Behavioural finance expert: Clients want anxiety-adjusted returns

Jenna Towler
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Better management of investor anxiety during periods of volatility is essential to helping clients maximise the potential of their investments, delegates at the Personal Finance Society (PFS) heard.

Barclays behavioural finance expert Peter Brooks said advisers should use behaviour economic theory in practice with clients to help them manage the ‘human element' of investing. He said moving clients away from optimal investment models could be part of that strategy, even if it is just a short term measure to alleviate anxiety or stress during times of turbulence. "Education and knowledge are not enough to manage emotional anxiety. Clients want anxiety-adjusted returns. Diversification is not enough, that does not take the human element into account the best returns will minimise an...

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