Hedging Against Inflation: Protecting Your Portfolio Against Market Fluctuations

by | Mar 11, 2022 | Advisor Blog

Home > Advisor Blog > Hedging Against Inflation: Protecting Your Portfolio Against Market Fluctuations

Hedging Against Inflation: Protecting Your Portfolio Against Market Fluctuations

It is difficult to deny we live in volatile times. The sanctions imposed on Russia following its invasion of Ukraine have sent the Russian economy into a freefall that is likely to have ramifications on the sanctioning nations as well. As COVID-19 transitions from pandemic to endemic, economic stability may be a long time in coming. Meanwhile, all the money produced and spent on COVID relief, as well as supply chain interruptions and unfulfilled consumer demand have led to serious inflation. With uncertainty the only worldwide certainty, protecting one’s portfolio from volatility and ensuring reliable gains becomes an investor’s greatest priority.

Inflation especially can be a major threat to one’s investments. The math is straightforward: if money has less value, investments are less valuable. Unchecked inflation is itself volatile, as it can both raise and lower the cost of borrowing, and do the same for unemployment. Thus while inflation is making investments less inherently valuable at their current total, it is also threatening to reduce that total, as more sensitive investments suffer in the wake of economic downturn. Investors hoping to counter volatility with stability should make sure their money is always working for them.

Growth And Value

Growth stocks are one particularly straightforward way to safeguard against inflation. If investments are losing value both in dollars and per dollar, a growth stock will increase the value of a portfolio, combating at least half of the problem. Growth stocks are shares in any company expected to grow at a significantly higher-than-average rate for the market, with the premise of providing profits through capital gains and the eventual sale of the shares.

Normally contrasted against growth stocks, value stocks belong to companies whose shares trade at a lower price than indicated by its fundamentals. These are the classic “buy low, sell high” stocks where the investor assumes the price will rise to better reflect the company’s intrinsic value. Where a growth stock counters inflation and volatility through reliable growth at a high price, value stocks offer low-cost chances to increase value. In times of high inflation, investors can purchase value stocks at a low price without much risk, knowing one especially successful value stock could pay for all the rest.

Reliable Growth

While individual growth stocks and value stocks could both provide a substantial return-on-investment, investors looking to emphasize stability may choose to invest in broad-based mutual funds. There are also mutual funds which focus on specific asset classes that generally perform well during periods of high inflation, including gold, commodities (such as oil, wheat, and precious metals), real estate investment trusts (REITs), and Treasury-Inflation Protected Securities (TIPS). Investors could also consider equity income mutual funds that pay high dividends as a way to offer greater protection against inflation.

Stay Off The Sidelines

What all of these investments have in common is that they are active steps to mitigate or hedge against inflation. Investors may see pulling money out of the market or simply not investing further as the commonsense reaction to a crisis, but such an approach leaves money sitting on the sidelines rather than working to bolster a portfolio and could lead to greater losses down the road. Especially since the best strategy when faced with inflation is the tried-and-true strategy of diversification: spreading one’s assets out into several or all of the above markets, so that no one crisis or unforeseen disaster can ruin a portfolio.

In trying times like these, market ups and downs are inevitable. The best advice to give investors is to counter volatility with stability and uncertainty with confidence. Keeping one’s money in the market through hedges against inflation is a sound way to create a resilient portfolio.

Christopher Crawford is the Head of Sales & Marketing for the Buffalo Funds. He has over 10 years of experience in the financial services industry, previously holding positions at Invesco, IMA Financial Group, and Arthur J. Gallagher. At the Buffalo Funds, Christopher works with investment consultant relations, key account management, institutional distribution and client service. His main goal is to partner with advisors to bring business building ideas and provide unparalleled customer support to their business, always striving to make it easy and reliable to work with the entire Buffalo Funds investment team. Christopher received an M.B.A. from Washington University in St. Louis and a B.S.F.A. from Southern Methodist University. He also holds licenses for the Series 7, Series 63, and Series 65.

