Managing Client Expectations During Market Downturns

Stay Ahead of the Conversation

Proactive communication is key during market downturns. Research shows that nine out of 10 clients value frequent updates, with 88.2% of advisors’ clients reporting they consider their advisors’ frequency and style of communication when deciding to retain their services, and 89.7% do so when making a referral. 

The most successful advisors consistently remind clients that market corrections are a normal part of the investment cycle and that their portfolios are specifically designed to weather these periods.

Leverage Data to Build Confidence

During market volatility, data is an especially powerful ally. Historical market analysis shows that bear markets, while uncomfortable, are temporary setbacks in a longer journey. Consider, for example, Bloomberg data reporting a greater than 5% drawdown in the S&P 500 Index in every year but two (1995 and 2017) since the early 1980s.

By incorporating research-backed insights into client communications, advisors can help put current market conditions into perspective and demonstrate why staying invested typically leads to better outcomes than trying to time the market.

Harness the Power of Quantitative Models

Removing emotion from investment decisions is critical during volatile periods. Quantitative-driven models provide a disciplined approach to portfolio management, ensuring that risk management and strategic tilts align with market changes rather than emotional reactions. This systematic strategy allows advisors to:

• Implement consistent rebalancing techniques
• Make tactical adjustments based on market conditions
• Customize portfolios to reflect individual client risk tolerances
• Demonstrate active management through market cycles

Reframe Market Volatility

Rather than viewing a market downturn as something to be weathered, help clients see them as potential opportunities to:

• Rebalance portfolios at attractive valuations
• Take advantage of tax-loss harvesting
• Reinforce the benefits of dollar-cost averaging
• Focus on long-term goal progression rather than short-term market movements

Strengthen Client Relationships in Any Market Environment

Managing client expectations during market uncertainty isn't about predicting the future—it's about demonstrating that you have the right tools, expertise, and processes in place to navigate any market environment. 

That’s where Helios comes in. Our comprehensive suite of resources empowers you to communicate effectively through white-labeled market updates, investment strategy summaries, monthly research reports, and investment committee documentation.

Through Helios’ customizable investment models, deep market research, and personalized investment commentary, you can tap into all the capabilities of an entire investment department without the cost, headache, or hassle of an internal team, helping you focus on what matters most: building and maintaining the trusted relationships that help clients stay the course through all market conditions.

Ready to learn more? Get in touch with our team here.