Behavioral Finance
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Financial Quick Takes: Wisdom of Crowds vs. Popular Delusions
Created: September 25, 2023
Categories: Article, Behavioral Finance, Evidence-Based Investing, General Audience, Quick-Reference
Description: Are markets wise, as James Surowiecki suggests in "The Wisdom of Crowds"? Or are they delusional, as described in Charles Mackay's "Extraordinary Popular Delusions and the Madness of Crowds"? This quick take summarizes why they can be either or both, and how that shapes your investment recommendations. By creating and sticking with a low-cost, globally diversified portfolio, investors can capitalize on group wisdom and avoid group mania.
Financial Quick Takes: Making Mistakes
Created: September 5, 2023
Categories: Advisor Role/Value, Article, Behavioral Finance, Evidence-Based Investing, General Audience, Quick-Reference
Description: A quick-take piece emphasizing the difference between avoidable investment mistakes versus random market misfortune. By eliminating avoidable mistakes, investors can also lower, but not entirely eliminate, the possibility of experiencing negative investment outcomes.
Quarterly Client Letter – 2022 Q4
Created: January 4, 2023
Categories: Behavioral Finance, Client-Focused, Economics, Evidence-Based Investing, Fixed Income, Quarterly Client Letter, Scary Market Insights
Description: This quarterly and year-end client letter looks back on negative returns in 2022, and cautions clients against letting potential pessimism alter their asset allocation decisions. You never know what the near-term future holds, so long-term planning remains advised.
Back to the Investment Basics: Part 5 — Patience and Personal Persistence
Created: October 12, 2022
Categories: Article, Back to the Basics, Behavioral Finance, Evidence-Based Investing, Financial Planning, General Audience, Scary Market Insights
Description: This part 5 is the last installment in our multipart Investment Basics series, and covers two more essentials: being patient and ensuring personal financial goals drive the decision-making. Earlier parts explored the history of investing; how important it is to save (so you have money to invest); how to invest efficiently in broad markets; and why to avoid chasing or fleeing rising or falling prices.
Back to the Investment Basics: Part 2 — First Save, Then Invest
Created: September 6, 2022
Categories: Article, Back to the Basics, Behavioral Finance, General Audience, Scary Market Insights
Description: Part 2 of a multipart series reminds investors to consider current market events in proper historical context (in part 1), while depending on investment basics to move past today's challenges and future unknowns. In this part 2, we covered the importance of saving. In upcoming parts, we'll cover four more investment basics: market returns, market pricing, investor resolve, and personal financial goals.
Back to the Investment Basics: Part 1 — Remembering Summers Past Free Sample (Click on title to download)
Created: August 29, 2022
Categories: Article, Back to the Basics, Behavioral Finance, Breaking News, Economics, Evidence-Based Investing, Free Samples, General Audience, Politics
Description: Part 1 of a multipart series reminds investors to consider current market events in proper historical context, while depending on investment basics to move past today's challenges and future unknowns. In upcoming parts, we'll cover five investment basics: saving, market returns, market pricing, investor resolve, and personal financial goals.
Healing What Hurts: The Essential Role of a Financial Therapist
Created: February 16, 2022
Categories: Advisor Role/Value, Article, Behavioral Finance, Estate Planning, Family Wealth, Financial Planning, General Audience, Report, Wealth Management
Description: This 3-page report describes the value a financial therapist can add to someone’s wealth management team when their own or a family member’s mental health may be interfering with their financial well-being. Points include when and how financial therapy can help, and how to identify an appropriate fit (including how your firm can assist in the selection).
Fighter Planes and Market Turmoil
Created: January 26, 2022
Categories: Behavioral Finance, Breaking News, Client-Focused, General Letter/E-Mail, Scary Market Insights
Description: Use this client reach-out to quell nervous reactions to current market volatility and encourage clients to stick with their existing investment plans.
Quarterly Client Letter – 2021 Q4
Created: January 3, 2022
Categories: Advisor Role/Value, Behavioral Finance, Client Experience, Client-Focused, Evidence-Based Investing, Quarterly Client Letter
Description: This quarterly client letter explores recent and future market returns in the context of investors' personal financial goals--considering the "parts" and the "whole."
Lump-Sum Investing vs. Dollar-Cost Averaging — Part 2: Actual Outcomes
Created: September 28, 2020
Categories: Advisor Role/Value, Article, Behavioral Finance, Evidence-Based Investing, General Audience
Description: This 650-word document is part two of a two-part series comparing lump-sum investing to dollar-cost averaging. This first part describes why lump-sum investing is generally expected to deliver higher end returns. In part two, we cover why other issues may sometimes make dollar-cost averaging the preferred strategy anyway.