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Christopher Crawford
Head of Sales and Marketing
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Considering ESG: Measuring Corporate Responsibility (Part 2 of 2)

by | Jan 24, 2022 | Advisor Blog

Home > Advisor Blog > Considering ESG: Measuring Corporate Responsibility (Part 2 of 2)

Considering ESG: Measuring Corporate Responsibility – (part 2 of 2)

Previously, we discussed the origins and nature of Environmental, Social, Governance (ESG), what each of these metrics mean individually and together, and their fiscal and ethical value to investors. Understanding what ESG measures, we can now discuss the practical effects of ESG on return-on-investment and what role it should play, if any, when crafting a portfolio. Does ESG lead to more profitable companies or just more ethical and sustainable ones, and how much weight should ethics and sustainability have when it comes to making decisions about investing?

Informally, ESG is a measure of three big picture factors any business should consider vital to success. In a recent MarshMcLellan study, companies with better ESG scores report 14% higher employee satisfaction, while a separate study done by Cone Communications notes that 88% of consumers will be more loyal to businesses that support social or environmental causes. Because ESG is a major consideration for many advisors, companies with better ESG plans will have an easier time attracting investors, thus raising their price per share and creating an inherent fiscal advantage.

According to a recent KPMG report, 80% of public companies both in the U.S. and worldwide now report on sustainability. Currently, 81% of U.S. public companies are providing ESG disclosures, as compared to 17% of private companies.

ESG Ratings

ESG serves as a social credit score for companies. To help investors understand this metric in a quick and easy way, organizations like Morningstar award companies numerical ratings (in Morningstar’s case, an “ESG Risk Rating”) to determine the risk inherent in each business’s environmental, social, and governance strategies, as determined by current plans and past achievements.

These ratings list factors such as overall investor risk, the highest controversy level raised by the company’s practices, and their primary ESG issues to give investors a snapshot of overall performance. 85% of asset managers consider ESG a high priority and use these ratings to determine whether the business in question is a sound investment due to or despite its ESG bonafides.

This intense scrutiny on ESG means most companies already integrate environmental, social, and governance strategies into their fundamentals. Many companies release a yearly ESG report describing their plans for excelling in these metrics and shoring up any perceived deficiencies to ensure a higher rating in the future. Many investors and asset managers scrutinize these ESG reports just as intently as they do a company’s financials. When doing so, however, it is important to look beyond a company’s own internal plans and self-appraisals to see how they deliver on their promises. An ESG plan that looks great on paper matched with poor performance is often a worse sign than no plan at all.

Is ESG a Good Investment?

With ESG increasingly considered a key performance indicator and companies striving to score strong ratings and publish well-regarded ESG reports, it is safe to say this metric should factor into whether a company is a good investment. At this point, it is simply too central to business discourse to ignore — if only because complete disregard could be a source of poor public relations for companies and their investors. How much of a factor should ESG be when making an investment?

Ultimately, while companies that wish to attract asset managers develop and deliver on solid ESG plans, ESG is not the be-all and end-all of metrics and differs in value to different investors. First and foremost, investors should consider companies that are or promise to be successful in business. The greenest, most ethical company in the world is not a sound investment if it stands no chance of turning a profit.

ESG performance can be a good way to view a company’s leadership to recognize how they manage sustainability and value a healthy society. For many investors, a company’s social credit matters and is an extension of good fundamentals and ethical beliefs. A recent ESG report from McKinsey noted that ESG propositions have a positive impact on equity returns 63% of the time. However, we cannot pinpoint a direct financial connection between ESG and ROI. This may change tomorrow if ESG is ever added to a balance sheet or income statement. Ultimately, we cannot say “only invest in companies with good ESG ratings,” but a good ESG rating could be a sign of a promising investment.

