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Pioneer – The Reformed Broker

Investment Tips

Pioneer – The Reformed Broker

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Why did we name each of our strategic asset allocation portfolios after different NASA space missions? One major reason is that names carry certain connotations that can get in the way of someone receiving the financial advice that they have to actually hear and heed.

Our Pioneer portfolio is a perfect example of this – it’s definitely aggressive in terms of its target weighting and potential volatility, but it is highly appropriate for many of the families who reach out to us for help. They don’t want to be labeled as being “aggressive” but their financial plans and future financial needs require a somewhat aggressive posture. Taking the words “aggressive, moderate, conservative” off the table makes it easier for us to do our job as advisors, and to make sure our clients are invested appropriately. Labels like “aggressive, conservative” carry a certain stigma that can be counterproductive. They are also ill defined and their meanings can shift depending on how people think of themselves or what’s happening in the environment around us at any given time.

My friend Dan Egan at Betterment likes to say “You can’t change an investor, but you can change the context in which that investor invests.” Words – particularly emotionally charged, descriptive adjectives – can influence feelings. Feelings can get in the way of logic and reason. One of the biggest challenges advisors face when working with individuals is helping them compartmentalize these feelings during the financial planning process.

In the Stone Age, advisors would check boxes on a risk tolerance questionnaire and then formulate portfolios based on them. In the 21st Century, we are not checking boxes and giving the customer what they want. We are doing deep dives into our clients’ lifestyles and giving the customer what they actually need.

NASA’s Pioneer mission lived up to its name when it became the most remote object ever made by man after launching in 1972. Pioneer 10 traveled to within 80,000 miles of Jupiter and is now over 8 billion miles away from earth. Our Pioneer portfolio is designed for investors who, similarly, have a long way to go both in time and potential returns. With target allocations of 70% in stocks and 30% in fixed income, this strategy is expected to deliver long-term growth with enough stability to persevere into the unknown.

Is Pioneer the right portfolio strategy for you? Ask a financial advisor today.

See also:

Viking (TRB)

Mariner (TRB)

Explorer (TRB)

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