More finance stuff

A column in Financial Advisor Magazine advises money managers to:

Simply stated, the more heavily armed you are with statistical demonstrations of your essential theses, and the more reliant on those “proofs” you are in your interactions with prospects and clients, the less likely I believe you are to forge lasting relationships built on trust. And, failing to found your relationships on trust rather than on “evidence,” the more your practice is built on sand, and the less likely it is to endure and prosper."

So how do you build trust/confidence in making money (or anything) without quantitative proof of what your selling. Actually, I think this shyster's point is that if you show someone the numbers, they will realize they don't really need a manager/advisor. The biggest role they can play (not that all do) is the focus on sticking to a play and helping to reduce panic.

Of course commission compensated agents play some role in the 7% gap referenced in the column by churning clients from "underperforming funds" to the "hot funds", which, curiously, often become the underperformers.

The Four Pillars of Investing has a chapter called "the Broker is not your Buddy". Very apt.