Christopher Crawford is the Head of Sales & Marketing for the Buffalo Funds. He has over 10 years of experience in the financial services industry, previously holding positions at Invesco, IMA Financial Group, and Arthur J. Gallagher. At the Buffalo Funds, Christopher works with investment consultant relations, key account management, institutional distribution and client service. His main goal is to partner with advisors to bring business building ideas and provide unparalleled customer support to their business, always striving to make it easy and reliable to work with the entire Buffalo Funds investment team. Christopher received an M.B.A. from Washington University in St. Louis and a B.S.F.A. from Southern Methodist University. He also holds licenses for the Series 7, Series 63, and Series 65.

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Christopher Crawford
Head of Sales and Marketing
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Considering ESG: Measuring Corporate Responsibility (Part 1 of 2)

by | Oct 28, 2021 | Advisor Blog

Home > Advisor Blog > Considering ESG: Measuring Corporate Responsibility (Part 1 of 2)

Considering ESG: Measuring Corporate Responsibility – (part 1 of 2)

Common sense dictates that ROI (return on investment) is the most important acronym in a portfolio, but another three-letter term has been catching up: ESG. Standing for Environment, Social, and (Corporate) Governance, ESG is an emerging metric that measures a company’s overall approach to ethical corporate citizenship as viewed through the lenses of environmental responsibility, treatment of the individuals and groups, and leadership.

Where previously such factors were seen as nice-to-have in the business world, growing concern over both the public-relations and ethical ramifications of company behavior has turned proper ESG planning into a must-have for any leading business. What should investors know about ESG, and does this metric measure any tangible value, or is it an intrusion of non-business concerns into the market?

History and Important Factors

The codification of ESG first began around the turn of the millennium, though movements toward corporate accountability have been a trend since at least the 1950s. ESG has been a response to growing internal and external pressure to judge companies on more than their bottom line. ESG refers both to the three factors it considers, and to each individual company’s strategy regarding those factors.

All three of the major areas of concern covered by ESG are extremely broad, but some of the most common concerns in each category are self-evident. When discussing ESG, it is important to remember that no company’s ESG plan can possibly account for all contingencies, and attitude and track record are at least as important as comprehensive preparedness, as a company that has shown it is serious about ESG concerns is likely to adapt well to emerging issues.

Environment, Social, Governance

Environmental considerations are those that deal with a company’s impact on the ecosystem both at large and in direct relation to its operations. As more and more executives and investors acknowledge the inescapable truth of the climate crisis, the market is adjusting to prefer behaviors that will slow or avert major climate catastrophe. Likewise, sustainability is a major area of interest as firms seek to do business without exhausting their resources or creating an untenable world for future generations.

Social concerns involve the ways in which companies interact with individuals and groups. This refers both to hiring and human resources practices such as diversity, closing the gender wage gap, and providing adequate time off and cutting-edge benefits. Companies should also avoid human rights violations in their operations and take the health and welfare of communities into account. Consumer protection has also grown in importance recently, with companies now under scrutiny for selling faulty or dangerous goods and for practices like predatory lending. Even animal welfare is included under the social part of ESG, to prevent needless cruelty in the treatment of livestock.

Finally, governance refers to the behavior of company leadership, less in regards to profitability and more with an eye toward ethics, corruption, transparency, and tax responsibility. This category covers the behavior not just of CEOs, but of C-suite executives, shareholders, and even employees, and focuses on management structure, workforce relations, and compensation for both executives and workers. Governance can also include the company’s own history for ethical investment, making sure businesses are judged not only on their own behavior but on those of the companies they support.

Why ESG Matters

Today, ESG is effectively a social credit score for companies, giving potential partners, customers, and investors a view into a firm’s attitude toward ethical concerns. These metrics are important regardless of how individuals feel about the need for moral action among businesses.

From an idealistic standpoint, ESG matters because it differentiates ethical from unethical companies and tangibly rewards decency and selflessness while exposing bad actors. Many individuals and groups feel laissez faire capitalism is unacceptable in an enlightened society, and that traits such as fair treatment of workers and customers, honest leadership, and good environmental stewardship provide inestimable value regardless of fiscal yield.

