Most Advisors Caught Failing Clients in Research ‘Sting’ (AdvisorOne)

In an undercover audit of Boston-area financial advisors, three economists wanted to find out if financial advisors undo or reinforce the behavioral biases and misconceptions of their clients. “We document that advisors fail to ‘de-bias’ their clients and often reinforce biases that are in their interests,” the authors found. Sponsored by the National Bureau of Economic Research, Harvard economist Sendhil Mullainathan, Markus Noeth of the University of Hamburg and Antoinette Schoar of the MIT Sloan School of Management hired actors to pose as clients and display self-defeating investment behavior. The study focused on retail advisors at the lower end of the wealth spectrum and did not include private wealth managers or hedge funds. The specific firms and advisors were not named.

Read the story.

Related Variable Resources

Powered by

  • Generation X and Millennials want this annuity ... and you should too.

    Whether you're selling to the traditional annuity market, or the overlooked Millennial and Generation X market, the safety, guarantees and astounding index credit offer all the market potential, without the risk. Watch this 2-minute video to learn more.

  • Construct Your Own Path To Success!

    There is never one path to success, but many, and we can show you all of them. Our Pathfinder will guide through the exploration of how EXACTLY you can take your practice to new heights. Watch the video now!

Comments

Advertisement. Closing in 15 seconds.