October 19th, 1987 might just seem like any other date to most people, but for investors it is a day marketed by fear. On that Monday morning in October, the stock market felt one of its worst slumps in history. The world market was hit in one swift strike, starting in the East in Hong Kong and sweeping across Europe and the rest of the West. Markets in Asia dropped close to a staggering 40%, in North America the Dow Jones Index fell by 22%.
Any person with investments at this period of turmoil would rightfully have been at unease, and it is moments like those where the services of a financial advisor comes into play the most.
A study conducted by Vanguard found that almost 50% of the work a financial advisor does is actually “hand holding”. Consulting with a financial adviser about their position on the market and your portfolio (especially during moments of uncertainty) can be the extra edge needed to get the best returns. Advisers have the advantage of removing the emotional factor from decision making and should be in a better position to determine whether to hold onto assets or move them and if moved, then what sectors they should be reallocated in.
In the same study conducted by Vanguard it was found that having a financial advisor adds 3% of cumulative wealth more per year than going alone. At first glance 3% does not seem like a whole lot, but when you take in to account that your portfolio might have a life time of up to 30 years that 3% turns into an additional 40%! (Ignoring the impact of compounding interest!).
Overall in our world today any event can shake the economy, and it is ever more so of the upmost importance to acquire the services of a financial adviser, as consumer behavior (Primarily subjective and emotional) is the biggest factor holding investors back from obtaining their target saving goals.
Finding an adviser you feel comfortable with - especially the "trust" factor - can be the biggest challenge. At Just Service you will find we have experienced and qualified advisors who focus on servicing existing plans rather than trying to sell new financial products.
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Just Service Hong Kong is a member of the Hong Kong Confederation of Insurance Brokers in Hong Kong, transacting Long Term (including linked long term) Insurance business. Nothing in the comments above should be taken as offering investment advice or making an offer of any kind with regard to financial products or services of any kind. It is therefore important to reinforce that all comments above are designed to be general in nature and should not be relied upon for considering investment decisions without talking to licensed advisers.