The Evidence-Based Investor

Four ways an adviser adds value – 4. Behavioural coaching [Video]

Posted by Robin Powell on April 29, 2016

So far we’ve looked at three keys ways in which a financial adviser adds value:

There is, however, a fourth rôle an adviser plays which, in many cases, is the most valuable of all — behavioural coaching.

Even those who understand the importance of remaining disciplined find it very hard to hold their nerve in turbulent markets. At some stage, most investors let their emotions get the better of them and take exactly the wrong course of action. Before I learned about behavioural finance, and the damage caused to our long-term returns by irrational behaviour, I made some very poor decisions myself.

By persuading you not to bale out of equities during a correction, or to pile in when markets seem to be heading inexorably higher, a financial adviser can easily repay your fees several times over.

One way of estimating the value of behavioural coaching is to compare the returns generated by a fund with the returns experienced by the average investor in the same fund. This shows how much value investors destroy on average by periodically buying and selling. The figure varies from around 1% per annum to 2%, depending on the market.

If, say, your adviser helps to add an average of 1.5% a year to your returns by managing your behaviour, that will make a very substantial difference by the time you come to retire.

I hope you’ve found this series helpful. Please do share it if you have.


This is the final video in a five-part series called The Value of Advice. The series has been made by Regis Media, the producer and sponsor of The Evidence-Based Investor. The videos are intended for use by advisory firms to help them communicate their worth to clients and prospective clients.

If you’re an adviser, and you would like your own version of the series, in your firm’s branding, and carrying your contact details, and perhaps a call-to-action and disclaimer, please get in touch with Sam Willet at or Christina Waider at Alternatively you can call us on +44 (0)121 285 2585.

The Value of Advice is one of three pre-produced video series currently available to advisers, the others being Six Steps to Successful Investing and Evidence-Based Investing Insights. All three series have been tailored to different markets — principally the UK, Ireland, the US, Canada, Australia and New Zealand. They are also available in Dutch and in German.

  • Share article:

Robin Powell

Robin is a journalist and campaigner for positive change in global investing. He runs Regis Media, a niche provider of content marketing for financial advice firms with an evidence-based investment philosophy. He also works as a consultant to other disruptive firms in the investing sector. Regis Media.

Disclaimer: All content is for informational purposes only. I make no representations as to the accuracy, completeness, suitability or validity of any information on this site and will not be liable for any errors or omissions or any damages arising from its display or use. Full disclaimer.