What are the most important factors involved in choosing a professional investment advisor?

We feel both risk management and low costs are two critical variables that should be emphasized when choosing someone to advise you on your investments. Investors should agree with the advisor's investment philosophy and feel comfortable with their quality and method of research and communication, as well as investment style. Here are some critical points to cover with a potential advisor to clarify and establish a solid mutual long-term understanding and relationship.

  1. Know your investment professional's experience and philosophy of investing.
  2. Make sure there is a communication and personality fit between you and your advisor.
  3. Ask if they have specific investment strategies designed to help and protect you during current market conditions.
  4. Ask and understand how your investment professional is compensated.
  5. Be honest about your current financial situation, goals, objectives, and risk tolerance.
  6. Ask about the services and limitations of your investment advisor.
  7. Schedule a regular financial check-up, to make sure you are on track or to make adjustments.
  8. Call when circumstances in your life change that may impact your investment strategy.
  9. Examine investment performance history, being sure to compare results obtained under particular market conditions, not just over a particular time frame.
  10. Be realistic in your expectations regarding the returns expected on your account in light of the overall performance of the broad market indices and your risk considerations.