ARE ROBO-ADVISORS RENDERING INVESTMENT MANAGERS OBSOLETE? // INVESTING
“FIND AN ADVISOR THAT HAS COMMITTED TO EDUCATION; LOOK FOR DESIGNATIONS SUCH AS CFP OR CFA, BUT ALSO LOOK FOR AN ADVISOR THAT ACTUALLY PROVIDES FINANCIAL ADVICE, AS OPPOSED TO JUST SELECTING INVESTMENT PRODUCTS.” ~ MARSHALL MCALISTER
picture. There are no ‘one-size-fits-all’ plans at Pavilion— especially with some of the complicated financial lives of some of our clients.” McAlister credits Pavilion’s combination of scientific investment strategy, tailored portfolio construction, and longterm relationships, as well as their ability to connect wealth planning to the tax and legal advice of other professionals, for the success of the company—and their clients. “While the majority of fees in the industry are charged based on specific investments made, we feel that the most valuable service provided to investors is advice that includes the planning and the structuring of their financial affairs, which should happen before any specific investments are recommended, as well as monitoring and oversight, which is ongoing. There is much more to financial advising than picking stocks, bonds, or funds. Items such as preparing a financial plan, constructing a proper asset allocation, ensuring that assets are properly allocated across accounts to maximize after-tax returns, monitoring and re-balancing investment portfolios, and reporting progress on a regular basis generate value for investors. Further to that, items that transcend investing, such as family risk management, estate planning, and philanthropic support, provide clients with
financial as well as emotional value, and it is hard to place a dollar value on that piece of mind.” McAlister’s advice for finding an investment manager? “Find an advisor that has committed to education; look for designations such as CFP or CFA, but also look for an advisor that actually provides financial advice, as opposed to just selecting investment products. Fund management is a tool that is used as part of an overall solution, but it should not necessarily be the sole service provided. When investment solutions are proposed in the absence of the full understanding of an individual’s circumstances, wants, and needs, they run the risk of not delivering the desired outcome for the investor.” Russ Dyck, co-founder and financial planner at Finovo, explains how robo-advisors can actually be credited for founding a new way to look at financial planning. Finovo is a new, fee-only, Alberta-based financial planning partnership that works with young professionals. “We are a virtual firm and have clients throughout Alberta, including Edmonton,” Dyck explains. “We meet with clients via video calls since our clients’ schedules are often filled with work and family responsibilities. Video calls give our clients the convenience of meeting us wherever they are and not wasting their time on travel.
ABOVE: MARSHALL MCALISTER, CFA, PRIVATE WEALTH COUNSELLOR AND PRINCIPAL, PAVILION INVESTMENT HOUSE.
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FEBRUARY 2018 // BUSINESS IN EDMONTON // BUSINESSINEDMONTON.COM