Tuesday, February 22, 2011

Stay the Course or Go With the New Flow?

Happened upon Ric Edelman's radio show again last Sunday. (He's expanding into TV this spring.) Ric was discussing how to choose an investment adviser. Find somebody whose approach has stood the test of time, he said. When a potential adviser tells you he or she has got the right approach for 2011, ask what advice the adviser was offering in 2006. And 2008.

An adviser stalwart enough to stay the course may be worthy. But marketable? Not so much. When investors seek new advisers, they want a new approach. To catch their attention you have to offer one. BNY Mellon's ads in the last two NY Times Sunday Magazines took that tack:
Staying the course is like navigating a new world with an old map.

The only investors staying the course are those with a broken compass.
Good headlines. And if BNY Mellon's 2006 and 2011 strategies are not consistent, so what? Aldous Huxley would have understood:

Consistency is contrary to nature, contrary to life.
The only completely consistent people are the dead.

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