An investor without an investment philosophy is like a car without an engine. Without a convincing, evidence-based set of beliefs about the markets and how to invest in them, risks capital loses.

Reason’s Financial Advisors Should Have An Investment Philosophy

For financial advisors, an investment philosophy can have a large impact on the success of their practice. In this blog, we are going to review five ways an investment philosophy impact a financial advisory practice.

Improved Efficiency

Once an advisor has a defined set of guiding principles that will not be affected when the market changes, everything that is completed should align with said principles. This will make it easier for advisors to determine what their time needs to be spent on as well as what their time should not be spent on.

Better Client Experiences

Financial advisors cannot provide clients with a satisfying experience if they do not offer the services their clients are looking for. Having, and being upfront about, an investment philosophy will potentially help advisors find clients that are a good fit for their practice and avoid the clients who are not. It’s better to determine if clients are a good fit early on, rather than spending time trying to cultivate a relationship that will not last for long. Additionally, having one clear investment philosophy may allow advisors to work more efficiently with clients and help them deliver a more consistent client experience.

Consistent Investment Results

Just like portfolio rebalancing strategies, investment philosophies should stay the same, no matter what the current condition of the market is. Changing investment philosophies every time the market changes can hurt an advisor’s financial practice. Advisors should choose a philosophy that they believe in and stick with it.


A clear a public investment philosophy can help advisors stand out from the competition. Additionally, there is a chance of attracting centers of influence that can help build their practice’s team.

Effective Client Interactions

An advisor’s investment philosophy should provide a foundation for client meetings and conversations. Once an advisor’ss clients understand and believe in their investment philosophy, the advisor can spend more time talking about their client’s goals and how to reach them, and less time on what markets are currently doing.

When advisors take the time to identify their investment philosophy it helps form the foundation for their practice and makes it possible to do something worthwhile for their clients. In fact, the right investment philosophy can help advisors develop stronger relationships with their clients.

However, focusing on an investment philosophy and clients can be difficult, but with AlphaDroid, an asset allocation software for financial advisors, it is possible. AlphaDroid’s asset allocation software is specifically designed to do the ‘hard work’ associated with financial advising, allowing advisors to focus on developing strong relationships with their clients and improving their practice. AlphaDroid doesn’t just help keep client investments strong by pursuing great opportunities, it works equally as hard to protect them from experiencing lows. It is truly the pinnacle of asset allocation software.