A more pragmatic approach can still value ESG as the traits it measures often indicate foresight and lateral thinking. Leaders with a good ESG strategy understand the ROI in things like positive public relations, a motivated workforce, and a stable ecosystem. Even for people with a hardline, profit-driven view of our free-market economy, understanding that many others, including the press, the employee pool, activist groups, and consumers, take ESG seriously is a good reason to do so as well.

ESG and Your Portfolio

Thus far, we have explained what exactly ESG is and why it is considered so important in today’s business world. But what should investors take away from all this information, and should ESG come into consideration when building a portfolio?

Part 2 of this series will discuss the facts and market research around ESG, and determine what role this metric should play, if any, in how investors allocate their funds.

Christopher Crawford is the Head of Sales & Marketing for the Buffalo Funds. He has over 10 years of experience in the financial services industry, previously holding positions at Invesco, IMA Financial Group, and Arthur J. Gallagher. At the Buffalo Funds, Christopher works with investment consultant relations, key account management, institutional distribution and client service. His main goal is to partner with advisors to bring business building ideas and provide unparalleled customer support to their business, always striving to make it easy and reliable to work with the entire Buffalo Funds investment team. Christopher received an M.B.A. from Washington University in St. Louis and a B.S.F.A. from Southern Methodist University. He also holds licenses for the Series 7, Series 63, and Series 65.

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Christopher Crawford
Head of Sales and Marketing
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What Investors Should Understand about IPOs and Meme Stocks (part 1 of 2)

by | Oct 8, 2021 | Advisor Blog

Home > Advisor Blog > What Investors Should Understand about IPOs and Meme Stocks (part 1 of 2)

What Investors Should Understand about IPOs and Meme Stocks – (part 1 of 2)

IPOs (initial public offerings) and meme stocks are exciting news items that have garnered headlines in recent years. While investing in an IPO or a meme stock has the potential for investment returns under the right circumstances, many financial advisors would call these speculative investments and not a major source of revenue for cautious investors. Financial advisors frequently only discuss investing in IPOs with those clients that have a high risk tolerance and are seeking the chance to get in on the ground floor of an interesting new business, or a potential large payout.

Evaluating IPOs

Since IPOs can be volatile, brokerage firms set requirements for their investors to participate. The IPO could be limited to investors with a certain amount in their brokerage accounts or a minimum number of previous transactions to their name. Because companies issuing an IPO inform brokerages who then inform their investors, it is difficult to participate in an IPO without hiring a brokerage firm. That brokerage firms are so careful about which of their investors can join in an IPO should make it clear that IPOs are not for everybody. Financial advisors should thus take a similar stance and explain the risks of IPO investments to their clients.

Overvaluation is the primary risk. Companies launching an IPO are incentivized to maximize excitement for the day their stock first becomes available, and must strike a balance between creating public interest in their brand without over-inflating that interest to the point that the stock comes crashing down immediately. Unicorns and high-profile brands are especially vulnerable, as in the case of rideshare company Uber. Initially valued at $120 billion, their valuation dropped to $76 billion after one day of trading. Today, Uber is valued around $86 billion, a significant value differential from their launch. Undervaluations are often just as dangerous, meaning IPO investments generally have three results, only one of which, an accurate valuation, may be positive for the buyer.

When evaluating an IPO, investors should pay less attention to excitement and more attention to a company’s fundamentals, using both the company’s prospectus and information provided by a reputable third party whenever possible. Private companies are required to disclose all pertinent information before an IPO, but this data is still presented by the company in the best possible light, while a third party would be unbiased. Investors should also look at the company’s competitors, leadership, financing, and prior press releases, as well as the overall health of their industry. If hype and excitement are the noise about an IPO, then the state of the company and its field are the signal.

