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Whitnell & Co. Provides Wealth Management Tips for a Down Economy
Whitnell & Co. Provides Wealth Management Tips for a Down Economy
OAK BROOK, Ill. andCHICAGO, May 6 /PRNewswire/ -- For high net worth
individuals, wealth management expertise is essential at all points along the
economic cycle. But it's never more important to partner with skilled wealth
managers than during periods of economic decline.
(Photo: http://www.newscom.com/cgi-bin/prnh/20080506/CLTU007 )
During such downturns, wealth management firms can help take emotion out
of their clients' decision making, says Bill Thonn, president and CEO ofOak
Brook, Ill.-based Whitnell & Co., a wealth management firm that works with
high net worth individuals to craft optimal financial plans and investment
management strategies.
It's natural for investors to grow fearful and inclined to sell when
assets they own drop in price. Top wealth management firms possess the
knowledge and experience to explain why just the opposite approach is often
the much wiser philosophy.
"The market is driven in large part by emotions," Thonn says. "When you
hire a wealth manager, you hire this company to make disciplined,
non-emotional decisions.
"The manager must have the courage to make those decisions in the face of
the emotional reaction of the marketplace -- and in some cases that of the
client."
In discussing a client's needs, the wealth management firm may ascertain a
client requires $200,000 in the next two years. That sum will be placed in
safe money market funds and treasury bills to ensure it's available when
needed. If the market turns down, stocks won't have to be sold at low prices
to provide that $200,000. If it turns out the cash is not needed, a cushion
is available to scoop up bargains.
"If clients need money on a near-term basis, we make sure that it is
available," Thonn summarizes. "For money that's not needed short term, we
take a longer view."
Employing this long-term approach, a skilled wealth management firm may
acquire a stock for a client at $40 a share, having set a target value for the
stock of $50 a share. If the stock declines to $30 a share due to negative
market news, the firm can explain why it's important the client retain this
stock, and possibly acquire more shares at this appealing price. It's all
part of maintaining a long-term investment horizon and pursuing strategies of
purchasing asset classes at optimal price points, Thonn says.
"We have what we call our 'Attractive List of Stocks,'" he adds. "Though
they're attractive, we don't want to buy them at high prices. But if the
stock market declines and these equities drop to points we view as good
prices, we'll jump right in and buy them. This is the opportune time for us
to acquire these assets."
It's worth noting the guidance of wealth management firms can be equally
crucial when the economy is soaring, and investors can't wait to dive into a
market already at or nearing a peak. During such giddy periods, the
disciplined, non-emotional counsel of a skilled wealth manager may call for
locking in profits and exiting at market highs.
"We have a discipline," Thonn says. "That discipline is easier for the
client to recognize in the bad times, because we're not making panicky
decisions. But it's just as important in the good times, when we avoid making
over-exuberant decisions."
For more information about wealth management, visit www.whitnell.com or
call Bill Thonn at 630-575-2302.
SOURCE Whitnell & Co.
Copyright © 2008, PRNewswire
Copyright © 2008, NewsBlaze,
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