The financial market brings several opportunities for investors, but doubts may arise on this journey. Therefore, it is necessary to know the solutions to assist in decision making. This is the case with investment advice.
The service plays an important role, but not all investors know about it. Because of this, they also do not take advantage of the benefits it can bring to their investment portfolio. Want to know more about how the professional can help you?
In this article you will see what an investment advice is, how it works and how it can be useful for the investor. Check it out below!
What is investment advice?
Investment advisory is a service provided by the autonomous agent or investment advisor. He is the professional qualified to support investors. However, it is necessary to understand how the service actually works.
It can be offered by an individual or legal entity, which must be registered with the United State Securities and Exchange Commission (CVM). This is because it is necessary to carry out certification tests to prove the knowledge necessary to perform the function.
Also, be aware that the investment adviser does not make recommendations on how to invest the capital. In fact, the service works as a support, giving guidance on the different options on the market.
To do so, he needs to know the investor, his profile and objectives, in order to offer a personalized service. An important issue on the subject is gratuity: who pays for the advisor's work is the financial institution to which he is linked.
How can investment advice help investors?
Still not sure if the service is worth it? To help, we've listed how investment advice can help you on your journey.
When searching for tips on investing, you will likely see one indicating the need to know your investor profile . It manages to classify investors according to their risk tolerance and return expectations.
Thus, it is from this definition that it is possible to identify more adequate alternatives, considering risks, liquidity and profitability. However, defining the profile is not a simple task, as it considers different characteristics, such as:
• financial goals ;
• ability to take risks when investing;
• available capital;
• desired timeframes for the investment;
• Monthly income.
An investment advisor is able to collect the necessary information to help the investor find your profile. Also, it can better explain how each one works — in case you already know yours.
Yet, in an extended relationship, it will also be possible to identify changes. With time and greater knowledge about the financial market, it is common for the profile to change and the portfolio needs to follow up.
Presentation of opportunities
Do you know all the options in the financial market and follow trends? There are several subjects that must be studied daily to stay updated. With this, it is common not to know about some opportunities .
Having an investment advisor makes the task easier and helps the investor on the journey. The autonomous investment agent has in-depth knowledge of the financial market . In addition, it follows the movements and trends frequently.
In this way, he can present the appropriate investments to his investor profile and objectives. However, it is worth remembering that it does not indicate investments, nor does it analyze. The purpose is to provide more information about the financial market for you to decide.
Clarification of doubts
Continuing the idea of the previous topic, the investment advisor is available to clarify your doubts. Each option in the financial market has specific characteristics, which usually raise several questions, such as:
• taxation rules ;
• redemption period, if any;
• profitability potential;
• risks involved;
• fees applied.
Searching for all the answers is not always easy. And it is essential to know reliable sources to be sure that the information is correct and not to make mistakes. In the advisory service, the professional will clarify all your questions so that you have no doubts when investing.
Help to achieve goals
A common difficulty when investing is identifying which modality is best suited to your goals. This is because there are many factors that must be evaluated, such as the need for high liquidity and availability of values or security.
An emergency reserve, for example, is usually allocated to options that have protection and liquidity, even with lower profitability. An investment for retirement, on the other hand , can have a longer term and more risks to benefit profitability.
In this case, it is necessary to consider not only your profile, but the specific goals for each portion of your capital. Mistakes can generate losses, as in the case of an early redemption for not understanding the rules applied.
In view of this, the advisor also considers what the client is looking for when investing to present products aimed at each goal. If you want a longer-term alternative with greater profitability, he will explain the possibilities and how each one works.
The same goes for other goals, such as increasing wealth , living off income, etc. Therefore, investment advice supports the investor to achieve financial goals. This makes it easier to achieve your goals.
Support in times of crisis
Economic crises or personal difficulties can bring more doubts about how to deal with the investment portfolio . When is the right time to sell an asset or redeem an investment? Knowing how to act in these cases is essential for your heritage.
The advisor, by following the market, is able to offer support during times of crisis . He is able to understand the impacts of fluctuations in each investment, clarifying the investor's doubts. Based on this, it is possible to make more conscious decisions when dealing with adversity.
More security to make decisions
One of the great benefits of investment advice is that it aims to provide you with information. The idea is for the investor to learn about financial market options , knowing how they work and other characteristics.
Therefore, you will have a reliable source of information to deepen your knowledge and exercise autonomy when investing. In this way, you can have greater security to make your own decisions and build a personalized wallet.
Ready! Now that you know what an investment advisory is and how it works, consider the usefulness of this service in your case. It brings several benefits, with support to clarify doubts and help in the composition of a portfolio suited to the profile and objectives.
Still have questions? Contact us and talk to one of John Labunski advisors!