How to find an Investment Advisor

Do you think you need an Investment Advisor? Hold on before you
answer because this is sort of a trick question. Also, I am
definitely biased because I am an Investment Advisor.
Nonetheless, I think I can assist you in looking at this issue
in a way that will serve you.

Working with a fair number of investors over the last nearly 20
years, I have observed that while most are intelligent people,
and many are fairly knowledgeable about the market, they are, as
a group, not terribly successful with their investing.

Why should they be? More likely than not they have made their
living doing something other than investing, so why would they
think they can do what a professional does better than a
professional? (After all, they go to professionals for health
care or for car repairs when needed!)

Most investors-even some professionals-tend to be "off" in their
timing: they buy things when they are hot, not when they are
cold. But for the greatest benefit, it should be the opposite.
The media doesn't help much when it comes to this buying
approach, and let's face it; greed and fear play a large part in
most peoples' investment decisions.

I truly believe the majority of people would be better of (that
is, they would end up with more money at the end of the day) if
they used professional money managers to advise them on their
investing. Specifically I am referring to Registered Investment
Advisors with proven track records of performance in investing
in stocks, bonds, mutual funds

Let me burst one myth right off the bat: You don't have to be a
millionaire to engage the services of a topnotch advisor. Some
people think you need to start an account with $50,000 or more
to get a really good advisor. Well, you may have more choices if
you're at that level, however you can find very successful
Investment Advisors who will accept opening accounts for as
little as $5000.

There are literally thousands of Registered Investment Advisors
in the US. Just what do they do-what service do they provide
you? They do the legwork; the research and analysis. Maybe more
importantly, they keep their primary focus on the markets, and
specifically on their specialty area like individual stocks,
mutual funds, or bonds.

Because they spend the bulk of their time and energy
researching, considering, and analyzing, they naturally have a
greater sense of the market and its movements than those of us
who don't put this kind of attention into it. So, with the right
advisor, you can keep your focus on what you want-like your
business or your retirement or whatever-and still get the
information you want and need to invest wisely.

How Do You Find The Advisor for You?

Since there are good Investment Advisors and bad ones, how do
you find the former and avoid the latter? Good question, and
there are some keys. Most large brokerage firms list the
Investment Advisors they work with and maintain information
about their past performance. This is not a foolproof resource,
though, since they tend to recommend the Investment Advisors who
invest in their products or clear their business with the firm.
So if you pursue this avenue, you need to watch for conflict of
interest issues.

You can always subscribe to one of the numerous database
services that include information, and sometimes rankings, on
Investment Advisors. These services tend to be fairly pricey,
though, so they may not be your best choice. Another option is
to find articles (yes, like this one) or free newsletters
written by Investment Advisors. If you find one or several that
make sense to you, check out the IA and see if there's chemistry
between you.

When checking out advisors, here are some things to keep in
mind:

1. Verify their record -- look over their past performance; 2.
Consider their system. Will it work in different market
environments?; 3. As best you can, check out their operation
and 4. See if they've had regulatory problems. 5. Equally
important as doing your due diligence is making sure there is
good communication between you and your advisor and that you
trust this person with your money choices.

Another quick free way to scan through a select database and
find a wide variety of candidates is with www.investortree.com
. I'm registered there myself as an
advisor and know that the company did a background check
regarding registrations and regulatory issues.

An important question to ask is the how the advisor gets
compensated. You want to stay away from commission junkies or
salesmen disguised as advisors. I believe that you will get the
best unbiased advice from someone who is paid a management fee
based on the value of the assets that you entrust them with.

To take it one step further, ask if the advisor invests his own
money in the same methodology that he recommends for his
clients. If he doesn't, ask why. If you don't like the answer,
close your check book and run as fast as you can.

Choosing an Investment Advisor can yield long-term high profit
benefits. I encourage you to consider it if you haven't before.
However, as with any relationship, make sure there's a fit
before you jump into it.