Stronger underwriters can indicate a stronger IPO. Quality brokerages, banks, funds, and venture capital firms have good track records of picking investments that may pay off. Underwriters are especially useful in this regard, as large and reputable companies like Goldman-Sachs can afford to be selective and make the sorts of well-reasoned, risk-averse choices individual investors should make. But even these institutions are not infallible and most have underwritten bad investments before, so their support is not a foolproof indicator of an IPO’s reliability.

Myth vs Reality

Like meme stocks, IPOs can spawn a “gold rush” effect where the popular perception is that anyone can invest in an upcoming IPO and make a fortune overnight. In reality, only very large investors are likely to a good allocation of IPO shares. Companies can assign their stock to brokerages as they choose, and tend to favor larger, more reliable organizations. Thus, only connected investors with strong brokerages are able to buy enough shares to significantly profit, even if the IPO holds its initial valuation or appreciates.

Ultimately, the numbers don’t lie – according to stockanalysis.com, as of September 30, 2021, there have been 771 IPOs on the US stock market in 2021, which is an all-time record. Of these, roughly 72% have lost value, and 17% have lost more than 15% of their initial value. Of course some IPOs have appreciated significantly, but the chance of an IPO investment paying off is small enough to make any wise investor cautious.

IPO Participation through Mutual Funds

The lead underwriters for IPOs generally allocate the vast majority of IPO shares to institutional investors, like pension funds and mutual funds, leaving only a small percentage for retail investors. However, many mutual funds have bylaws that prevent them from investing in IPOs until the stock has traded for more than six months. In addition, many funds tend to be conservative in their investment approach, focusing only on investing in companies with attractive valuations, conservative debt, and free cash flow – qualities lacking in many of these IPO companies. The best option may be investing in mutual funds that offer exposure to early-stage companies – including some IPOs – rather than focusing exclusively on them.

Ultimately, investors interested in a company launching an IPO should listen to their financial advisor on the risk suitability of such an investment. Every IPO is an unknown value and unknown values are by nature volatile. Most serious investment portfolios only set aside a very small allotment for IPO speculation. One look at the IPOs from 2021 alone should give readers a good idea of how unpredictably these stocks can vary. Of course, daring investors can do very well with a timely IPO transaction, but, without absolute confidence, investors should consider IPOs a risky proposition, do as much research as possible, and limit their risk with smaller buys.

Part 2 of this blog series will discuss meme stocks in greater detail.

Christopher Crawford is the Head of Sales & Marketing for the Buffalo Funds. He has over 10 years of experience in the financial services industry, previously holding positions at Invesco, IMA Financial Group, and Arthur J. Gallagher. At the Buffalo Funds, Christopher works with investment consultant relations, key account management, institutional distribution and client service. His main goal is to partner with advisors to bring business building ideas and provide unparalleled customer support to their business, always striving to make it easy and reliable to work with the entire Buffalo Funds investment team. Christopher received an M.B.A. from Washington University in St. Louis and a B.S.F.A. from Southern Methodist University. He also holds licenses for the Series 7, Series 63, and Series 65.

As of 6/30/21, Uber was 2.03% of the BUFMX portfolio; no fund held Goldman Sachs. Click here for links to each fund’s holdings. Fund holdings are subject to change and should not be considered a recommendation to buy or sell any security.

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Christopher Crawford
Head of Sales and Marketing
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How to Discuss Cryptocurrency with Clients

by | Jul 12, 2021 | Advisor Blog

Home > Advisor Blog > How to Discuss Cryptocurrency with Clients

How to Discuss Cryptocurrency with Clients

Cryptocurrency remains an emerging phenomenon, and the time has not yet come to endorse or condemn it. With clients seeking investment advice on cryptocurrencies, financial advisors are telling their clients it is highly speculative and to approach with caution. Prior to investing in a cryptocurrency, advisors are having clients consider expanding their investments in top performing mutual funds and ETFs. Clients with a high risk tolerance are more likely to buy a cryptocurrency or crypto ETFs and they should have a clear understanding of what a cryptocurrency is and how the crypto market works.

