
• Exchange-traded funds (ETFs): Investors appear to be thinking, “If you can’t tell me what stock to buy, I’ll just buy a whole bunch of them. This approach may be better than doing nothing, but it won’t lead to a drastically better outcome, and it’s not in investors’ best interests.”
• Robo-advice: Robo is based on an understanding of our inability to efficiently make decisions, particularly in high-pressure environments. This rise in popularity is problematic, because each investor has a different financial situation and a different set of remuneration targets.
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