After bursting on the financial services scene following the 2008 crash, distributors now face their own full-fledged market crisis. Amid the volatility and uncertainty, following are some emerging themes arising from the coronavirus’s impact which will help distributors to sail through
Short-term asset allocation shift and long-term perspective
Given the recent market downturn, some investors are moving to less-risky asset allocations, like bond ETFs, to avoid downside risk. These are market expectations, and those same investors will likely also consider returning to equities when the market bounces back to capitalize on market gains. There is often a disconnect between long-term investing and short-term economic reactions in economic downturns like this one. Historically, disciplined and experienced investors’ portfolios have benefitted over time due to their measured long-term approach.
Human communication with clients is key:
All distributors are spending time guiding coronavirus-impacted clients — both personally and economically. Even with a high level of digital interaction, clients frequently feel best-served by human advisors in uncertain market circumstances. Digital channel like email, video calls have replaced physical meets. These channel provide a human touch needed to ease client’s anxieties during troubling times.
In such times, the need for distributors to manage their business with a technology support is highlighted to ensure that no what the outcome, the present working style of a distributor and the engagement with clients are not interrupted by the on-going market/economic conditions. It is in such time, technology becomes the biggest asset and the best investment done by a distributor to safeguard their business by a third-party affect.