To ensure investment transparency, there are 6 important factors that must be satisfied:
- There must be on-going communications with investors.
- Advisers and investors must agree upon reasonable return expectations.
- There must be an open dialogue about investing fees.
- Diversification must be properly explained and understood.
- There must be constant monitoring of portfolio performance.
- Advisers must provide access to real-time performance information.
"It may seem obvious, but an adviser should set proper expectations for an investment from the very beginning. Defining investment goals such as pursuing returns aggressively or providing portfolio diversification is just one key factor to creating great relationships with clients ... If expectations are properly met, clients have a better understanding of both profits and losses within a portfolio, creating investors who understand the objectives set and are able to ride the ups and downs inherent to any investment. Also, while transparency starts with a strong adviser-client relationship, technology often facilitates that relationship by illuminating data that helps both parties monitor and make informed decisions about investment strategy."- Adjunct Professor of Managed Futures at DePaul University and Research Principal of Shore Capital Management
Many of the leading investment solutions in today's markets are built upon the great relationships that financial advisers have established with their clients. By utilizing technology to enable clear and comprehensive performance reporting and analysis of their entire portfolio, today's investment providers have demonstrated that offering investment transparency through technology is emerging as a necessary component of establishing a strong, long-term, and successful adviser-investor relationship; that produces a great investing experience for all stakeholders.