What is Cryptocurrency?

We believe cryptocurrency is similar to many traded commodities like soybeans, corn, coffee, and sugar. They all have fluctuating values that are impacted by usage, demand, and availability. Cryptocurrency vendors control their own supply, but cannot prevent new vendors from entering the market. There is actually no limit to how much cryptocurrency may be mined. Anybody can enter this industry. According to CoinMarketCap, a crypto tracker, in 2019 there were over 2,100 cryptocurrencies created and today there are at least 5,520 cryptocurrencies available. This is what makes calculating cryptocurrency prices based on usage quite challenging.

There are a number of factors that contribute to cryptocurrency’s fluctuation. Crypto has no backing in the form of a nation, major bank, or precious resource, and there is no guarantee of its base value. Bitcoin, dogecoin, Unobtanium — all these cryptocurrencies are only worth what the market says they’re worth. In 2020 and 2021, expectations that national fiat currencies would undergo devaluation in the wake of COVID-19 (among other factors) led to a surge in the value of crypto as its projected worth increased, only for the latest Chinese vigilance to have the exact opposite effect as expectations clashed with the reality of government intervention.

And such intervention is not likely to stop anytime soon. Governments simply have a lot to lose and not much to gain by allowing the cryptocurrency revolution to supplant their own fiat money, so crypto must rise despite the intervention of some of the world’s most powerful fiscal and temporal institutions. Demand for digital currencies may well erode further if the United States Federal Reserve begins raising interest rates in the near future, and when countries like China and Russia seek to create their own digital currencies with national backing.

Cryptocurrency is a new commodity, and that very novelty contributes to its volatility. Cryptocurrencies don’t have a long track record over which experts can collate massive amounts of data about its inherent trends, risks, and rewards. Investors thus lack the knowledge to make truly informed choices.

Volatility and Speculation

Cryptocurrencies do not accrue interest over time and are now subject to capital gains taxes. This suggests that digital currencies should be considered a speculative trading tool more than anything else. It could potentially offer rich payouts if an investor can manage to buy low and sell high, but carrying the attendant risk of any volatile asset without the guaranteed upside of interest.

Most retail investors understand that investing always carries some degree of risk. For investors that relish the Wild West atmosphere around bitcoin and other digital currencies, advisors have the task of telling their clients that cryptocurrency’s volatility makes it a very speculative asset class and to treat crypto as an alternative investment. As a rule-of-thumb, institutional investors invest less than 1% of their overall assets in alternative investments. Individual investors buying crypto may want to consider their risk tolerance.

The Last Word is Pending

Some things appear to have a value just because they are popular, but as their popularity falters, so does their value. Some people have become overnight millionaires buying cryptocurrencies, and this has driven the demand for investors to get in on the action. The big question remains, “Can cryptocurrency continue to grow in value and is it a good or bad investment?” It remains to be seen if those overnight millionaires will be able to hold on to their wealth. At this time, many factors point to crypto being a highly speculative investment where many investors could find themselves at the short end of the stick.

Christopher Crawford is the Director of Sales & Distribution for the Buffalo Funds. He has over 10 years of experience in the financial services industry, previously holding positions at Invesco, IMA Financial Group, and Arthur J. Gallagher. At the Buffalo Funds, Christopher works with investment consultant relations, key account management, institutional distribution and client service. His main goal is to partner with advisors to bring business building ideas and provide unparalleled customer support to their business, always striving to make it easy and reliable to work with the entire Buffalo Funds investment team. Christopher received an M.B.A. from Washington University in St. Louis and a B.S.F.A. from Southern Methodist University. He also holds licenses for the Series 7, Series 63, and Series 65.

Cryptocurrencies could be vulnerable to fraud or cybersecurity risk. Investing in cryptocurrencies is highly speculative and an investor can lose their investment.

