Page 19 - Newcom

investments
Client coaching
by Mark Burgess
for the 24-hour news cycle
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Here’s a story: a few years ago, a Fidelity study
found the firm’s best-performing portfolios belonged to people who forgot they had accounts. In some versions, the account with the best performance belonged to a client who was dead.
Here’s a story about that story: it’s not true. The apoc- ryphal tale originated with an anecdote on a podcast that was then reported in the business media. Efforts to track the anecdote to its source turned up nothing, and Fidelity has denied producing the study.
There’s something morbidly appealing about a corpse outperforming the active minds tinkering with portfolios to their own detriment. Maybe that’s why the story itself won’t die. The tale was recounted at a Toronto event last year, and Fidelity acknowledged it still
receives inquiries about the “zombie” study.
tweets will be posted. Every two days, we create as much information as we had in human history up until 2003, according to former Google CEO Eric Schmidt. And he said that 10 years ago.
“We’re in some sort of information overload,” says Craig Basinger, chief investment officer and portfolio manager at Richardson GMP in Toronto.
News travels faster than ever and often comes in bursts on a particular topic, he says. This creates a rush to respond as investors update their opinions and valua- tions while trying to absorb the new information. This can lead to overreactions.
David Lewis, chief client officer at BEworks in Toronto, says the internet has also compromised the idea of
The story weaves together two threads central to wealth management: there’s more news than ever before to consume, but not all of it is helpful, let alone accurate; and it’s extremely challenging to prevent clients from acting on this flood of information.
The amount of data produced in a day is staggering. Roughly 300 billion emails will be sent in the next 24 hours, and 500 million
“An investment portfolio is like a bar of soap: the more you touch it, the smaller it gets”
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