Reading lays the groundwork for almost every decision we make. Whether it’s a book, journal, article, or analysis we’re scanning, the information we learn will likely cement something we had planned, or it will deter us entirely from making it.
This is especially true when it comes to decisions about an investment. For financial advisors, questions that usually come up daily are: which S&P 500 sector is on the rise; are the bears or bulls in control; or what is precisely in my client’s mutual fund?
To read is to know—the only way to discover those answers is to have the research in front of us.
Today Potomac is known for pushing out research regularly; however, that wasn’t always the case. The company lagged on investment management content, but they weren’t the only ones in the industry either. Rather than continue to lag, they ascended forward.
Manish Khatta brought on Dan Russo, CMT, and his group of loyal subscribers, to begin producing the Daily Note, which covers his views on the market (market breadth, broad market sectors, global regions, and so on) every day.
We read market commentary everywhere we go; even Twitter has an entire Fintech channel for it, but advisors need to know when to separate opinions from the facts.
Research is vital in this industry, especially research by money managers. The positive feedback Potomac received solidified that there needed to be more analysis like the Daily Note for financial advisors; rather than having a sales-based mindset, Russo put out content to specifically educate advisors on what was happening in the marketplace.
Khatta saw an opportunity and built upon it; with the additional hire of Drew Wells, CMT, CIMA, the Investment Committee launched, Research by Potomac; a direct gateway into Potomac’s investment process, “everything we put out on the investment side starts with our research,” Khatta said.
The essence behind Research by Potomac is that financial advisors should be able to read the research that allows them to make informed market-based decisions for their clients; what better content than the conversations that drive Potomac’s investment decisions?
“I’ve spent a lot of time reading the research of different types of analysis, whether it’s technical, quantitative, or fundamental; a lot of times what is missing is the, how do I make money aspect,” said Russo.
We all can assume every financial advisor has one certain goal they like to achieve: make a client’s investments extremely profitable. Besides that, every financial advisor has a different roadmap to get there.
Whether it’s an institutional client who must have a certain equity allocation or a client with a certain fixed income allocation—it’s essential to read and understand the opportunities and risks of a stock, mutual fund, ETF, etc.
This is the foundation that our Investment Committee starts their conversations from. Research by Potomac strays away from research with long ideas that don’t cover any opportunities of major holdings in a lot of client portfolios; instead, it focuses on covering asset classes, both on an absolute and relative basis, and linking back to other reports that analyze what is moving the markets.
Financial advisors should be following the data, and by reading our scanning reports, sector deep dives, small caps ideas, Intermarket analysis, and other exclusive content like our chart book, they’ll be able to make their investment decisions based on facts—not clickbait.
When news outlets make day-to-day comments about the “Death Cross” or the “Hindenburg Omen,” no one ever stresses what it means or pinpoints the data to see how well the market historically performs after this death cross; does it go down for a week and then rally? Is this the end as we know it? (Definitely not.) Research by Potomac dives into this type of analysis, so financial advisors don’t make detrimental decisions that could affect long-term goals.
Our first thought should be to capitalize on the investment choices we make, and by doing that, we must read the research that puts the analysis behind every chart.
Every declining chart we run into shouldn’t make advisors pull out all their money; it should bring about questions, and all questions have answers—we just need to read the research that allows us to make the right decision.
Disclosure: This information is prepared for general information only and should not be considered as individual investment advice nor as a solicitation to buy or offer to sell any securities. This material does not constitute any representation as to the suitability or appropriateness of any investment advisory program or security. Please visit our FULL DISCLOSURE page.