Business World Far From Investors’ Ideal: AFR Letter to the Editor
Jonathan Shapiro’s article (“Wealthy families falling behind in managing their fortunes”, 13 Sept) quoting Dillon Hale gave voice to many of the concerns felt by those of us in the industry who actively avoid the old-school practices of some players still keen to engage in ‘hyperactive buying and selling in portfolios’ that put a client’s capital and legacy at risk.
However, an issue not covered, but keenly felt by those of us who manage investments for many of Australia’s wealthiest families, is the challenge to recognise the diversity in skills and thought that arises from being an investor versus being a business operator, and how this can lead to conflict.
Between advisor and client, it’s essential for both parties to acknowledge and appreciate the roles each can and must play. Investors think the business world is ordered and methodical, and run by high-level strategy that correlates perfectly with underlying financial models.
Business operators, on the other hand, believe investors have a limited understanding of the ‘real world’ and that their own business success transfers easily to managing investment capital.
Both are wrong.
Needless to say, I’m not turning to a medical expert for stock tips, but know who to call when I need medical attention. The key is respecting the fundamental differences between both the investment world and business operations and how much can be learnt by staying in your lane.
Josh Derrington, CIO Alvia Asset Partners, Brisbane