Ditch benchmarks in client conversations, advisers told

Adrian Kwa

ANZ’s head of advice transformation Adrian Kwa said goal-based investing offered a more focused approach that addressed the most important issues for investors.

They would often have a range of goals, both short and long-term – and advisers could tailor their portfolios to suit the desired outcomes.

If a client needed money for their kids’ education in a couple of years, a percentage of the portfolio could be separated off and allocated to that goal, with the correct asset allocation. Its performance could then be judged on how well it was on track to achieve the target.

Adviser Jordi Garcia said it was a method he already used. “A benchmark is just a yard stick, that’s all. To be honest, most clients don’t have a realistic expectation for benchmarks. If you ask a client what their expected return from an investment will be they can’t answer that because they have nothing to gauge it on.”