Specialized Investment Advisor It s About You Have you developed solid experience in providing financial advice, and want to try a deep, more specific area of investment? Are you able to partner well with generalists who need to call you in as the expert? If so, you may enjoy working as a Specialized Investment Advisor. What is specialized investment advisory service? Specialist investment advisory service relates to the provision of expert advice for a particular area of investment/financial planning by a Specialist Investment Advisor. The term Specialized Investment Advisor refers to a broad range of roles that many financial institutions have in place for investors with specialized needs. Examples of such advisors include:! Trust and Estate Specialists work with clients to manage transferring wealth across generations! Offshore Specialized Investment Advisors work with clients with an interest in holding some of their wealth outside Canada, often in geographic locations with advantageous tax policies (e.g. Cayman Islands)! Investment Advisors/Stock Brokers provide clients with advice on a broad range of securities, namely stocks and bonds In some firms, there are also specialist roles that provide support for generalist Financial Advisors. Specialists work with more complex products, strategies and clients to develop sophisticated financial investment plans What is the role of the Specialized Investment Advisor? Being a Specialized Investment Advisor generally involves working through a generalist Financial Advisor to understand client goals and to provide knowledge and advice in a particular area of expertise. Specialized Investment Advisors may be called upon to help secure new clients, work with existing clients to help diversify/enhance their existing investment portfolios, or help generalist Financial Advisors understand specific investment information. As technical expertise is a core asset that Specialized Investment Advisors bring to the table, continued education and certification is vital in this role. Specialized Investment Advisors may also play key roles in an organization s internal operations by providing input into product development and management, marketing and sales strategies. Specialized Investment Advisors may also work with Portfolio Managers to share insight and provide guidance on various investments and investment strategies related to their area of specialization. These Advisors may also be responsible for providing training to Financial Advisors and other investment sales professionals on products and services. Copyright 2010 Toronto Financial Services Alliance. All rights reserved. 1
Areas of Focus The Specialized Investment Advisor role can be an interesting, challenging and high-profile career option within the financial service industry. The opportunity for growth in this role is dependent on the level of expertise and experience developed in a specific product or service and/or the size and complexity of client portfolios with which the advisor deals. Many individuals can spend their entire career focused on one specialized investment area and continue to progress in their career development. Sample areas of focus include:! Trust and Estate Specialists work with clients to manage transferring wealth across generations! Tax specialist work with clients to select most appropriate strategies for tax savings (e.g. RRSPs, RESPs, etc.)! Offshore Specialized Investment Advisors work with clients with an interest in holding some of their wealth outside Canada, often in geographic locations with advantageous tax policies (e.g. Cayman Islands)! Investment Advisors/Stock Brokers work with clients who wish to transact in a broad variety of securities (i.e. stocks and bonds) In some firms, there are also specialist roles that provide support for generalist Financial Advisors. Specialists work with more complex products and clients to develop sophisticated financial plans. Main Duties Commonly, the main duties of Specialized Investment Advisors, regardless of the area of investment expertise, include: Specialized sales and business development Specialized Investment Advisors are responsible for promoting and selling specialized financial products and services, such as will and estate planning, trust management, direct equity investing and offshore banking. Commonly, Specialized Investment Advisors work through referrals from Financial Planners and sell into an existing client base. However, in some cases, they are expected to generate new business on their own. Key Activities:! Review existing client data and consult with Financial Advisors and/or their clients in order to identify relevant and appropriate specialized products and services! Prospect new business by identifying new and untapped client bases and develop a plan to connect with potential clients, as well as build new referral sources and generate referrals from existing clients! Analyze information on specialized financial products, competitor offerings and market trends in order to remain current with industry offerings! Liaise with product development teams to identify new product opportunities and development strategies! Contribute to the development of, and conduct educational seminars to inform groups or individuals about specialized elements of personal finance Copyright 2010 Toronto Financial Services Alliance. All rights reserved. 2