Lump-Sum Investing vs. Dollar-Cost Averaging — Part 1: Raw Returns
Created: September 21, 2020
Categories: Advisor Role/Value, Article, Behavioral Finance, Evidence-Based Investing, General Audience
Description: This 610-word document is part one of a two-part series comparing lump-sum investing to dollar-cost averaging. This first part describes why lump-sum investing is generally expected to deliver higher end returns. In part two, we'll cover why other issues may sometimes make dollar-cost averaging the preferred strategy anyway.
How To Be Positively Skeptical | Part 4: Check the Facts Before You Act
Created: May 17, 2020
Categories: Advisor Role/Value, Article, Behavioral Finance, Breaking News, Evidence-Based Investing, General Audience, How To Be Positively Skeptical, Politics
Description: Use this third, 898-word installment of a 4-part series to help clients and prospects strengthen their ability to differentiate solid evidence from bogus claims, especially during the coronavirus crisis. Parts 1-3 described why it's important to be positively skeptical, how our emotions interfere with our reasoning, and what should guide our due diligence. Part 4 describes some of the practical steps involved and wraps with a call to action.
How To Be Positively Skeptical | Part 3: How Do You Do Your Due Diligence?
Created: May 17, 2020
Categories: Advisor Role/Value, Article, Behavioral Finance, Breaking News, Evidence-Based Investing, General Audience, How To Be Positively Skeptical, Politics
Description: Use this third, 673-word installment of a 4-part series to help clients and prospects strengthen their ability to differentiate solid evidence from bogus claims, especially during the coronavirus crisis. Parts 1 and 2 described why it's important to be positively skeptical, and how our emotions interfere with our reasoning. Part 3 provides five “do’s” and “don’ts” to guide our due diligence, and Part 4 will offer some of the practical steps involved.
How To Be Positively Skeptical | Part 2: Understanding Your Emotions
Created: April 29, 2020
Categories: Advisor Role/Value, Article, Behavioral Finance, Breaking News, Evidence-Based Investing, Financial Planning, General Audience, How To Be Positively Skeptical, Technology
Description: Use this second, 844-word installment of a 4-part series to help clients and prospects strengthen their ability to differentiate solid evidence from bogus claims, especially during the coronavirus crisis. Part 1 described why the ability to be "positively skeptical" is important. This part 2 covers how to recognize when emotions are interfering with reason (and what to do about it). Parts 3 & 4 will help readers hone in on their fact-checking skills.
Three Thoughts During Scary Markets Free Sample (Click on title to download)
Created: March 9, 2020
Categories: Advisor Role/Value, Behavioral Finance, Breaking News, Client Experience, Client-Focused, Evidence-Based Investing, Free Samples, General Letter/E-Mail, Scary Market Insights
Description: As market headlines go from bad to worse, share this 685-word confidence-building reach-out with your clients (or, with modest edits, with a wider audience). Includes a review of the relationship between risk and expected reward, the significance of being prepared in advance for these kinds of downturns, and a reminder that you remain available to provide objective advice.
How To Be Positively Skeptical | Part 1: The Benefits of Having a Doubt
Created: February 27, 2020
Categories: Article, Behavioral Finance, Evidence-Based Investing, General Audience, How To Be Positively Skeptical, Politics, Security, Technology
Description: Use this first, 600-word installment of a 4-part series to help clients and prospects strengthen their ability to differentiate solid evidence from bogus claims. Part 1 describes why the ability to be "positively skeptical" is important. Parts 2 - 4 will cover how to recognize when emotions are interfering with reason, and how to hone one's fact-checking skills.
Quarterly Client Letter — 2019 Q3
Created: October 2, 2019
Categories: Advisor Role/Value, Behavioral Finance, Breaking News, Client-Focused, Politics, Quarterly Client Letter, Scary Market Insights
Description: Use this 442-word quarterly client letter to remind clients to stay the course amidst breaking global news. It explores how reflexes in your brain can play tricks on your financial resolve.
The ABCs of Behavioral Biases (UPDATED)
Created: September 18, 2019
Categories: ABCs of Behavioral Biases, Advisor Role/Value, Article, Behavioral Finance, General Audience, PowerPoint Presentation, Quick-Reference, UPDATED Content, White Paper
Description: UPDATED FROM AUG. 2017: This collection of materials includes: (1) a 5,800-word white paper, (2) the same materials broken into a seven-part drip series, and (3) an ALL-NEW PowerPoint presentation on "The ABCs of Behavioral Biases." From anchoring, to hindsight, to tracking-error regret, the series covers 17 of the most common financial behavioral biases that lead investors astray, in alphabetic order.
