The 2005 Merrill Lynch Capgemini World Wealth Report stated that investors with as little as $25 million usually have about three advisors on average. It further said that having as few as three advisors became overwhelming for investors to manage.
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The number of advisors investors have increases as their assets increase. They need you to coordinate their team of advisors for them. They need someone to make sure each member of the entire team is focused on achieving the investors’ goals and not honed in on applying his or her particular expertise.
The role of chief advisor or quarterback is to be a liaison between the investment strategy and the advisors implementing it. Further, it is also to keep clients up to date with what’s happening in their portfolios and to ensure that the actions of one advisor are complementary to those of other advisors on the team.
A chief advisor can also help clients evaluate offers from private banks and wealth managers trying to build market share by offering so-called family office level services.
Often, these offers are not truly reflective of family office level service and are designed to attract high net worth investors while failing to give them the experience they expect.
Chief advisors can help investors conduct due diligence needed to fully vet these offers.
Such an advisor may or may not be able to influence specific investment decisions but may be able to offer valuable guidance over allocation within the overall portfolio.
The findings of the 2005 World Wealth Report were recently confirmed by a Spectrem Group Study. In 2012, over 41% of investors with $25 million or more in investible assets had a minimum of three advisors.
A valuable chief advisor can be an effective filter that helps clients discern which advisors would be the best members of his or her team. The chief advisor can monitor performance and the advisor’s ability to work as part of a team to ensure the client’s goals are met in a way that meets the client’s criteria, not those of an individual advisor.
Becoming a chief advisor is a differentiator in a marketplace scrambling to boost margins. Quality will win out over quantity. This is evident in the demising market share
of large financial institutions over the past several years.
It's a trend that is growing and even investors with less than $25 million may need this kind of help, depending on the complexity of their situations.