Did you ever feel really alone? I mean like you see the world one way and EVERYONE else sees it a different way. It looks to me like everyone in the wealth management industry has fallen head over heels in love with bigness. It seems like a new list celebrating the biggest firms is published
Scott’s Column
Posts for Category: Scott’s Column
The financial advisory business has a lot of rules about how we are supposed to treat clients. We have the basic fiduciary standard under the Investment Advisers Act. We have the DOL’s fiduciary standard. We have Reg BI. We have know-your-customer rules. The list goes on. Recently, the SEC
Lately, I’ve read quite a few articles about the potential of artificial intelligence (AI) to boost the performance of investment portfolios. The pony ridden by AI is off to a bad start in that race. A June 2nd article in Yahoo Finance points out that the AI Powered Equity ETF (AIEQ) has a 1-year
When markets decline, client anxiety increases. The correlation between the two never varies. Last year was a good example. Stocks down. Bonds down. Client anxiety was very high. The cause of this anxiety is mainly attributable to one thing. We hate uncertainty. Our brains crave certainty. In fact,
I turn 72 tomorrow. Many of my contemporaries have already retired and many more are plotting their “exit strategies.” Not me. I love this stuff. Sometimes I wonder if there’s something wrong with me. Shouldn’t I be yearning for the easy life where I can do whatever I want whenever I
There’s no such thing as Easy Street. A small group of us launched First Ascent a little over seven years ago with the goal of creating the best TAMP for RIAs who want a team of experts to manage portfolios for their clients. We had no track record, clients, or outside financial backing. Who’s c
Successful long-term investors have one thing in common. Patience. Good things take time. Close relationships. Building trust. Growing a family. Learning a craft. The Green River you see in the photo took 300 million years to carve its way through the Canyonlands outside Moab, Utah. It’s breathtak
Each of us is on this earth for a very short time. Barely a blip on the radar screen of history. But that doesn’t mean we can’t make a difference. I was riding my bicycle through Death Valley earlier this year and came across a place called the Artist’s Palette. It is a beautiful patchwork
The SEC Outsourcing Rule: What Happens When Advisors Fail as Fiduciaries
The SEC recently proposed a new rule designed to ensure that advisors live up to their fiduciary duties when they outsource. The proposed rule is quite broad in scope. It covers not only outsourcing to TAMPs, but also outsourcing to a range of other service providers. The proposed rule requires ad
Our Greatest Gift to Our Clients
Ouzel Lake in the Wild Basin area of Rocky Mountain National Park is a peaceful place. Especially on an early Fall morning after the first snowfall. My wife and I reached it on an icy trail surrounded by waterfalls and beautiful views of the rugged mountains that define the edges of the Wild Basin.
Don’t Believe the Pundits—Small is Beautiful
Pundits keep predicting that big will “dominate” small in the financial advice space. I ain’t buyin’ it. The big wirehouses have been around forever and they have been losing ground not gaining it. Mark Hurley predicted decades ago that the independent advisory business would consolidate int
I returned to the scene of the crime last weekend–the Manitou Incline. The Manitou Incline is a beast. It’s a stairway that rises over 2,000 vertical feet straight up the side of a mountain in less than a mile. (It’s 1,454 feet to the top of the Empire State Building.) In September, I cl
The Relationship Between Direct Indexing and Active Management
Last month I described what direct indexing is and how advisors might use it to satisfy specific client needs. This month I want to briefly explore the differences between direct indexing and traditional active management. Is Direct Indexing Passive or Active Management? True index investing—or pa
Direct indexing portfolios are broadly diversified portfolios of individual stocks that are personalized to meet the needs, values, and preferences of an investor. An Index Oriented Approach As its name suggests, direct indexing takes an index-oriented approach to investing. The investor, in consult
Here They Come Again—The Soothsayers and Snake Oil Salesmen
Since the stock and bond markets started misbehaving at the beginning of the year, we have been assaulted pretty much non-stop by the usual crop of product-pushers, market timing advocates, and crystal ball gazers. Do yourself a favor and ignore them all. In 2006 Philip Tetlock published his 20-year