When looking at the way people should manage their wealth, some people don’t choose wealth manager based on just performance. Why would you do that? There are several reasons. First, there is a psychological belief that people who have had bad experiences with a financial planner will not do as well managing their own investments.
But the real reason to not choose wealth manager based on just performance is because of the other factors involved. Let’s assume that you don’t have a good experience with your financial planner. It doesn’t mean that you shouldn’t choose a planner. You may choose another one. There are many people that have had bad experiences, but that doesn’t mean that they are bad investment managers.
If they were poor investment managers, they would never have been able to achieve the level of success that they have now. They may have chosen a different financial advisor, or they may have tried a different product. But no matter what, those products and advisors would not have performed as well as the planners that they have now. So you should definitely choose wealth manager based on just performance.
When you don’t choose wealth manager based on just performance, you’ll get a mix of portfolios which have very good investment performances, but they aren’t very useful. You’ll have a mix of high-risk products, but you won’t be able to find any products that have a lower risk level. You’ll also end up with some high-risk products, and some low-risk products. There is really no way to have a balanced portfolio.
In the early days, people didn’t necessarily know that they were investing in a balanced portfolio when they didn’t choose wealth manager based on just performance. And that’s exactly what happened. People didn’t understand how important it was to find an advisor who could show them that investments were good, and which were bad. They just followed the advice of the salespeople and brokers, and never learned anything about building a diversified portfolio. This is why you see so many people today trying to achieve a balance via stock market or bond investing, without learning anything about building their own retirement wealth management plan.
So, if you really want to make sure that you don’t end up with a portfolio that’s too risky, and you really want to ensure that you get a high percentage of your investment back, then don’t choose wealth manager based on just performance. You must have some idea about how your money is being invested. Otherwise, you won’t know what risk level you need to be at. And you certainly won’t be able to figure out what percentage you should be at to get a certain return. This is why the best advisors are the ones who show you what your risk tolerance is, and then build from there.
Now this doesn’t mean that there aren’t some advisors who do provide a wealth manager software package with all of this information. You just have to be careful about choosing them. You will want to avoid any advisor who recommends you buy a particular risk tolerance first and foremost. This is a mistake that most people make, because it leads them into a situation where they’ll be over- diversified in a bad market, and thus it will be difficult to make a profit. But you must also avoid the advisor who recommends that you buy high performance stocks only to recommend that you wait a few years for these stocks to perform.
The point is that you need to look for other things than just the performance numbers when choosing a wealth manager. This is one area where experience truly counts. An advisor who has been around for a while will understand how things work in the market, and he’ll be able to provide you with a good strategy. And you’ll need to be sure that your strategy makes sense. It’s a little like buying a car: you might not need a fancy sports car, but you want one that gets good gas mileage!