Advisors acknowledge that the most common reason they lose clients is that they are unable to get inside the heads of their clients enough to build solid personal and financial relationships. Understanding how clients actually think and behave is a key ingredient in the recipe for success in acquiring and retaining clients. As such, behavioral finance has become a powerful force in the financial advisory field.

This episode focuses on the Behavioral Investor Types (BITs) model developed author and Financial Adviser, Michael Pompian CFA CFP®. In his work, Michael identified four distinct BITs and the most likely Behavioral Biases of each BIT. The results of his finding led to the development of a methodology for how advisors can best work with clients in each of these BITs. In particular, determining how and when to either attempt to “moderate” an investor’s behavior or to simply “adapt” the investment strategy to accommodate their behavior.

Accepted for one (1) hour of continuing education by CFP Board.