Compliance makes social networking tougher for registered reps than RIAs

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Here’s a guest post by Bill Winterberg, CFP®, an operations and efficiency guru to independent financial advisers, who blogs at FP Pad. He made me realize that RIAs have more leeway than registered reps when it comes to social networking.
Websites like Twitter, LinkedIn, and blogs present compliance issues for registered representatives subject to FINRA regulations. All reps must obtain approval from the broker/dealer compliance department before posting anything on the Internet, as postings a considered advertisements.

FINRA has published guidelines for use of the Internet by registered representatives of broker/dealers. It’s worth reading if you are affiliated with a broker/dealer.

The SEC has similar guidelines that govern advertisements, including postings to public Internet forums. However, investment advisers are generally responsible for self-supervision by Chief Compliance Officers. In my opinion, investment advisers not subject to FINRA regulations have quite a bit more flexibility when using Internet and social networking websites. See http://www.sec.gov/divisions/investment/advoverview.htm and http://www.sec.gov/info/iaicccoutreach.htm.

RIAs definitely have more flexibility over registered reps when it comes to the use of the Internet. However, common sense must always prevail when using the Internet to avoid publishing security recommendations or any testimonial, which are explicitly prohibited by the SEC and state regulatory authorities.


Top 10 tips for CFA charterholders considering freelance writing

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If you’re a CFA charterholder considering a freelance writing career, here’s advice from Omar Bassal, CFA. Omar is the head of asset management at NBK Capital, a freelance writer, and the author of Swing Trading for Dummies. 

I’m posting Omar’s article as part of my preparation for a panel on “Alternative Careers for CFA Charterholders” to be presented to the Boston Security Analysts Society on January 14, 2009.

Here’s Omar’s advice.


1. Choose your work carefully: Part of being a good writer is choosing the right businesses and people to work with. There are a lot of fly-by-night operations that want text to fill space. While they might pay the bills, they won’t further your professional development.

2. Get a proofreader: No one is perfect—not even CFA charterholders. Having a second pair of eyes before you submit your work is always smart. Find a reasonably priced person via Craigslist.

3. Know your audience: Be able to differentiate between unsophisticated audiences (where “standard deviation” is too technical a term to use), semi-sophisticated audiences (where “standard deviation” needs no further explanation) and sophisticated audiences (where “standard deviation” is an incomplete view of risk).

4. Get paid by work, not by hour: Firms will want to pay you by the hour. But you should push to be paid a flat rate for your work. This doesn’t always mean you’ll get more. But over time, you’ll be more efficient and productive as a result. Plus, you won’t need to keep tabs on every minute you’re working versus checking e-mail.

5. Seek contracts: Monthly and quarterly newsletters and reviews are an excellent way to get your hands on steady income.

6. Network with other writers: There are many fish in the sea and writing as a CFA charterholder doesn’t mean you’re taking away business from a fellow CFA charterholder. Sometimes clients will come to you with requests that you’re unwilling or unable to do. Being able to pass that work onto other contacts means your client feels his/her needs are being met by you. Do it often and others will return the favor.

7. A CFA charter does not mean you know everything: If you’re an expert in equities, you may find navigating fixed income waters tough. Make sure you thoroughly understand what you’re getting into before you agree to do a job.

8. Have a contract: Approach writing as you would any other business. Have a contract in place for every writing job which explains  your responsibilities, your contractor’s expectations, delivery schedules, terms of cancellation and prohibition of passing your work on to other parties. Besides protecting your interests, a contract will flash a signal that you’re a professional writer.

9. Seek out non-traditional clients: Realize that your easiest business may come from non-traditional clients. “Traditional clients” may be mutual funds, financial advisors and institutional asset management firms. Non-traditional clients include trade groups with pension plans, foundations, endowments and other less sought after institutions.

10. Punctuality is everything: Don’t view your text as the finish line for your contractor. Your work will likely be checked by senior staff or formatted for e-mailing or printing—all things based on firm schedules. Treat your work as a business. Being late means being unreliable—no matter how great the final text may be.

"3 Reasons Why Your White Papers Might Fail to Bring in New Business "

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Winton Churchill offered three “Reasons Why Your White Papers Might Fail to Bring in New Business” in a White Paper Source post that’s no longer online. But his reasons are still relevant.

I list his reasons below and give my take on how they apply to the investment business. 

  •  “#1. Preaching to the choir“: For example, if your white paper pitches municipal bonds to high-net-worth investors who’ve been getting professional advice, they probably already have munis in their portfolios. Maybe it’s time to seek out the newly wealthy or do-it-yourself investors.
  • “#2: Cradle to grave“: Don’t try to cover your topic from A to Z because you’ll lose your reader in a morass of details.  With munis, that might mean focusing on the potential tax benefit and relegating your caveats about AMT paper to a sidebar.
  • “#3: Company-focused instead of issue-focused“: As the author says, “Too many white papers boast.” Ironically, that’s a quick way to lose credibility. It’s far better to offer valuable information, then end with an enticement for your prospects to contact you.

