43% of Advisors
A piece at Investment Executive titled “Client calls surge amid heightened geopolitical tensions” got my attention this week. You can read it here.
All data in the piece is from a poll conducted by Fidelity Investments Canada ULC on March 4th. The sample size was between 790 and 1,100 advisors. Here’s an important excerpt.
More than half (58%) of advisors have reported receiving higher volumes of client calls amid heightened geopolitical tensions…. Overall, 54% of respondents said they have or will tweak portfolios to diversify. At the same time, 43% reported making no changes to well-tested client plans.”
I bolded that sentence because those advisors are doing what they’re supposed to be doing. Investment portfolios should only be changed if a client’s financial plan changes. Investment portfolios should never be changed because of a crisis du jour. Today the crisis is heightened geopolitical tensions (i.e., war). Last year the crisis was tariffs. Four years ago, it was inflation. Six years ago, it was a pandemic. I can go on.
Sticking to your plan is supposed to be difficult. Your equity investments, assuming they are appropriately diversified, doubling every seven to ten years sounds so simple.* But it only works if you stay out of your own way. There are many external factors that want to get in your way. And crises du jour will get in your way. You just need to power through them because we know that crises end.
Of that sample of advisors, only 43% of advisors are doing their jobs. It’s a tough job, and I tip my hat to them.
*This is what history tells us to expect in appropriately diversified equity portfolios.