Let me chime in on the dilemma of an investment advisor, a thread :

Disclaimer: Every advisor has a responsibility to seek further knowledge than what is provided by their broker, they should also have some experience in investing in the stock market for themselves, Monopoly money and real money is vastly different

Globally, Financial Advisors manage equity portfolios starting at USD$100k+. They also exist here but our reality is a bit different in that a customer with JMD$100k can visit any broker and asks to speak to an advisor, and I mean why shouldn’t you?! However an advisor’s

compensation is tied to individual targets. Most advisors are either paid 1) A low/medium base with high monthly commission variable 2) A base with either a quarterly/semi annual/annual bonus incentive. Now what you may or may not know is that commission

is most times is not distributed evenly across product lines,different product lines attract higher commission/incentive and MOST times barring maybe Mayberry the commission earned on stocks is lower than every other product because brokers simply earn less

from the sale or purchase of a stock in the mass market. Unit trust, structured notes for eg provides recurring revenue in the form of management fees /spread so the broker will place the higher commission on whatever makes the business more money - fair enough.

Let’s forget about the commission for now, if an advisor doesn’t make their target they most times will end up being fired, anybody in sales knows that it’s a cut throat industry and you are only good as your last cut which is why most people shy away from sales related jobs.

You may ask so what are the targets like? Well targets range from $50-100mil NEW funds per month depending on the company with $70mil being the median. What this simply means is that an advisor’s bread and job is always at risk and are no different from any human who

places more effort on what will make him/her more money. An advisor often times has a fair amount of administrative work also, so between trying to get paid and fending for their job one has to make a tough decision.

Spend their time prospecting affluent people who can invest a couple millions at the click of a finger to make their $70mil monthly target or spend the time advising persons with 10,20,50,100k which stock to purchase. The sad reality is that traditionally, investing was never

set up for the everyday man, and that’s the decision most advisors are faced with on a daily basis.

There was a time in my advisory days when frankly if you didn’t have JMD$5mil minimum to invest, I would refer you to another advisor with lower targets why? The monthly target was $120mil .

I do however believe that the standard for advisors have fallen the knowledge base lacking and they can and must do better. I’m ashamed to admit that it took months to find two good advisors, many interviews after.

Brokers must also invest more in knowledge based training for their advisors, right now it’s more skewed towards selling skills. Do not despair #FinanceTwitterJa is doing a fantastic job in educating the masses, but remember that as a client you should also seek knowledge.

This is the reason why the brokerage landscape is changing globally with the advent of successful fintech companies like robinhood & stash that exist to make investing easier for the everyday man. Who knows, maybe one day Jamaica will produce one such company.