Quarterly Client Letter — 2019 Q2
Created: July 2, 2019
Categories: Advisor Role/Value, Behavioral Finance, Client-Focused, Evidence-Based Investing, Quarterly Client Letter
Description: Use this 632-word quarterly client letter for Q2 2019 to describe Daniel Kahneman's research into decision-making "noise," and how it can be employed for improved investing.
Evidence-Based Investment Insights Series WHITE PAPER (UPDATED)
Created: April 25, 2019
Categories: Behavioral Finance, Evidence-Based Insights, Evidence-Based Investing, General Audience, UPDATED Content, White Paper
Description: UPDATED FROM 2014: This 25-page white paper compiles the entire Evidence-Based Investment Insights series into a single document you can use to design your own company white paper. Share the paper as a printed handout or in PDF/booklet form with clients and prospects. Use it as a give-away to collect e-mails on your website or for other similar purposes. A set of 14 individual installments for "dripping" the series, and an 8-page report version of this same material also are available for separate download.
Evidence-Based Investment Insights Series REPORT (UPDATED)
Created: April 25, 2019
Categories: Behavioral Finance, Evidence-Based Insights, Evidence-Based Investing, General Audience, Report, UPDATED Content
Description: UPDATED FROM 2014: This 8-page report strikes a happy medium between the full, 25-page white paper and the individual installments available in the Evidence-Based Investment Insights series. Compiling key messages from the entire series, this report offers a mid-length, single document overview of evidence-based investing. Share the paper as a printed handout or in PDF form with clients and prospects. Use it as a give-away to collect e-mails on your website or for other similar purposes.
Evidence-Based Investment Insights Series — 14 Parts (UPDATED)
Created: April 25, 2019
Categories: Article, Behavioral Finance, Evidence-Based Insights, Evidence-Based Investing, General Audience, UPDATED Content
Description: UPDATED FROM 2014: This is a series of 14 short pieces for explaining evidence-based investment principles in a step-by-step approach. Use the series for drip marketing via e-newsletter, e-mails, mailings or as video script to introduce your investment approach to prospective clients or to review key benefits with existing clients. Collection will download as a zip file containing 14 Word documents. A compiled, 25-page white paper and 8-page report also are available for separate download.
2018 Year-End Market Volatility Client Reach-Out
Created: December 6, 2018
Categories: Advisor Role/Value, Behavioral Finance, Breaking News, Client Experience, Client-Focused, Evidence-Based Investing, General Letter/E-Mail, Scary Market Insights
Description: Use this 2018 year-end client reach-out to help clients ride out current market volatility. The document contains two versions: (1) a 580-word extended reach-out that includes references to Hans Rosling's new book "Factfulness," and (2) an abbreviated, 330-word reach-out that omits the reference to Rosling's book.
Five Financial Adages for Thriving in Volatile Markets
Created: November 19, 2018
Categories: Advisor Role/Value, Article, Behavioral Finance, Client Experience, Evidence-Based Investing, General Audience, Report, Scary Market Insights
Description: This big, meaty, 2,000-word report takes a close look at why so many investors fail to adhere to five widely accepted financial adages (e.g., "buy low, sell high"), ESPECIALLY DURING VOLATILE/DOWN MARKETS. Use this report with clients or prospects -- either as-is, or as a drip communication or video series, sharing one adage at a time, over time.
Quarterly Client Letter — 2018 Q3
Created: October 1, 2018
Categories: Advisor Role/Value, Behavioral Finance, Client-Focused, Evidence-Based Investing, Quarterly Client Letter
Description: This 530-word quarterly client letter offers three reasons investors should avoid the temptation to engage in market-timing by abandoning their existing plans and investments out of concern that the market may be "overpriced" and headed for a fall.
Quarterly Client Letter — 2018 Q2
Created: July 3, 2018
Categories: Advisor Role/Value, Behavioral Finance, Client-Focused, Evidence-Based Investing, Quarterly Client Letter
Description: This 400-word quarterly client letter reflects on the mixed bag of scary and enticing market news from the quarter, encouraging clients to stay on course with their well-built portfolio to maintain the highest odds of achieving their personal goals.
Quarterly Client Letter — 2018 Q1
Created: April 2, 2018
Categories: Advisor Role/Value, Behavioral Finance, Breaking News, Client-Focused, Evidence-Based Investing, Politics, Quarterly Client Letter
Description: This 500-word quarterly client letter reflects on the recent uptick in market volatility, encouraging clients to be in touch with you if they need a "pep talk," a shift in their investment plans, or both.
