Financial advisors often promote their services by saying that they can help remove emotions from investing. In theory, advisors can use a variety of risk management tools, knowledge of capital markets, and long-term investing perspectives to help their clients avoid making costly knee jerk reactions.

Brexit is just one example, but it can be a powerful case study for advisors seeking to help clients understand why emotions should be curtailed by financial professionals who are armed with capital markets expertise.

In the months leading up to the Brexit referendum, markets climbed and declined in response to changing expectations for how the country’s citizens would vote. In the final days before the vote, investor sentiment strengthened as pundits increasingly said a vote in favor of the U.K. pulling out of the European Union was unlikely.

Many investors had previously feared that Brexit would hinder economic growth in Europe and create a challenging environment for U.S. companies and business in other countries that sell products in the continent.

Indeed, Brexit is likely to mean that U.K. will have to forge new trade agreements with individual members of the European Union and is likely to have to do the same with U.S. exporters.

When the Brexit referendum surprisingly determined that voters want to leave the U.K., panic ensured. On June 24, when the results were released, U.S. equities dropped approximately 3%. It was the worst single-day decline for the S&P 500 in nearly a year and wiped away the index’s gain for 2016, according CNBC.

By the end of June 27, the index had dropped 4.07%. The decline, however, was only temporary. Indeed, during the last three days of June, the S&P climbed 4.95% and, as of July 8, had generated a total return of 4.21% year-to-date.

Investors who panicked by selling in the days immediately after Brexit are likely to have sold during a dip, only to miss the strong returns when equities bounced back. With that in mind, advisors should explain to their clients that panic selling often results in selling low and then missing out on the strong returns that typically follow market dips.

They should explain, furthermore, that using portfolio diversification to cushion declines, maintaining a long-term perspective, and understanding the role of corporate fundamentals can go a long way in helping investors avoid panic selling.

Advisors should develop illustrations that show how having a mix of asset classes could have reduced the impact upon a portfolio of the post-Brexit market decline and that portfolio rebalancing may have resulted in buying equities during the market dip.

They should also show index performance numbers that illustrate how riding out historical market declines, including the correction associated with the Great Recession, would have allowed investors to recoup losses and then eventually achieve additional gains.

Finally, advisors should point out that corporate fundamentals don’t justify a major prolonged market correction. While overall corporate earnings in the U.S. have taken a hit due to cheap oil, many industries, such as Information Technology, are experiencing strong sales and improving profits.

Innovation, meanwhile, is allowing companies like Amazon.com and Netflix to rapidly grow their earnings by disrupting traditional business models with technology. At the same time, corporations are holding near record levels of cash, which is allowing them to buy back stock, launch dividends, and conduct mergers and acquisitions at near record levels.

All of those actions provide additional support to stock prices. The U.S. economy is also likely to support corporate fundamentals. While U.S. economic growth has been slow, many developments are encouraging, with the labor market strengthening, real estate values increasing, and consumers’ finances improving.

Collecting Social Security early can help retirees assess how much they can spend because the payments are consistent. So reports Wealth Management.

Also, proponents of waiting typically point to the 8% payment increase you get for delaying the payments. However, the nominal annualized reture when waiting a year is less than 8% and retirees will miss out on a full year of payments. 

Lastly, collecting Social Security may be more attractive than withdrawing money from an IRA when considering taxes.

Read the full article from Wealth Management.

The Securities and Exchange Commission recently awarded a whistleblower $3 million for information that helped the regulator crack a complex case of fraud. So reports ThinkAdvisor. The program was established more than three years ago and has paid out more than $50 million to whistleblowers.

Read the full article from Think Advisor.

Robert Renshaw has joined Edison, N.J.-based Fountainhead Capital Management as senior financial strategist. So reports TapintoEdison.

Fountainhead Managing Partner Marc Rock says Renshaw’s strength involves understanding each client’s unique circumstances and partnering with the appropriate team members to create customized strategies.

Read the full release from TapintoEdison.

