The survey asked over 1,600 investors between age 21 to 80 various questions. Amongst those included was one that both a majority of self-directed and advisor-driven answered relating to what they'd do if they had a large amount of money to invest over the next five years. Both groups answered positively that they'd choose an investment that offered "a substantial opportunity for returns with moderate risk of losing some of your original investment".
However, overall the self-directed group felt more uncomfortable with "any fall in value" of the investment (22% agreeing with that), compared to only 16% in the investment advisor driven group agreeing with that sentiment.
So I guess that the education and "hand-holding" function that is offered by investment advisors is generally helpful to their clients, in that they help keep their clients in the market during soft periods. The question remains as to whether that hand-holding function alone offsets the cost of the advisor.
- If you aren't willing to see the value of your investment fluctuate by up to 50% annually, then you probably shouldn't invest in the stock market.
- Superinvestor Warren Buffett
The Confused Capitalist