How to improve portfolio reviews

By Bryce Sanders | October 7, 2013 | Last updated on September 21, 2023
3 min read

Clients often use portfolio reviews as a report card for evaluating the advisory relationship. They compare your “grades” to numbers they see elsewhere and wonder why you aren’t always getting straight A’s.

Read: Why clients leave

Here are 10 ways to handle to the review process.

#1 – Schedule Regular Reviews

Report cards come on a schedule, so should reviews. It demonstrates accountability.

Rationale: When times are bad we are tempted to put off reviews. Bad news often gets worse. We might assume clients doesn’t notice the results, but they do.

#2 – Use Simple Language

Professionals use jargon and tend to assume others understand it. Often they don’t. Even if the client is sophisticated, use expressions like: “Here’s where we started. We added this…We withdrew this…Here’s where we are now.”

Rationale: Clients sometimes think poor performance is disguised by technical terms. Look them in the eyes and plainly explain what’s going on.

#3 – Remind About Withdrawals

Clients sometimes point to overall market percentage gains and remark, “But my account hasn’t moved!” They might forget they took money out to pay taxes or take a vacation.

Rationale: Clients might think in absolute terms. Address withdrawals and deposits within the context of overall portfolio value.

#4 – Develop a Blended Index

Clients often compare their performance to the TSX or the S&P 500, an all-equity measurement. They may hold stocks, bonds and cash, so it’s not a fair comparison. Choose representative indices for each category and blend them proportionately.

Rationale: Clients need to see a fair comparison or discuss each asset class separately.

#5 – Look at Everything

It’s tempting to look at asset classes or sectors, drilling down on individual holdings you or the client suggested. Often there’s a success story. Alternatively, a decline in one holding might be dragging down the entire portfolio.

Read: Follow up without being a pest

Rationale: Optimists look for good news. Isolating the source of the problem might lead to lightening up or adding to the holding.

#6 – How Much Risk Are They Taking?

Your client might have a conservative risk profile that’s mirrored in the portfolio you designed. He might point to the success of the broad equity market and wonder why his portfolio with a 30% equity component lagged. Your equity sector probably did fine. How much risk does he want to shoulder?

Rationale: The decline 4-5 years ago is still fresh in their minds. It’s likely their tolerance for risk hasn’t changed.

#7 – Family Index

Measuring performance vs. indices is a tough game to win because transaction costs and management fees reduce returns. What return do they need to achieve the long-term goals they have set? Position this number as their “Family Index.” Make it the new benchmark.

Rationale: If they are contributing additional assets towards a long-term goal, the necessary return might be modest. A few good back-to-back years may allow you to recalculate the family index downward as they get older and prefer less risk.

#8 – What Have You Done For Me Lately?

Your relationship isn’t just about performance. You might offer advice on lending, insurance coverage and college savings. Maybe a relative needed some free advice.

Rationale: You might be paid on assets or transaction fees, but you offer advice that isn’t performance related. Take credit when it’s due.

#9 – Assets Held Away

It’s likely your client works with other advisors. How are those assets doing? Have they been getting quarterly portfolio reviews like this one? Is her other advisor accountable for results like you?

Rationale: Your client might yell at you because she doesn’t have someone at the other firm to complain to about performance. Those assets might be drifting. You’ve shown accountability. Would those assets be better off at your firm?

#10 – New Ideas

No portfolio is perfect. You might want to add another holding, product or alternative investment. Often clients think about selling something in-house to fund the purchase. It’s likely you want to keep everything in place. Ask them to fund the new idea with fresh cash from elsewhere.

Rationale: Clients often suspect advisors buy and sell to earn fees. Stand behind your previous recommendations. Suggest new ideas and ask for fresh assets. This grows the size of the client’s relationship at the firm.

Read: Turn awkward moments into future business

Bryce Sanders

Bryce Sanders is President of Perceptive Business Solutions Inc. in New Hope, PA. His book “Captivating the Wealthy Investor” is available on