Stop Client Dissatisfaction and Grow Your Business

For the past several months we have been surveying advisors about their marketing programs. When we ask them which marketing tools they use, it amazes us that only about 21% use a client newsletter.At a recent conference for financial advisors, we heard from several elite advisors on the subject: One said, “I had an existing client transfer an additional $700,000 IRA account to me after reading an article in my newsletter this spring about the charitable IRA strategy allowed by the Pension Protection Act.”Another said, “We have a top prospect who received our monthly newsletter for almost 18 months before they moved their accounts to us.”We heard from another advisor, “I started with about 100 newsletters a month and now I’m up to over 250. It’s my primary means of marketing. I am averaging over 3 new accounts a month and each new account is over $300,000.”So why don’t you do a newsletter?They don’t work. It’s too hard. I can’t write. I never got around to it. We’ve heard them all. Let’s look at just a couple of reasons why you should make newsletters a core part of your marketing and how you can easily add a newsletter to your marketing without multiplying your staff.1. Clients are dissatisfied.31% of financial advisors believe that their clients are extremely or very dissatisfied with them. 40% of wealthy respondents reported some level of dissatisfaction because their advisor was not proactively maintaining contact and 11% stated that their advisors were difficult to reach.(Phoenix Wealth Management Survey, August 2002, Net worth of $1M+ excluding debt and primary residence; Financial advisors who manage at least $50 million of assets and have 10+ years experience)For advisors intent on improving their showing in this realm, excellent client service appears to begin with a high level of client contact. As a snapshot of the industry standard today, and perhaps an indication of where there is the most room for improvement, nearly half of high net worth investors claimed to be either somewhat or fully dissatisfied with the level of contact they have with their financial advisors. Only 55% of investors stated that they are somewhat or completely satisfied with the amount of contact they have with their primary financial advisors.Satisfied clients hear from their primary financial advisors on average more than 28 times per year, or better than twice per month. This contact can either be in person, over the telephone, or in personal correspondence through the mail or electronically. On the flip side, dissatisfied clients hear from their primary advisors less than 17 times per year.The most telling statistic about the vital importance of client contact is that advisors’ income runs directly parallel with the amount of time they spend speaking or meeting with their clients. Advisors who spend two-thirds of their time with clients have an average income of $160,000 annually. Those who spend between one and two-thirds of their time with clients average $50,000 and those who spend less than one-third of their time with clients average only $30,000.(Tiburon Strategic June 3, 2005)2. Position yourself to KO the competition.Largely due to these rates of dissatisfaction, nearly half of investors have given recent consideration to changing their primary financial advisors. Specifically, 43% of investors responded that they had recently considered a change, whereas 57% stated they had not been considering a change in the near future.(Tiburon June 3, 2005)The landscape is covered with competition. How do you stand out and attract the kind of ideal clients that will make your business thrive? Give the customer what they are looking for. It ain’t rocket science. Clients today are looking for answers. They are smothered with retirement, IRA, estate planning, long-term care planning, college funding and tax issues. This morning your best prospect woke up and wanted an answer to his problems and not a financial product. Give them what they want. You need to be a problem solver. You need to position yourself as the leading expert in your target market. Step One is to tell the audience how you can help them solve their challenges. Isn’t that the point of a good newsletter? It is relevant to the target market in terms of content and it educates them about their financial concerns while demonstrating your expertise in solving those problems. Voila – you are their problem solver.Newsletters made easy.If you are like most financial advisors you have two to three hundred clients in your book. You also know that if you want to make an impression you need to have a consistent process for delivering the newsletter. Finally, you need to make sure the newsletter is getting read, the probability of which you can increase through branding so your clients know the newsletter is from a trusted source. And finally, you need to make a personal connection, so you’d better make sure it’s personally addressed. Oh, did I mention you’ll need to have 3 or 4 articles a month for your newsletter.Before you hit the panic button, there is a solution – BuildYourMarket.com [http://www.buildyourmarket.com] can handle all of this for you. Every month, they create a professionally designed and written 4 color newsletter with content that speaks to boomers and seniors. Each newsletter has a personal message from you addressed to the client or prospect.In case you’re thinking, I’d like to write something about what’s going on in our business, the answer is yes, you can customize as little or as much of the content as you desire.Now what’s your excuse?

SPDN: An Inexpensive Way To Profit When The S&P 500 Falls

Summary
SPDN is not the largest or oldest way to short the S&P 500, but it’s a solid choice.
This ETF uses a variety of financial instruments to target a return opposite that of the S&P 500 Index.
SPDN’s 0.49% Expense Ratio is nearly half that of the larger, longer-tenured -1x Inverse S&P 500 ETF.
Details aside, the potential continuation of the equity bear market makes single-inverse ETFs an investment segment investor should be familiar with.
We rate SPDN a Strong Buy because we believe the risks of a continued bear market greatly outweigh the possibility of a quick return to a bull market.
Put a gear stick into R position, (Reverse).
Birdlkportfolio

By Rob Isbitts

Summary
The S&P 500 is in a bear market, and we don’t see a quick-fix. Many investors assume the only way to navigate a potentially long-term bear market is to hide in cash, day-trade or “just hang in there” while the bear takes their retirement nest egg.

The Direxion Daily S&P 500® Bear 1X ETF (NYSEARCA:SPDN) is one of a class of single-inverse ETFs that allow investors to profit from down moves in the stock market.

