Financial Advisors Have To Use Non-Traditional Methods To Turn Doctors Into Clients

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How To Build A Practice That Caters To Physicians (Advisor Perspectives)

Doctors are wealthy but a hard group for advisors to tap because they spend long hours working and rely on referrals from other doctors, writes Greg Stokes in Advisor Perspectives. To “ingratiate” themselves to doctors, advisors should understand their needs. Advisors should also be able to help them prepare for the eventuality that their surgical skills will diminish. They need to factor in that doctors often have large student loan debt.

But there are factors to consider as well. “From an in-depth comprehension of the effect of the Affordable Care Act on physicians to being able to provide physicians with advice about how to capitalise on new payment models, successful advisors must go beyond the traditional advisor-client role.”

Advisor Group That Managed $US700 Million Leaves Merrill Lynch (Investment News)

The Andriole Group, a team of advisors that managed $US700 million in clients assets, has left Merrill Lynch Wealth Management for Chicago-based HighTower Advisors, according to Trevor Hunnicutt at Investment News. The team includes Charles Andriole, Geoffrey G. Gregory, Robert A. DeLucca and Matthew J. Montana.

How The Correlation Between Stocks And Bonds Has Changed With Each New QE Program From The Fed (Societe Generale)

During QE3, the Fed’s asset purchase program, we’ve seen that when bond yields rise, so do equity prices and vice-versa. A chart from Societe Generale’s fixed income strategists shows the effects of QE programs on bonds and stocks.

“We have currently reached a new peak in equities, and the ‘beta’ — that is, the strength of the relationship for equity prices to rise as bond yields rise (the coefficient on ‘x’ in the regression equation) — is probably unsustainably high as the Fed tapers asset purchases over the next six months,” write the SocGen strategists in a note to clients.

“Based on the QE3 regression equation, the projected level of the Dow for a 10-year Treasury yield at 3.00% is 15,916; for 3.25% it’s 16,338; and for a 10-year Treasury yield at 3.50%, the Dow would be at 16,760, or 5% higher than it is right now. We don’t expect equity prices to dive, but we do suspect that in 2014 as the Fed eventually tapers asset purchases, the level of bond yields will rise and equity prices will be volatile, moving roughly sideways for a time while both markets re-adjust.”

Advisors Need To Be Wary Of The Risks Foreign Stocks Bring (The Wall Street Journal)

Advisors need to be more aware of the risk foreign stocks bring to their clients’ portfolio. “Vendors like to say that you should set your allocation to foreign stocks based on the percentage of U.S. stocks in world equity markets,” writes David Loeper of Virginia-based Wealthcare Capital Management in a new Wall Street Journal column.

Foreign stocks carry currency risks and bring additional expenses and taxes with them. Moreover it’s important to remember that stock performance isn’t correlated with GDP growth. “To come up with a truly foreign portfolio, you would have to go through and look at the source of income and profits of each individual company by what country they derived those profits. And nobody does that.”

How To Use Insurance To Facilitate A Business Succession Plan (

Business owners may sometimes not have children that want to take on their business or it might be hard to equally distribute it among the heirs. In that instance, “a life insurance policy can provide cash to even out distributions,” writes John McManus in

“For businesses that have significant cash flow needs, or for clients with substantial real estate holdings that function as a business, a life insurance policy can guarantee liquidity to cover maintenance expenses — a worry no one wishes on grieving loved ones.

“Insurance is an essential component of businesses with multiple partners and buy/sell agreements to ensure that the surviving partners have liquidity to buy out the interest of the family of a deceased partner.”

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