Wealth Advisor, Forrest-Wood Private Wealth Management, ScotiaMcLeod
St. Catharines, Ont.
In the business
$185 million across 370 households
I never get attached to stocks. I learned that in the ’90s, when I put my own money in a renewable batteries company. The stock fared poorly, but I tried to average down and bought more. When I finally got out, I had been singed worse than if I’d left earlier. That experience helped me to empathize with clients who find it difficult to take small losses. Whenever we acquire or sell a position, we explain our rationale. For example, when Agrium started trading around $107, we decided to sell. The stock had grown past its target price, and was exceeding the intended portfolio percentage. We explained how Agrium is cyclical, based on the growing season, and given that demand for nitrogen fertilizers was slowing, we’d decided to take a profit. It currently trades near $100.
Finger on the pulse
We hold several seminars, including one on identity theft. We had to organize it twice this year to accommodate demand, with more than 50 people attending each time. At both presentations, a forensic accounting partner with Grant Thornton spoke, and we gave each attendee a RFID (radio frequency identification) shielding wallet (each cost about $5).
In 1998, I assumed a wealthy couple in their 70s would never consider mutual funds, and I dedicated the meeting to GICs. The next time I heard from them, they’d made a transfer-out request to a broker who managed mutual funds. I’d assumed that since they were elderly they would be conservative, and that I was looking at all the money they had. This taught me to ask more open-ended questions.
Another time, a client seemed sullen, so I asked how he was doing. Turned out his ill 30-year-old child was moving back home, and he worried it would force him to defer retirement. That information turned our planning on its head. We discussed treatment costs and home modifications, as well as funding sources. We’re now modelling two scenarios: retiring on the original goal date or working another two years.
Disclaimer: Within the last 12 months, Scotia Capital Inc. may have undertaken an underwriting liability with respect to equity securities of, or has provided advice for a fee with respect to, Agrium.
Originally published in Advisor's Edge
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