SPDN is an unleveraged, liquid, low-cost way to either try to hedge an equity portfolio, profit from a decline in the S&P 500, or both. We rate it a Strong Buy, given our concern about the intermediate-term outlook for the global equity market.

Strategy
SPDN keeps it simple. If the S&P 500 goes up by X%, it should go down by X%. The opposite is also expected.

Proprietary ETF Grades
Offense/Defense: Defense

Segment: Inverse Equity

Sub-Segment: Inverse S&P 500

Correlation (vs. S&P 500): Very High (inverse)

Expected Volatility (vs. S&P 500): Similar (but opposite)

Holding Analysis
SPDN does not rely on shorting individual stocks in the S&P 500. Instead, the managers typically use a combination of futures, swaps and other derivative instruments to create a portfolio that consistently aims to deliver the opposite of what the S&P 500 does.

Strengths
SPDN is a fairly “no-frills” way to do what many investors probably wished they could do during the first 9 months of 2022 and in past bear markets: find something that goes up when the “market” goes down. After all, bonds are not the answer they used to be, commodities like gold have, shall we say, lost their luster. And moving to cash creates the issue of making two correct timing decisions, when to get in and when to get out. SPDN and its single-inverse ETF brethren offer a liquid tool to use in a variety of ways, depending on what a particular investor wants to achieve.

Weaknesses
The weakness of any inverse ETF is that it does the opposite of what the market does, when the market goes up. So, even in bear markets when the broader market trend is down, sharp bear market rallies (or any rallies for that matter) in the S&P 500 will cause SPDN to drop as much as the market goes up.

Opportunities
While inverse ETFs have a reputation in some circles as nothing more than day-trading vehicles, our own experience with them is, pardon the pun, exactly the opposite! We encourage investors to try to better-understand single inverse ETFs like SPDN. While traders tend to gravitate to leveraged inverse ETFs (which actually are day-trading tools), we believe that in an extended bear market, SPDN and its ilk could be a game-saver for many portfolios.

Threats
SPDN and most other single inverse ETFs are vulnerable to a sustained rise in the price of the index it aims to deliver the inverse of. But that threat of loss in a rising market means that when an investor considers SPDN, they should also have a game plan for how and when they will deploy this unique portfolio weapon.

Proprietary Technical Ratings
Short-Term Rating (next 3 months): Strong Buy

Long-Term Rating (next 12 months): Buy

Conclusions
ETF Quality Opinion
SPDN does what it aims to do, and has done so for over 6 years now. For a while, it was largely-ignored, given the existence of a similar ETF that has been around much longer. But the more tenured SPDN has become, the more attractive it looks as an alternative.

ETF Investment Opinion

SPDN is rated Strong Buy because the S&P 500 continues to look as vulnerable to further decline. And, while the market bottomed in mid-June, rallied, then waffled since that time, our proprietary macro market indicators all point to much greater risk of a major decline from this level than a fast return to bull market glory. Thus, SPDN is at best a way to exploit and attack the bear, and at worst a hedge on an otherwise equity-laden portfolio.

S&P 500 Rallies As U.S. Dollar Pulls Back Towards Weekly Lows

Key Insights
The strong pullback in the U.S. dollar provided significant support to stocks.
Treasury yields have pulled back after touching new highs, which served as an additional positive catalyst for S&P 500.
A move above 3730 will push S&P 500 towards the resistance level at 3760.
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Pfizer Rallies After Announcing A Huge Price Hike For Its COVID-19 Vaccines
S&P 500 is currently trying to settle above 3730 as traders’ appetite for risk is growing. The U.S. dollar has recently gained strong downside momentum as the BoJ intervened to stop the rally in USD/JPY. Weaker U.S. dollar is bullish for stocks as it increases profits of multinational companies and makes U.S. equities cheaper for foreign investors.

The leading oil services company Schlumberger is up by 9% after beating analyst estimates on both earnings and revenue. Schlumberger’s peers Baker Hughes and Halliburton have also enjoyed strong support today.

Vaccine makers Pfizer and Moderna gained strong upside momentum after Pfizer announced that it will raise the price of its coronavirus vaccine to $110 – $130 per shot.

Biggest losers today include Verizon and Twitter. Verizon is down by 5% despite beating analyst estimates on both earnings and revenue. Subscriber numbers missed estimates, and traders pushed the stock to multi-year lows.

Twitter stock moved towards the $50 level as the U.S. may conduct a security review of Musk’s purchase of the company.

From a big picture point of view, today’s rebound is broad, and most market segments are moving higher. Treasury yields have started to move lower after testing new highs, providing additional support to S&P 500. It looks that some traders are ready to bet that Fed will be less hawkish than previously expected.

S&P 500 Tests Resistance At 3730

S&P 500 has recently managed to get above the 20 EMA and is trying to settle above the resistance at 3730. RSI is in the moderate territory, and there is plenty of room to gain additional upside momentum in case the right catalysts emerge.

If S&P 500 manages to settle above 3730, it will head towards the next resistance level at 3760. A successful test of this level will push S&P 500 towards the next resistance at October highs at 3805. The 50 EMA is located in the nearby, so S&P 500 will likely face strong resistance above the 3800 level.

On the support side, the previous resistance at 3700 will likely serve as the first support level for S&P 500. In case S&P 500 declines below this level, it will move towards the next support level at 3675. A move below 3675 will push S&P 500 towards the support at 3640.