10 Things To Do Right Now While Markets Are (Not Really) Tanking
Created: March 21, 2018
Categories: Advisor Role/Value, Article, Behavioral Finance, Breaking News, Evidence-Based Investing, General Audience, Scary Market Insights, Tax Planning
Description: Use this 1,250-word handout with clients or prospects, to serve as a "safety drill" during calm markets, to help them prepare for staying the course during market downturns. The piece offers 10 judicious actions to take during bear markets, along with 10 insightful quotes from respected subject matter experts. You also can encourage readers to revisit the piece (or use it with a brief intro) the next time markets actually are tanking.
Misperceptions About Market Corrections: Are You Prepared?
Created: June 4, 2017
Categories: Advisor Role/Value, Article, Behavioral Finance, Client-Focused, Evidence-Based Investing, General Audience, General Letter/E-Mail, Prospect-Focused, Scary Market Insights
Description: This 750-word document can be used in letter, email, article or video script format to help clients and prospects prepare for any future market corrections following the current long stint of relative calm. It encourages readers to ensure their portfolio meets their long-term goals and risk tolerances. Choose from two calls to action at the end, depending on whether you're sharing it with clients or prospects.
Our Mixed Up, Messed Up Relationship with Investment Risk
Created: May 11, 2016
Categories: Article, Behavioral Finance, Breaking News, Economics, Evidence-Based Investing, General Audience, Scary Market Insights
Description: As we swing into another summer of global events (such as the Cdn. Fort McMurray wildfire, UK Brexit and US elections), this article presents ways that investors tend to overestimate, underestimate, misunderstand and mistreat investment risks (both return-generating market risks as well as avoidable concentrated ones). Use this 1,000-word piece to explain investment risks to prospects and clients alike. Break each section into a series for video scripts or other uses.
January Q4 2015 Client Letter (Peek-a-Boo Markets)
Created: January 4, 2016
Categories: Advisor Role/Value, Behavioral Finance, Client Experience, Client-Focused, Evidence-Based Investing, Quarterly Client Letter
Description: This 420-word year-end client letter observes that 2015 markets were like a game of peek-a-boo with respect to global returns. It reminds clients how "recency" can trick them into making the wrong moves at the wrong time, and why it's important to stay invested in their personalized, evidence-based, globally diversified portfolio.
Advice That Adds Up During Down Markets
Created: October 14, 2015
Categories: Advisor Role/Value, Behavioral Finance, Breaking News, Client Experience, Client-Focused, General Letter/E-Mail, Scary Market Insights
Description: Here is a 700-word piece you can use to remain in touch with clients who may still be nervous after receiving their third-quarter report during the current down market. It encourages them to stay the course with their carefully planned portfolio, already designed to endure market risks. It reminds them why this is your advice, and how an objective third-party can help them overcome their instinctive reactions to down markets. Use as follow up to your clients' third quarter reports or to reach out to clients or prospects in general. It could also serve as good narrative for a video.
October Q3 2015 Client Letter (Google Hits vs. Long-Term Investing)
Created: October 3, 2015
Categories: Behavioral Finance, Breaking News, Client-Focused, Quarterly Client Letter, Technology
Description: This 470-word article looks at how popular Google results, similar to other forms of headline news, may distract investors from their long-term strategy. It provides salient recent quotes on the importance of remaining disciplined during market uncertainty.
Three Key Investment Strategies Hidden in Plain Sight: #1 – Being There
Created: July 26, 2015
Categories: Article, Behavioral Finance, Client Experience, Evidence-Based Investing, General Audience, Three Key Strategies
Description: This 800-word piece represents part one of a series covering three essential evidence-based investment strategies: market participation ("being there"), managing market risk (diversification) and controlling costs. It also emphasizes the benefits of having an evidence-based advisor to assist. Use the series for drip marketing via e-newsletter, e-mails, mailings or as video script for prospective or existing clients.
Avoiding Tracking-Error Regret
Created: August 13, 2013
Categories: Advisor Role/Value, Article, Behavioral Finance, General Audience
Description: This 630-word article defines tracking-error regret in approachable terms, and describes that one of your key roles as an advisor is to help your clients recognize and avoid succumbing to it. It defines tracking-error regret that occurs when an investor’s carefully designed portfolio underperforms its common benchmark. It offers a different (better) way to measure financial success — by focusing on personal goals and constructing the portfolio accordingly. It also offers a handy table that summarizes the key tenets of disciplined investing.