ADVISOR MARKETING

Susan Theder

Elections make people nervous . But these five strategies will help you calm clients .

S A FINANCIAL ADVISOR , YOU MAY FIND THAT CLIENTS BEcome increasingly anxious about market volatility during election seasons . While it ' s not necessary to constantly discuss elections , having effective communication strategies in place can help ease client worries and reinforce their confidence in your guidance . Here are five proactive approaches to consider :

1 . Create A Focused Content Resource

One thing you can do is develop a comprehensive " Election and Markets " guide that can be shared via email or your website . This resource should address common client concerns and highlight historical data showing the lack of a significant correlation between election outcomes and long-term market performance .

Key points to include :

• Data from Vanguard shows that since 1853 , stock markets have trended upward regardless of which party controls the White House or Congress .

• Research from BlackRock indicates that over the past 120 years , the S & P 500 has returned 9.9 % annually under Democratic presidents and 6.1 % under Republican presidents , emphasizing that markets have grown under both parties .

• A study by the CFA Institute found no statistically significant difference in stock market returns based on the political party of the president .

You can format this information as a concise report or infographic , making it easily digestible for clients . This approach not only informs clients but also positions you as a knowledgeable resource during uncertain times .

2 . Use Visual Communication

Visual aids can be powerful tools for conveying complex information simply and effectively . So you ’ ll want to make use of charts and graphs to illustrate key points about market performance during and after election years . For example :

• Create a chart showing the S & P 500 ' s performance across different presidencies , highlighting the long-term upward trend , regardless of the party in power .

• Use a graph comparing the performance of staying invested versus moving to cash during election cycles to demonstrate the potential risks of making drastic portfolio changes because of a political event .

• Consider using resources like YCharts to create customized visuals with your firm ’ s branding . These visuals can serve as effective conversation starters in meetings or as supplementary materials in your communications .

3 . Personalize Communication For Anxious Clients

While broad communication strategies are essential , personalized outreach can make a significant impact on clients who are particularly worried . For these clients :

• Schedule one-on-one conversations to discuss their specific concerns in detail .

• Review their long-term financial plan and explain how it is designed to weather various political and economic scenarios .

• Share relevant historical data during these conversations to provide reassurance . For instance , emphasize that markets have shown resilience following elections , often rebounding quickly after initial volatility .

• Remember to keep them focused on their long-term financial goals rather than reacting to short-term political events .

4 . Develop A Comprehensive FAQ Resource

Create a dedicated election FAQ page on your website that addresses common questions clients may have about the election and its potential impact on the markets . This resource should include :

• Insights on historical market performance during election years ;

• Data demonstrating the lack of correlation between election outcomes and long-term market trends ;

• The risks associated with moving to

20 | FINANCIAL ADVISOR MAGAZINE | OCTOBER 2024 WWW . FA-MAG . COM