What Are Investment Advisors?

The UK is one of the most important financial countries in the world. The finance industry is one of the key components of the UK economy. Indeed, because of its heritage and strategic location, London is known as the financial capital of the world and the London Stock Exchange (LSE) is one of the most followed indexes in the world. More than 2,600 companies are listed in the LSE. More than 1,100 Exchange Traded Funds (ETFs) are listed in the exchange, giving it a 40% market share in Europe. In this article, we will look at the best process of finding investment financial advisors in the UK.

Who is an Investment Financial Advisor?

A financial advisor is a professional who guides clients to make sound financial decisions. The industry is very wide because people have multiple financial needs. For example, there are people who require retirement planning services. Retirement financial advisors help them come up with a saving strategy with the goal of preparing for retirement. Tax financial planners, on the other hand, help people and businesses pay their taxes on time.

An investment financial advisor is a person who sits down with a client, analyses their situation, and comes up with a strategy to invest their money. The advisor needs to be someone who is experienced well in the financial industry. Investment advisors are regulated by the Financial Conduct Authority (FCA). They are regulated to prevent unscrupulous individuals from taking a leading role of financial advisory. The regulations also help to prevent conflicts of interest in the industry. Before regulations were tightened, it was common for an investment advisor to tell a client to buy stocks of company A while they were shorting it. As a result, an investment advisor must disclose to their clients their relationship with the companies they recommend.

What does UK Investment Financial Advisors do?

Most people in the UK don’t know how to identify valuable investment products. This is the reason why many of them have lost money after investing in stocks, peer-to-peer investment companies, and real estate. In addition, most people don’t know how to create portfolios with their money. Investment advisors fill this gap by looking at a client’s situation and recommending the best assets to invest in. These assets include stocks, exchange traded funds, index funds, bitcoin, and mutual funds. They also consider non-financial investment products like real estate and other alternative assets like art, watches, and sneakers. Investment advisors are sought by regular people and wealthy individuals. Some of the most common people who seek financial advisors in the UK are sports people who earn big money. They are also sought out by young entrepreneurs and people who are close to retirement.

Where Investment Financial Advisors Work

Investment financial advisors work in various places in the UK. There are those advisors who work in big investment firms in the UK. The biggest investment companies in the UK include Aviva, Schroders, Blackrock, Legal & General, and Blackrock. Investment advisors also work as investment brokers. Here, they talk to clients who want to invest in stocks and other financial assets. Some of the biggest brokers in the UK are IG ShareTrading, JP Morgan, Halifax, Barclays, and ClubFinance among others. Other investment advisors work in the media. There are many registered financial advisors in the UK who work in the television and print media in the UK. There are other investment advisors who have set up their boutique investment advisory firms. These firms offer independent advice to customers. Some of the most popular investment boutique firms in the UK are Hannay Robertson, Solomon’s IFAs, Portland Advisors, and Cantab Asset Management among others.

The Cost of Financial Advisors in the UK

Financial advisors are not free. As with all industries, advisors charge their clients different fees. There are those advisors who charge per hour and those who charge per project (flat fee) or percentage of your asset. The hourly rate can range from £30 an hour to £350. According to the Financial Conduct Authority, the cost for those who charge a percentage of your investment is 2.4% of the amount invested for initial advice and 0.8% a year for ongoing advice. Ideally, the fee a financial advisor will charge you depends on the amount of money involved.

Is it Worth It to Hire an Investment Financial Advisor?

As seen above, hiring a financial advisor can be an expensive undertaking. To some, it would not make sense to spend all this money in an investment advisor. However, to most people, hiring a good investment financial advisor is a great thing because they can help you find good investments. They can also make you avoid the common mistakes that many people make. In the past, we have seen many people lose money in investment scams in the UK.

Summary

Investment financial advisors are trained people who look at your financial situation, assess your financial goals, and then recommend the best investment products to make. While advisors can be expensive, they can help you make sound investment decisions. You must sure you agree up front how much you will be charged and how you need to make payment.

Crispus is a finance professional with more than a decade experience in the industry. Over the years, Crispus has written in-depth articles on leading platforms like CCN, Marketwatch, and Seeking Alpha. He also runs a Forex education and managed account company called WestEndFx.