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.

The financial markets are upended again for the second time in the last 12 years, although the underlying reasons for the volatility are quite different. 

A recent article from CNBC outlined three major differences between then and now and what those differences mean for financial advisors moving forward. 

1 – Banks to Blame

During the Great Recession, the banks were largely to blame. The banks approved mortgages for subprime borrowers in unprecedented numbers, inflated their profits, minimized their risk and ultimately created a housing market bubble that burst. This time around, the market volatility is largely due to uncertainty created because of the virus’ impact. Even though Jerome Powell, chairman of the Federal Reserve, said the economy could contract by as much as 30% during the second quarter, banks are better equipped to weather this storm. For comparison, the biggest quarterly drop during the Great Recession was 8.4%.

2 – Quick Draw

During the Great Recession, Lehman Brothers was allowed to collapse. The Bush and Obama administrations took action—by providing liquidity through TARP and offering fiscal stimulus to the tune of $941 billion.

In the current crisis, the Federal government acted much quicker. The Federal Reserve cut the federal funds rate to almost zero, and kicked off a corporate bond buying program. The Federal government also passed numerous relief and stimulus packages, including a $2 trillion stimulus package in March alone, the month the outbreak exploded in the U.S.

3 – Market Freefall

During the Great Recession, the major stock indexes fell 50% over an 18 month period, which caused many investors to ditch the markets and ultimately miss out on the rebound.

The market freefall during this crisis was much more swift, leaving many investors shellshocked into inaction. For example, the S&P 500 dropped by 34% between Feb. 19 and March 23, the quickest descent into a bear market in history.

Read the full article from CNBC.

Despite wild volatility for weeks, the majority of financial advisors expect it to still get worse before it gets better. So reports CNBC.

An overwhelming 81% of advisors polled by Ned Davis Research say they think we have yet to hit bottom. They expect the S&P to continue to fall below its March 23rd levels. At that point, the S&P was down 34% from its Feb. 19 high mark.

Meanwhile, more than half expect the market to bottom out by the end of May, while one in four think it will occur later.

Read the full article from CNBC.

Many advisors have seen crisis before, including Black Monday and the Great Recession, but the coronavirus global pandemic is uncharted territory. So reports Bloomberg.

Not all clients have the same goals. Here are some of the biggest questions FAs are getting and a sampling of how they’re handling them

Is it time to buy?

Susan Kaplan, an RIA in Newton, Mass., says she’s been “holding people back” because she foresees more volatility until the outbreak is over. She caters to clients with net worths of $10-$12 million

‘Is it time to sell?’

Leon LaBrecque, chief growth officer at Sequoia Financial Group, says half of his calls are about buying opportunities, while the other half are from concerned clients. He says the concerns are financial, but also about the virus and how it impacts his clients' careers and their lives in general. His advice about their accounts: sit tight, for now.

‘Should I be scared?’

Steve Morton, of Captrust Financial Advisors, says his clients “set aside five years of money for income” and use the rest of their money to invest in actively managed stock and bond. This approach provides them with income for the next half decade. “Certainly within five years we’re going to come up with a vaccine for this. That calms them down," he told Bloomberg.

Read the full article from Bloomberg.

Recent market volatility is drawing an awful lot of comparisons to the Great Recession. But, according to a recent USA Today article, the damage caused by the coronavirus won't likely be as deep or long-lasting as in 2007-08.

Gus Faucher, chief economist of PNC Financial Services Group, said a recession is not inevitable and that if there is one it is “likely to be brief and much less severe than the Great Recession."

One of the reasons for the difference is because the 2008 crisis was caused by significant underlying issues in the economy. The coronavirus outbreak, on the other hand, is an outside event that’s prompting the volatility. Some compare it to a “natural disaster.”

Once the outbreak is over, the economy’s major players should be poised for a comeback, according to the article.

For a deeper comparison between today and 2008, click here to read the full article from USA Today.

Edward Jones ranked No. 1 among investment firms for customer experience in The US Customer Experience Index, 2020. This is the fifth consecutive year the firm has received the highest spot on the CX Index among investment firms from Forrester Research, an independent research firm. 

Forrester's Customer Experience Index (CX Index™) methodology measures how well a brand's customer experience creates and sustains the loyalty of its customers. In addition to the No. 1 ranking overall, Edward Jones finished highest in the categories of Customer Service and Clear Communications among investment firms. And the likelihood of recommending their investment firm was highest among Edward Jones clients.

"We strive to build deep personal relationships with every one of our clients. It begins with understanding what is most important to our clients, then how, when and where they want to be served, which helps us deliver an ideal experience for each client," said Ken Cella, Edward Jones principal for the Client Strategies Group. "But more than that, our relationships are based on truly listening to our clients so that we can understand their goals and motivations and ultimately build personalized solutions that holistically support their life's goals."

The ranking was based on responses from 15,765 US individuals measuring 21 brands in the investment firm industry. The proprietary survey results are based on consumers' opinions of the experiences with the brands in the survey.

Read the full press release here.

Robinhood is making multiple changes in the wake of the suicide of one of its customers who suffered massive losses. So reports CNBC.

The customer, 20-year old Alex Kearns, threw himself in front of a train after he believed he suffered $730,000 in losses. In his suicide note, Kearns, a sophomore at the University of Nebraska at Lincoln, accused Robinhood of allowing him to pile on too much risk. It is unclear whether Kearns actually lost $730,000 or whether he misread the financial statement.

