It is with great pleasure I write my first of hopefully many blog postings for the Claris website. I have loved finance since, at the age of 14, my grandfather taught me how capital markets work. My grandfather was a remarkable man who spent his formative years simply surviving the Great Depression. By the time I came to know him, he had achieved what I feel was a remarkable level of success. As I aged, the idea of my grandfather’s success (especially in light of where he started) became more and more impressive. One day, I finally asked the question that had been stirring around inside of me for quite some time: “Papa, given where you started in life, how have you achieved such success?” His answer, beautiful in its simplicity and message, has become the guiding light of my life and more specifically, my career. He succinctly replied, “I’ve always made it a priority to treat people the right way.” This concept, which I will discuss in a moment, is what ultimately led me to Claris Advisors.
While he may not have realized it, my grandfather was describing the heart and soul of the fiduciary standard. As a Registered Investment Advisor, we at Claris are happily bound by the fiduciary standard. This means that we are legally obligated to put our clients’ interests ahead of our own. Simply stated, we must avoid conflicts of interest, operate with full transparency, and consistently monitor our clients’ investments. We must always do what is in the best interest of our clients. All of us at Claris already believed in these standards of care, so we were more than happy to make it a part of our legal obligation to our clients.
Some individual investors might say, “So what. An investment is an investment. There can’t be that big of a difference.” Those sentiments couldn’t be further from the truth. In fact, a recent study by the President’s Council of Economic Advisers estimates non-fiduciary advice costs Americans 1 percentage point of their return annually. Nationwide, this amounts to $17 billion each year. If we compound these numbers over multiple years, even decades, the amounts are staggering. As hundreds of financial publications have pointed out, investors should do everything in their power to work with a fiduciary. We would love the opportunity to be yours.