“Providing Transparency in Alternative Investments: The Importance of the Advisor-Client Relationship”, is a new white paper that discusses investment transparency, the hot topic in the world of managed futures and hedge funds.
Transparency builds stronger interactions and understanding between advisors and clients in the long-term pursuit of investment returns. More than just providing a performance statement, transparency starts with the relationship and sets appropriate expectations for both parties.
Written by Mark Shore, Adjunct Professor of Managed Futures at DePaul University and Research Principal of Shore Capital Management, this important white paper comes at a time of negative press coverage on the performance of and transparency in alternative investments. One opinion is that managed futures and hedge funds require additional transparency, when in fact they may have greater transparency then initially perceived when properly understood.
The goal of investment transparency is to eliminate the possibility and potential for pretense or misunderstanding by making investments easily understood; so that all aspects are visible and clearly defined to both the advisor and investor. This white paper recommends implementing six key factors for ensuring investment transparency: 1) on-going client communications, 2) setting expectations, 3) talking about fees, 4) explaining diversification, 5) understanding and monitoring portfolio performance, and 6) accessing real-time performance information.
“It may seem obvious, but an advisor should set proper expectations for an investment from the very beginning. Defining investment goals such as pursuing returns aggressively or providing portfolio diversification is just one key factor to creating great relationships with clients,” said Shore. “If expectations are properly met, clients have a better understanding of both profits and losses within a portfolio, creating investors who understand the objectives set and are able to ride the ups and downs inherent to any investment. Also, while transparency starts with a strong advisor-client relationship, technology often facilitates that relationship by illuminating data that helps both parties monitor and make informed decisions about investment strategy.”
“This paper came about because Mark and I were discussing the perceived lack of transparency in managed futures and hedge funds, and more importantly, how it can be resolved,” said Shane Stiles, President of Gate 39 Media. “In working with a diverse clientele of brokers, RIAs, and wealth managers I’ve seen how successful firms provide transparency and have a generally happy and successful client base. The leading solutions I’ve seen are grounded in advisors having great relationships with their clients and using technology. Web-based technology such, as our Clarity Portfolio Viewer provides investors with transparency through clear and comprehensive performance reporting and analysis on an entire portfolio and its components. Enabling investment transparency through technology is a critical component of a strong, long-term, and successful advisor-client relationship.”
“Providing Transparency in Alternative Investments: The Importance of the Advisor-Client Relationship,” is published by financial marketing and technology specialists Gate 39 Media and can be downloaded at www.gate39media.com/investment-transparency.
ABOUT MARK SHORE
Mark Shore is Chief Research Officer of Shore Capital Management and Adjunct Professor of Managed Futures at DePaul University. Mark Shore has more than 25 years of experience in the futures markets and managed futures, publishes research, consults on alternative investments, and conducts educational workshops. Learn more at www.shorecapmgmt.com or contact info@shorecapmgmt.com.
ABOUT GATE 39 MEDIA
Gate 39 Media is a financial services web design, development, and marketing agency providing technology solutions for the financial industry. The Clarity Portfolio Viewer provides investors with a clearer and deeper knowledge of a portfolio’s performance, and investment firms with management and sales reporting. To learn more about Gate 39 Media or the Clarity Portfolio Viewer please visitwww.gate39media.com or contact Jill Jackson at 312.715.1475 or media@gate39media.com.