Brokerage sweep accounts are intended to be a temporary place to park cash resulting from trades and they currently yield just 0.25%. Therefore, they are a poor option for holding cash. So reports Barron’s.

In comparison, money markets are yielding 1.8%.

Read the full article from Barron's.

Overall sales of annuities during the first quarter of 2019 totaled $57.8 billion, up 17.5% year over year. So reports Insurance Net News.

However, its down approximately 3.6% from the last quarter of 2018, according to data from Beacon Research and Morningstar and reported by the Insured Retirement Institute. In the most recent quarter, fixed annuity sales reached $37.1 billion and variable annuity sales reached $20.7 billion.

Read the full article from Insurance Net News.

Fidelity and New York Life Insurance Company have joined forces to launch the New York Life Premier Variable Annuity—P Series that will provide a minimum accumulation benefit rider. So reports ThinkAdvisor.

New York Life maintains that its analysis shows that in many circumstances, annuities with a minimum accumulation rider will outperform annuities that don’t offer the feature.

Read the full article from ThinkAdvisor.

Even though asset management fees have been declining, expenses for investors are still stubbornly high, says Morningstar CEO Kunal Kapoor. So reports Wealth Management. 

He also says Morningstar avoids pay-for-play arrangements, which are agreements that require mutual fund companies to have their products distributed, so it can stay on the side of investors.

Read the full article from Wealth Management.

Investment Advisor magazine has selected Cambridge Investment Advisors as the 2019 Broker-Dealer of the Year for firms with more than 1,000 representatives while American Portfolios Financial Services won the top slot for firms with 500 to 999 reps. So reports Think Advisor.

Other winners in categories for smaller firms include The Investment Center and Prospera Financial Services.

Read the full article from Think Advisor.

After floating the idea of cutting the payroll tax, President Trump said he is no longer considering the option because the U.S. economy is already strong enough. So reports the Associated Press.

He also rejected his earlier proposal to index capital gains tax to inflation.

Read the full article from the Associated Press.

AssetMark’s stock price popped approximately 22% to $25.45 after the TAMP went public in mid-July and its price has been trading in a range of $23.63 to $28.62. So reports RIABiz.

Huatai Securities in the People’s Republic of China purchased the company three years ago for $780 million and the IPO values the company’s market capitalization at more than $1.6 billion.

Read the full article from RIABiz.

Ladenburg Thalmann Financial Services, which is a network of 4,000 advisors, has invested an undisclosed sum in Newday Financial Technologies, which is an impact investing robo-advisor. So reports ThinkAdvisor.

Ladenburg Thalmann’s Ladenburg Innovation Lab will work with Newday to find ways to provide greater value to investors and Ladenburg advisors.

Read the full article from ThinkAdvisor.

Many advisors fail to win clients because they talk too much and then fail to listen, says Sara Grillo, a marketing consultant. So reports Advisor Perspective.

To avoid this problem, limit comments to an observation about the client’s situation and the client’s options and then listen to the client’s response.

Read the full article from Advisor Perspective.

With its planned acquisition of Allen & Company of Florida, LPL will offer its advisors, who currently serve as independent contractors, the opportunity to become full time independent employees of the company. So reports Barron’s.

Industry observers, however, question if employees of the firm will have sufficient freedom to be called independent or if the term simply refers to LPL as an independent broker-dealer.

Read the full article from Barron's.

Advisors can improve their prospecting by having narrowly defined target clients, developing content marketing campaigns and using social medial. So reports U.S. News & World Report.

Rather than simply targeting prospects with a minimum amount of investible assets, advisors should specify both minimum and maximum assets and also specify geographic locations, targeted age ranges and if ideal prospects have their own businesses.

Read the full article from U.S. News & World Report.

Helping to implement IRA Trusts and monitoring the programs can be an attractive market for financial planners who currently compete against no-cost or low-cost advisory platforms, writes Ed Slott, a popular authority on retirement topics. So reports Financial Planning. Many individuals fail to implement trusts proposed by their attornies and, if they do take follow up actions, the programs need to be managed, especially when considering that IRAs are not set-and-forget programs.

Read the full article from Financial Planning.