Provide specialized financial planning advice Specialized Investment Advisors are responsible for providing investment advice and guidance on incorporating specialized strategies/investments into clients broader financial plans. Their objective is to understand clients investment needs, and work with them to identify the right investment products and services that will help achieve their goals. Key Activities:! Consult with Financial Advisors and/or their clients to understand clients financial objectives, current financial plan in order to identify relevant and appropriate specialized investments! Explain different products, offer advice on the benefits and risks associated with them and identify how to integrate into clients financial plans! Maintain an up-to-date knowledge of the specialized investment area of focus and all relevant policies and governmental legislation! Network with external contacts as necessary to bring required expertise to the client (e.g. lawyers who may help manage trust estates) Client relationship management Like most other areas of investment management, a key element of the Specialized Investment Advisor role is establishing and nurturing client relationships in order to understand their investment needs, longterm goals and level of risk tolerance. Even if the primary client relationship is held by the Financial Advisor, Specialized Investment Advisors should still maintain a record or database of important client details such as contact information, history of client needs, general personal information (e.g. occupation, family status) and notes from meetings. Being able to anticipate clients needs and connecting with them in a timely fashion is an important factor in maintaining relationships. Key Activities:! Serve as the primary point of contact in specialized area of expertise! Educate and provide Financial Advisors and/or their clients with information on new and existing investment products and services through seminars, presentations, conferences and social events! Establish regular contact with Financial Advisors and/or their clients to discuss/inform about new investment products or changes to legislation that may affect their savings and investments. Suggest portfolio changes as required! Strive to increase client satisfaction by providing accurate, timely, welcoming and professional services! Maintain accurate client files with all relevant client information Copyright 2010 Toronto Financial Services Alliance. All rights reserved. 3
Work Context, Knowledge, Skill Requirements and Applicable Experience Work context Specialized Investment Advisors may work in an office setting, in a home office or may travel to meet with clients in their homes or offices. Daily tasks for Specialized Investment Advisors depend on the level of their position; those in more senior positions will take on advisory roles whereas those in more junior positions will take on transactional/ processing task. At all levels, interaction with other sales professionals and clients is typical. Specialized Investment Advisors may work evenings and weekends, in addition to regular business hours, to be responsive and accommodate the schedules of their clients. In relation to most specialized investment areas, collaboration and team spirit is important to build partnerships with Financial Advisors and maintain rapport with clients. Knowledge Specialized Investment Advisors require deep knowledge in their areas of expertise (e.g. tax and estate planning, off-shore investment strategies and opportunities). In general, they require knowledge of:! Investment products (e.g. stocks, bonds, mutual funds)! Financial planning strategies, including in specialized areas such as retirement planning, high networth management)! Investment needs during different life stages (e.g. early career goals, planning for children s education/retirement)! Competitive environment and competitors products! Sales cycles and processes in order to build a strong client base Technical Skills Specialized Investment Advisors require specific technical competencies:! Strong financial analysis skills and knowledge of accounting principles/techniques in to effectively work with financial projections and calculations regarding potential investments or savings strategies! Good research and analysis skills in order to keep up-to-date and maintain deep, specialized knowledge in selected area of expertise! Advanced computing skills in order to prepare client reports, conduct financial scenario analyses, create charts and graphs, and write marketing material Copyright 2010 Toronto Financial Services Alliance. All rights reserved. 4
Soft skills Specialized Investment Advisors require specific soft skill competencies:! Ability to network and establish relationships with clients and source referrals from financial advisors and product specialists! Solid negotiation skills in order to influence investment decisions! Active listening skills to be able to understand and infer client needs based on conversations with clients! Strong oral and written communication skills in order to explain and translate complex financial information or strategies to clients and other sales professionals! Excellent ability to motivate and organize oneself (i.e. highly self-motivated) in order to be able to work independently The following attributes are also very important for the role:! Strong customer-service mindset and a consultative working approach in order to serve clients interests and help them advance their personal financial goals! Highly goal-oriented in order to be able to work towards personal financial and sales objectives! Excellent judgement (i.e. use of discretion to ensure confidentiality of client information)! Strong willingness to adhere to strict codes of professional conduct Applicable Experience There are a number of related experiences that are transferable to the Specialized Investment Advisor role. While additional training may be required, people with the following backgrounds may do well as a Specialized Investment Advisor:! Experience in general financial advisory services; this general background acts as a good foundation for increased specialization! Experience in one or a few specific financial services areas such as wills and estate planning, offshore banking, consumer banking; expertise in one area can provide a good base of knowledge to add onto! Experience as a lawyer or law clerk; this background can provide important knowledge of rules and regulations/legislative framework that may be required in the role of Specialist Investment Advisor (depending on the area of expertise); more training and education in financial products would likely be required! Investment banking experience; this knowledge may complement specializations in particular investment areas Copyright 2010 Toronto Financial Services Alliance. All rights reserved. 5
