More Conversation, More Respect
The impact of the coronavirus on the portfolios of investors comes from the way the stock market reacted to calls for citizens to shelter in place or quarantine themselves. Businesses suffered greatly, corporations and industries dealt with shutdowns and reduced staffing, and almost everyone’s net worth took a hit.
But the impact on investor portfolios also had an impact on advisor-client relationships. Some investors reacted nervously to news of the stock market decline, while others took the long view and chose to wait out the economic stress. Some investors needed to be consoled and advised by their advisor while others requested no solace.
But there turned out to be one relatively consistent outcome from the effects of the coronavirus as it relates to advisor-client relationships; most investors were pleased to receive communication from their advisor, and the more communication they received, the more pleased they were.
When it became clear the coronavirus was going to overwhelm the country’s health systems and economic situation, Spectrem began surveying investors about their concerns and attitudes toward the way the virus has impacted their net worth, as well as how their advisors have handled the matter with them. Corona Crash: What Advisors Should Be Saying To Investors Now determined that the more often an investor speaks to his or her advisor, the more respect that advisor gains from their client.
Investors were asked in the first two weeks of April how often they had spoken to their advisor since the coronavirus first started impacting the stock market back in February. Those same investors were asked if their respect for their advisor had grown during the crisis as a result of the way they have communicated with their client and handled portfolio matters.
Overall, 42 percent of investors said their respect for their advisor had improved as a result of their communication during the first two months of the coronavirus pandemic. However, the more often an investor heard from their advisor, the more likely they were to say their respect had grown. Among those investors who had hear from their advisor twice, 49 percent reported increased respect, and among those who had hear from their advisor three times or more, 54 percent reported greater respect for their advisor.
And among those investors who had not had a conversation with their advisor during the first two months of the pandemic, only 19 percent reported improved respect for their advisor. It is uncertain why their respect had grown in that situation.
Communication is always considered one of the key components of a successful advisor-client relationship. That apparently is true now more than ever.
Keywords: coronavirus, investors, advisors, Spectrem, respect, communication, corona crash