Why investors often lose when they sue their financial adviser
The need for a financial advisor in the world of business and investment is highly controversial. Half of the investors believe that they do not need any help, they know everything and will cope with any difficulties. But, for example, even the largest investment companies, like representatives of the jkr official site, have a person who accompanies all financial transactions and controls their legality.
Why do investors need a financial advisor?
The process of forming an investment portfolio can be difficult for some investors. Designing, implementing in practice, monitoring, rebalancing, resolving tax issues, and periodically re-evaluating a strategy takes a lot of time and effort. It is even more difficult to keep track of the constantly changing market situation, which is influenced by a variety of events, from internal corporate decisions to the global policy of state governments and global financial organizations.
Not everyone has enough free time to seriously deal with all these issues, and even if they do, they are not necessarily ready to devote most of it to investment research.
If an investor is not ready to manage his portfolio or wants to focus on his main activity, then a good solution to this problem is to attract a professional asset manager.
A competent manager can:
- help to form a suitable option for the distribution of assets in the investment portfolio;
- to translate the investment plan into practice;
- monitor;
- rebalance;
- if necessary, redistribute assets in connection with the market situation, as well as with changes in your plans and life circumstances.
Independent financial advisors have existed for decades in the United States and European countries. The lack of attachment to a specific organization and a specific line of products is a key advantage of an independent financial advisor, as it allows him to be completely impartial and act in the best interests of the client.
Why investors can lose when they sue their financial adviser
Certified financial services professionals, many of whom are investment advisors, also voluntarily commit to adhere to a code of ethics and standards of professional conduct that is actively applied in investigative and disciplinary processes. Clients who believe that their financial advisors may have provided conflicting advice may try to resolve the situation by suing the advisor.
If the investor decides to sue the financial assistant, it is important for him to clearly formulate the problem and detail the points that led to such a decision.
Each problem should be spelled out in detail, with attached evidence in the form of documentation or video, photo, or audio recordings.
If in such cooperation the matter comes to court, in most cases the consultant wins and there are reasons for that:
- Lack of details of the problem on the part of the person who filed the claim.
- The presence of personal motives on the part of the investor (conflicts provoked by him).
- Absence of one of the proofs of guilt.
Also, the direct fault of the investor can often become the reason for the loss. For example, there was a transaction in which a financial consultant performed all his work, described all the risks and nuances that could lead to negative consequences, and the investor, in turn, acted ignoring the consultations and this led to losses.
Often in such situations, investors blame their assistant for the loss, arguing in different ways. But in court, after a detailed study of the case, it will certainly become clear that it is the investor who is to blame for the thwarted deal.
