Experience Gives Us a Better Perspective

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Experience matters in so many industries and especially financial services and technology.

I’ve been in the financial services industry since 1987, so I’ve had the fortune of seeing quite a few historical events. There are many younger (ages 25-40) financial advisors in the business today, so I want to share something from my experiences in 1999. It will be very helpful when you are talking to older clients like me and you’ll find it interesting.Mutual fund results for ONE year in 1999:
  • 168 mutual funds returned more than 100% in 1999.
  • The average US equity fund (excluding sector funds) returned 26.95%.
  • The average technology fund returned 122%.
  • The average Internet sector fund returned 131%.
  • The top performing fund in 1999? Nicholas-Applegate Global Tech fund: 496%...yes 496.08%
  • 2 nd Best performer? Warburg Pincus Japan Small Company Fund: 330.19%
  • By March 2000, 275 mutual funds posted gains of 100% or more for the trailing 12 months.
  • For the trailing 12 months through March 2000, the worst performer of the Top 50 funds returned 171%.
  • The #1 performer of the Top 50 was the PBHG New Opportunities: + 529.94%
    • From 2000-2008, I was a guest speaker at more than 700 financial advisor training meetings and client events, so I talked about expectations and history lessons. Advisors were frustrated when they talked with their clients about asset allocation and how diversification averaged 10% over the past twenty-five years. 10% wasn’t so appealing when so many funds returned over 100% in ONE year! In 1999, I asked an audience of clients what THEY expected from their funds. A sweet eighty-year-old woman stood up and told the audience that one year returns of 100% was crazy and she wasn’t that greedy or out of touch with reality. She said, “If my investments can average 40-50% a year for the next ten years, I’ll be satisfied.”

    She said, “If I can average 40-50% a year for the next ten years, I’ll be satisfied.”

    Life changes quickly my friends. Study history and you will be much better at sharing stories with your prospects and clients.