If you’re looking to begin investing, or want to improve the performance of your existing investments, a great place to start is by promptly and effectively communicating with your advisor.
Capital markets change frequently, with new risks and opportunities cropping up, often without much warning. Whether caused by a company’s earnings report or an announcement from the Reserve Bank, you may not be well-equipped to respond to the volatility on your own.
With timely communication, a financial advisor can help you make the right decisions during those critical moments and adjust long-term strategies to ensure strong investment returns.
At PCR Accounting & Advisory, we know from experience how important an effective communication channel is for creating and executing a successful investment strategy.
It’s a two-way responsibility: financial advisors should follow up regularly while clients should fill out any requested questionnaires, provide relevant documents, and licensees and signatures as quickly as possible.
Here are the three biggest reasons why prompt communication with your advisor is essential for strong returns.
1. Effectively Manage Risks
Risk management in investing is not a one-and-done deal; it requires constant reassessment and adjustment as market conditions change. To understand and effectively manage risks, it’s important that you stay in touch with your advisor.
Initial advice from weeks or months ago may already be outdated and no longer relevant to prevailing market conditions, creating unnecessary risk exposure. Having up-to-date information and advice from your advisor helps you figure out where you may be overexposed and take the right actions to protect your investments.
It’s also important for clients to share life changes that may impact their investments such as an upcoming retirement, a job loss, business challenges or a financial emergency. Your advisor can then help you adjust your portfolio to reduce potential risks before they escalate.
2. Navigate Market Volatility
Financial markets can change at a moment’s notice due to policy changes, economic reports or even natural disasters. While most investments call for a long-term outlook (that’s because most assets bounce back from temporary dips and experience an overall increase over time), that doesn’t mean you completely ignore current volatility in the markets.
Prompt communication with your advisor regarding ongoing or expected fluctuations ensures you are not blindsided by major shifts. With your advisor’s guidance, you can decide whether to take action on any particular assets in your portfolio, sit back and ride out the volatility or adjust your long-term strategy.
Talking to your advisor is particularly critical to helping clients avoid hasty decisions they might make in panic during periods of volatility.
3. Capitalise on Time-sensitive Opportunities
Another reason to keep your advisor on speed dial is so that you can act quickly when windows of opportunity occur. Some investment opportunities like IPOs, tax-efficient investments, SPACs (Special Purpose Acquisition Companies), and high-yield bonds need you to act fast or within a specific time frame.
Maintaining open lines with your financial advisor ensures you don’t miss out on these opportunities.
Grow Your Investments With PCR
At PCR, we are more than just accountants and financial experts; we are your partner. Prompt communication with your advisor will help us help you. Open, timely and consistent communication is the foundation of our partnership with our clients, which is why we follow up regularly and provide updates to help you make the right investment decisions in a timely manner.
So, make sure you make the most of your investments by getting any relevant documentation back to us or answering our questions as soon as possible for the best outcomes.
Contact us at 03 9847 7516 to talk to a financial advisor about growing your investment returns.
Disclaimer: This blog post is for informational purposes only and should not be considered as financial or legal advice. Consult with a qualified professional for personalised guidance based on your specific circumstances.
Owner of PCR Accounting & Advisory, Peter Marmara-Stewart is a top-tier accountant and financial advisor dedicated to helping clients reach their business goals and achieve financial freedom. Peter is highly regarded for his client-focused approach and entrepreneurial spirit, catering to a diverse range of professionals across a wide scope of industries all across the country. Peter’s expertise can help you plan effectively, set goals, maximise profits and protect your assets. Get in touch today on (03) 9847 7516.