In response, Robinhood, a free-trading app, announced it would be making changes. It will increase eligibility requirements and “consider additional criteria” when it comes to more sophisticated options trading. It will also update its user interface and improve its messaging and communications.

The company also announced it is donating $250,000 to the American Foundation for Suicide Prevention. 

Read the full article from CNBC.

A new survey from Northwestern Mutual finds that about one in five respondents younger than Baby Boomers did not have a financial advisor before the pandemic but want their advice now. So reports Financial Advisor.

Generations younger than Baby Boomers include Gen Xers, Millenials and Gen Zers. Of those surveyed, 22% of millennials and Gen Zers are now looking for an advisor, while 19% of Gen Xers are doing so.

The study, Northern Mutual's 2020 Planning and Progress Study, is ongoing. The most recent survey of 2,077 U.S. adults, was conducted between April 29 to May 1. The survey found that about 20% of those with a financial plan prior to the pandemic are revisiting it due pandemic. 

Read the full article from Financial Advisor. 

David Arthur Wismer III, a former LPL Financial advisor who was on probation after a 2018 conviction of sexual assault on a child by one in a position of power, is heading to jail for contacting the victim repeatedly. So reports Financial Planning.

Wismer, 55 and a registered sex offender, was sentenced on May 18 after speaking to the victim more than 100 times over the phone during a ten month span. The victim, who was a teenager at the time of the sexual assault, is now 20.

Read the full article from Financial Planning.

Once a new client has decided to hire you, there are some basic steps you can take to make sure the relationship starts off on a positive note.

Here are three tips from TheStreet.com.

1. Have your client service person join the initial meeting and have him or her send the client a copy of your firm’s materials and checklist ahead of the meeting. That way, during the actual meeting, the client service professional can review the checklist to help ensure you get all the information you need to do your job. This will also help instill confidence in your firm and demonstrate it has an efficient process. 
2. Introduce your new client to your entire team, if you have one. This includes any partners, advisers, administrative personnel and client service members. This demonstrates to the client that they are not hiring only you, but your entire team. 
3. Be sure to balance our pleasantries and making the human connection with getting down to business. Don’t lose sight of the fact that the client hired you to do a job. Revisit items they discussed with you during the hiring process, confirm their financial priorities, and outline the what the can expect from you, including how frequently you’ll meet and communicate with them.

Read the full article from TheStreet.com.

With many courts and regulators moving to remote proceedings, financial advisors dealing with FINRA have some quick learning to do. So reports Lexology.

Zoom meetings and others like it can pose some significant challenges. While its best to avoid or postpone such proceedings, when possible, Lexology offered some tips for those that are unable to delay.
The publication said its important to be sure you can be seen and heard on camera and that your presentation looks professional. Consider camera angles and minimizing background noise. You may also want to use smaller exhibits or breaking your presentation down into smaller subsets to make it more consumable in this medium.

Another important tip is to use two computer monitors—one for your presentation materials and the second for your speaker notes and other presentation aids that will help you make your argument. Some other recommendations include:

• Use a tech-savvy court reporter, if possible
• Practice your presentation ahead of time
• Make sure you are heard. Zoom meetings often feature people talking at the same time or over one another, which can make it challenging for the participants, including the court reporter to capture everything. Repeat yourself if necessary and confirm your statements are part of the record.

Read the full article from Lexology.

UBS’ Mitch Slater, host of ‘Financially Speaking with Mitch Slater,’ says he never discusses the market or investing on his podcast because its boring. So reports Think Advisor.

Prior to his decades-long career as an advisor, Slater produced talk shows for the likes of Larry King and David Susskind. On his current podcast, Slater interviews entrepreneurs, executives and celebrities about their financial and business success stories.

Although the podcast isn’t intended as a prospecting tool, Slater says it has brought in business. Rather, the podcast is about branding—it’s a way for listeners to get to know him. “I don’t believe that doing a show on investing is the right way to build your business,” he tells the publication. “Also, it would be fiscally irresponsible for me to give financial advice. I do that only when I know an individual’s situation.”

Read the full article from Think Advisor. 

The coronavirus has thrown businesses across the U.S. into uncharted territory, including financial advisor practices. 

CNBC examined how three FAs have managed during the pandemic. 

Chris Pollard, a U.S. Army veteran, and a CFP and principal at Great Path Planning, had to put his business continuity plan to the test. It called for working from home or a public location with web access, or even using his cellphone to get internet access. 

Even though he was allowed to keep his office open, Pollard instead moved his client interactions to phone and video chats as many of his clients are in the high-risk category for COVID-19. He said he wanted clients to know he would take care of them, no matter the circumstances. 

CFP Dennis Stearns, founder Stearns Financial Group in Greensboro, North Carolina, said his firm developed a pandemic plan in response to the SARS outbreak. Stearns said his firm has proactively reached out to clients and increased client communications by “a factor of three.” Stearns also notes that before the pandemic, only 10% of the firm’s 600 clients interacted with advisors via GoToMeeting, but that has jumped to 90%. The remaining 10% are using the phone. 

Meanwhile, Hannah Moore said half of her client base was meeting virtually prior to the pandemic. Now, all interactions are online or via phone. Moore, owner of Guiding Wealth in Dallas, said her client base is mostly older individuals thinking about retirement. After the crisis has subsided, Moore expects that more clients will prefer to interact with her online. 

Read the full article from CNBC.