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Christopher Crawford
Director, Advisor Relationships
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Preparing for a Post-Pandemic World: 3 Key Tips for Financial Advisors

by | May 17, 2021 | Advisor Blog

Home > Advisor Blog > 3 Ways Financial Advisors Can Prepare For A Post-Pandemic World

Preparing for a Post-Pandemic World: 3 Key Tips for Financial Advisors

For over a year, the COVID-19 pandemic forced businesses and consumers alike to grow accustomed to meeting online. After so much of this distanced interaction, the pandemic appears to be coming under control. As vaccination rates spread, the CDC has relaxed safety protocols such that in-person business meetings are once more becoming possible, especially between vaccinated individuals.

This is excellent news for financial advisors, as building a personal rapport with clients is vital to a successful practice, and that sort of relationship is much easier to establish in person than online. But even as face-to-face meetings become acceptable once more, it is vital both for public health and the comfort and confidence of one’s clients to provide clear communication about safety precautions.

Get The Word Out

Financial advisors who plan to resume in-person meetings should let existing and potential clients know this option is returning. It is important at this time to check and update all email lists and send out communications detailing any changes in plans or protocols. Financial advisors who have embraced social media are in especially good standing here. These spaces for engagement provide a wonderful opportunity to get the word out to established clients while also catching the attention of individuals looking to begin face-to-face meetings with a new advisor. In the course of making these announcements, financial advisors should always stress the safety measures they mean to implement, as well as their commitment to communicating with and listening to their clients.

Precautions Are Key

Returning to in-person meetings does not mean returning to the way things were before COVID-19. The coronavirus is still at large within the population and even with vaccinations and careful safety measures, there is still a chance of contracting this dangerous illness at a face-to-face meeting. Thus, even with the current CDC guidelines, clients returning to meet in person should be provided with new and more rigorous safety practices for the foreseeable future.

As accustomed as business professionals are to beginning any meeting with a handshake, do not insist on this and make clear to clients that such contact is optional. Regardless of whether clients are comfortable shaking hands, hand sanitizer should be available. Other sorts of PPE such as gloves and disposable face-masks should be on-hand, and holding meetings wearing masks and remaining at a distance of six feet apart should be possible if that is what the client requires. Meetings can also be held outside if such spaces are acceptable, and one can minimize paper sharing by encouraging clients to bring their own tablets, phones, and laptops to review any documents.

Transparency and Flexibility

Proper communication with clients about safety measures may well be even more important than the measures themselves. Face-to-face meetings are meant to build trust and rapport, and there is no better way to demonstrate trustworthiness and protect a relationship than to explain clearly before the client even arrives what precautions and options are available to ensure everyone feels safe attending the meeting.

Financial advisors must consider and convey their own needs as well. It is better to hold meetings in masks and socially distanced than it is to be tense and uncomfortable in one’s own place of business. In this same vein, if a client would prefer to keep meetings online for the time being, they should know this choice is perfectly acceptable. Coming out of such a tense and dangerous period, safety and comfort should be everyone’s first concern.

The pandemic is by no means over and we must take care not to pressure ourselves or our clients. Business practices will return to normal — or find a new normal — in due time, and all we can do is adjust day by day. Just as we come out of the pandemic cautiously and intelligently, we should use our best judgment to create a safe and encouraging environment for our clients to return to a world of handshakes and in-person financial advice.

Christopher Crawford is the Director of Advisor Relationships for the Buffalo Funds. He has 10 years of experience in the financial services industry, previously holding positions at Invesco, IMA Financial Group, and Arthur J. Gallagher. At the Buffalo Funds, Christopher works with investment consultant relations, key account management, institutional distribution and client service. His main goal is to partner with advisors to bring business building ideas and provide unparalleled customer support to their business, always striving to make it easy and reliable to work with the entire Buffalo Funds investment team. Christopher received an M.B.A. from Washington University in St. Louis and a B.S.F.A. from Southern Methodist University. He also holds licenses for the Series 7, Series 63, and Series 65.

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Christopher Crawford
Director, Advisor Relationships
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