Moving forward, she opined, advisors will have to differentiate themselves with the services they provide, not the investments they use.
Quinn is a proponent of the simplicity of passive investing in index funds for its low costs and ease of use.
“My sense is that a rising number of RIAs are going passive to make rebalancing easier,” she said. “Index investing allows them to distinguish their services. It’s efficient, inexpensive and to be honest, better. It’s becoming a mark of sophistication to manage money simply.”
Indexing works especially well for younger investors, said Quinn, but as clients age advisors will have to broaden their areas of expertise to create personalized solutions to their financial needs.
“The RIA who has a forward-leaning practice will deal with clients who want these solutions,” she said. “The simple ‘how are my investments doing?’ conversation is so 1980s. The new conversation is ‘what do you want for your money?’”