Education, Certifications, Designations and/or Licences Entry Level Positions Entry level positions typically require: " Undergraduate university degree In the fields of:! Accounting! Business administration! Finance! Mathematics Senior Level Positions Senior positions will require: " Graduate degree In the fields of:! Business administration! Economics! Mathematics Additional Training Additional certifications/designations may include:! Certified Financial Planner (CFP)! Personal Financial Planner (PFP)! Financial Management Advisor (FMA)! Canadian Life Underwriter (CLU)! Certificate in Estate and Trust Planning (CETP) Estate & Trust Licence requirements (depending on the type of organization) may include:! Registered Representative (allows for advising on stocks, bonds, mutual funds)! Registered Representative Mutual Funds Only (allows for advising on mutual funds only)! License to sell life insurance (including accident and sickness insurance); license to sell accident and sickness insurance only; see Life Licensing Qualification Program (LLQP) options! Canadian accounting designations ((Chartered Accountant (CA), Certified General Accountant Copyright 2010 Toronto Financial Services Alliance. All rights reserved. 6
(CGA), Certified Management Accountant (CMA)) Additional/other training may include:! Canadian Securities Course (CSC)! mutual funds course! FINRA Series 7, Series 63, Series 14, Series 26, Series 27, Series 39 for those working for organizations with US operation! Wealth Management Essentials Estate & Trust Representative Job Titles Depending on the organization you work for, Specialized Investment Advisors may hold various job titles, including:! Will & Estate Planner! Trust Advisor! Trust Officer! Certified Investment Specialist Career Pathways Moving into the role In order to establish oneself as a Specialized Investment Advisor, additional training and experience after completion of college or university is typically required in order to gain in-depth knowledge in particular areas of investment/financial planning specialization. Experience as a Financial Advisor or Investment Analyst is a great way to gain knowledge and practical understanding of financial planning, advising or sales of various investment products. These roles are great stepping-stones to the role of Specialist Investment Advisor. Depending on the product or service you want to specialize in, you can choose to begin your career in either junior-level investment roles or broader financial advisory roles. These roles will help you gain necessary experience with standard investment vehicles such as GICs (Guaranteed Investment Certificates) and mutual funds. After developing basic investment knowledge and sales skills, as well as establishing the credibility required to be a successful advisor, concentrating in a specific investment area will be a natural next step in your career. Progression beyond the role Options for progressing beyond the role of Specialized Investment Advisor ultimately depend on your career interests and personal development plan. You can continue to deepen your expertise in your chosen field of interest or explore other areas of specialization (e.g. focusing on high or ultra net worth clients, new immigrant clients, Aboriginal finances, offshore investments, etc.) While your job title may not change, you may choose to work in operational or corporate areas within an Copyright 2010 Toronto Financial Services Alliance. All rights reserved. 7
organization, such as product management, marketing, risk or portfolio management. You may also choose to pursue various management roles such as leading a specific region or managing Investment Advisors or Financial Advisors. Specialized Investment Advisors may also move between organizations to become high level experts or gurus in their area of interest or specific industry. External Factors Impacting the Role A variety of external factors may influence the nature of the work in this role. Changes in investor demographics may lead to an increasing need for estate planners as Baby Boomers enter retirement age and consider including this type of advice in planning for their financial portfolios. Specialist Investment Advisors must also remain up-to-date with any changes in industry rules and regulations impacting requirements for licensing/registration, sales and trading activities. Employment Trends and Outlook Demand Outlook Demand for specialized investment expertise continues to increase as:! the population ages and matures, and the need for retirement planning strategies becomes increasingly important for majority of the population! the overall population amasses greater wealth and the amount of wealth being passed between generations increases, and the need for advice on transfer of wealth/estate planning also rises! investment products and methods of investing become more complex, driving the need for specialized advice to assist investors in selecting the most appropriate products for their portfolios; in addition, investors, in particular high-net worth clients, may be seeking more sophisticated investment options and therefore specialized investment advice! firms strive to become more competitive and acquire new market share, Specialized Investment Advisors are increasingly important in helping to meet the needs of a variety of the firms clients Compensation Compensation levels vary greatly based on experience and the complexity of the investment/financial advisory services provided. Commission is usually a key component of their compensation. Copyright 2010 Toronto Financial Services Alliance. All rights reserved. 8