Do white papers that make these three mistakes turn you off?


April 23, 2018: This post was updated because Churchill’s article is no longer available online.

Lesson from a headline, "A 30-Year Treasury Bond: Probably One of the Most Dangerous Investments You Could Make"

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“A 30-Year Treasury Bond:  Probably One of the Most Dangerous Investments You Could Make” is a great headline. It’s also a great topic.

Why? Because it challenges the average person’s idea of what’s a safe investment. Turning a common idea on its head will attract readers. In this case, it will also do them a service by explaining the downside of investing in 30-year Treasuries.

Kudos to RegentAtlantic Capital for an excellent headline and story idea for their recent press release.

"Narrow slice" article topics are better

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An article that covers a topic exhaustively can exhaust the reader. Writing about a narrow slice of that topic can be much more engaging.

This quote by New York Times health columnist Tara Parker-Pope, in Maura Casey’s “Tips, Tricks & Rewards of Writing Short,” makes a similar point:

“Kitchen sink stories do too much…. If you take on a big, unwieldy topic, you can wind up with a big, unwieldy story. Our writing improves when we try to do a little less, but do it better.” 

So, the next time you write about, for example, the bond market, don’t try to cover everything. Pick one slice that reflects an important development in that asset class.

Don’t trust your spell-checking software

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Automated spell-checking won’t eliminate typos in your writing. Human intervention is also essential.

Can you find the typo in the following sentence, which appeared in a national magazine this week?

What’s more, firms must have adequate risk management to make sure that managers aren’t taking undo risks to boost returns, he said.

Meanwhile, to catch your typos, read your text out loud or get a colleague to proofread for you.

"Alternative Careers for CFA Charterholders" on Jan. 14

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I’m one of four panelists presenting to the Boston Security Analysts Society (BSAS) on “Alternative Careers for CFA Charterholders” on January 14.

Among the four of us, we have experience as a due diligence analyst, treasurer, investment technology salesperson, consultant, and writer. We’ll help you understand what each job involves and how you can target your job hunt.

In addition to my role as panelist, I’m a member of the group planning career development events for the BSAS. So, I’m interested in your ideas for other career-related events for CFA charterholders.

Please join us on January 14 if you’d like to learn more about alternative careers.

"Discover hundreds of post ideas for your blog with mind mapping"

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I’m a big fan of mind mapping as a way to organize your ideas before you start writing. But you can use mapping to brainstorm ideas for blog posts.


Problogger Darren Rowse tells you how in “Discover hundreds of post ideas for your blog with mind mapping.”


Rowse suggests that you list topics that you’ve already blogged and then brainstorm spin-offs from them.

Should you say "No" to "Please"?

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People feel passionately about “please.”

“Common sense might tell you that adding ‘please’ or ‘thank you’ to an email will always make it more polite. Common sense would be wrong.” That’s according to David Shipley and Will Schwalbe in Send: Why People Email So Badly and How to Do It Better.

I decided to ask the participants in my workshop on “How to Write Effective Business Emails and Letters” if they think “please” should be optional. “No way!” was their response.

I agree that it’s good to leave “please” in your vocabulary. I’m puzzled by Shipley and Schwalbe’s assertion that it’s “almost impossible to use please in writing without coming across as obnoxious.”

Do you use “please” in emails? Please leave a comment below.

"The Ten Biggest Mistakes Case Study Writers Make" by Casey Hibbard

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Before you write case studies for your wealth management or financial planning business, read “The Ten Biggest Mistakes Case Study Writers Make” by Casey Hibbard (registration required). You can learn from her tips, even though her article is geared to professionals writing for technology companies.

“Ignoring the Audience,” Hibbard’s number one “don’t,” is also the most common mistake that financial advisors–and all business people–make when they write. Gear your case study to the issues that most concern your potential clients.

“#5 Not Digging for Results Data” is another mistake. A case study typically includes a problem, a solution, and results. A case study saying the client “saved $1 million in taxes” will be more powerful than a similar case study that doesn’t quantify the results.

“#9 Not Catering to Readers or Skimmers” afflicts many of the marketing materials I read. People have short attention spans. So you’ve got to cater to skimmers in addition to the folks who’ll plow through every word you write. As Hibbard says, you can make your writing easier to scan using:

  • A headline that conveys “your number one idea”
  • Subheads that convey your main points
  • Pull quotes that highlight engaging customer quotes
  • Sidebar summaries

A case study is a great way to show that you’ve solved problems for people like your prospective client. However, step carefully around investment management issues. Remember the SEC’s prohibition on testimonials for registered investment advisors.