Who is this course for?
What is different about it?
What is included?
Module 1: Behavioural finance & the subconscious mind
- This module provides the foundation. It discusses how behavioural finance fits with traditional financial theories and models, and the 6 major decision-making biases advisers should look out for in their client engagement. 50 mins
- Learning outcomes:
- How behavioural finance fits in with the traditional financial theories and practices that advisers are probably already familiar with.
- An introduction to the ways that advisers can use behavioural finance to enhance their existing approaches to working with clients.
- Six key decision-making concepts that underpin many of the client decision-making problems advisers are likely to encounter, including how they typically influence clients’ decisions, and how each creates opportunities for advisers to better understand, engage with and influence their clients.
0.75 CPD Points (0.5 Client Care & Practice, 0.25 Technical Competence)
Module 2: Risk Tolerance, perceptions & profiling
- This module covers the psychological challenges advisers face in understanding and measuring their clients’ risk profiles and how to enhance client conversations about risk. 55 mins.
- Learning outcomes:
- The psychological challenges advisers face in understanding and measuring their clients’ risk profiles, in translating them into investment recommendations, and in communicating risk-related issues.
- The psychological forces that underpin clients’ risk-related decision, actions and preferences, including how and when they vary from what is theoretically “rational” or optimal, and how they vary by gender, by age, and across personality types.
- Ways to apply behavioural insights to improve the use of risk profiling tools, to enhance client conversations about risk, and to ensure clients truly understand and accept the risks that they take.
1.0 CPD Points (0.5 Client Care & Practice, 0.5 Technical Competence)
Module 3: Happiness, motivation & future goals
- This module covers how advisers can apply psychological insights to assist clients to set goals that will lead to their long-term happiness and life satisfaction, that are meaningful for them, and that they will feel motivated to achieve. 45 mins.
- Learning outcomes:
- How advisers can apply psychological insights to assist their clients to set goals that will lead to their long-term happiness and life satisfaction, are meaningful for them, and that they will feel motivated to achieve.
- The psychological forces that can lead clients to change their goals over time, how advisers can anticipate these changes, and how they can ensure that their advice continues to align with their clients’ changing goals.
0.75 CPD Points (0.5 Client Care & Practice, 0.25 Technical Competence)
Module 4: The misunderstood role of financial literacy
- This module covers how financial advisers can provide effective financial education to their clients, such as by focusing more broadly on clients’ financial skills, attitudes and behaviours. 40 mins.
- Learning outcomes:
- Why traditional approaches to financial education typically fail – why most people don’t learn and remember what is taught, or act on the information that is provided.
- How financial advisers can provide effective financial education to their clients by focusing more broadly on clients’ financial skills, attitudes and behaviours, and by designing financial education that is broken into small bite-sized pieces that are delivered ‘just-in-time’.
- Other psychological strategies that financial advisers can use to help clients with low financial literacy to make the right choices and to take actions that increase their financial well-being.
0.75 CPD Points (0.5 Client Care & Practice, 0.25 Technical Competence)
Module 5: Market cycles & the behavioural rollercoaster
- This module covers psychological strategies that advisers can use in their client conversations, advice documents, investment reports and other client communications to help clients across market cycles. 50 mins.
- Learning outcomes:
- The psychological factors that can impact clients’ decision-making across market cycles, including the role of pattern-recognition errors and of over-looked opportunity costs.
- A range of psychological strategies that advisers can use in their client conversations, advice documents, investment reports and other client communications, including the use of pre-commitments and frictions.
- How these strategies can nudge clients to make better investment decisions across market cycles and reduce the risk that they blame their advisers for losses.
0.75 CPD Points (0.5 Client Care & Practice, 0.25 Technical Competence)
Module 6: Exploiting behavioural biases in markets
- This module covers the key decision-making biases that underpin three market ‘anomalies’ that clients can potentially benefit from: the value effect, momentum and the quality effect. 50 mins.
- Learning outcomes:
- The key decision-making biases that underpin three market ‘anomalies’ that clients can potentially benefit from: the value effect, momentum and the quality effect.
- How these decision-making biases can impact both sophisticated and unsophisticated investors, including in the way they forecast company earnings and assess CEO behaviour.
- How advisers can overcome some of the challenges that they face in helping clients to capture the benefits of these ‘anomalies’, including how they can reduce the risk of clients abandoning good strategies during periods of short-term underperformance, or of resisting good investment ideas that feel counter-intuitive.
0.75 CPD Points (0.5 Client Care & Practice, 0.25 Technical Competence)
Module 7: Biases in diversification and asset allocation
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- This module covers the psychological strategies that advisers can use to help their clients make better diversification and asset allocation decisions, including in the way advisers frame and present investment choices to their clients. 40 mins.
- Learning outcomes:
- The psychological biases that can lead clients to miss out on the risk-reduction benefits of diversification and to choose unsuitable asset allocations, including the roles of familiarity and over-confidence.
- How investment advice can also be influenced by powerful unseen biases, such as in the way asset allocation models are constructed, and how advisers understand their clients’ investment preferences.
- The psychological strategies that advisers can use to help their clients make better diversification and asset allocation decisions, including in the way advisers frame and present investment choices to their clients.
0.75 CPD Points (0.5 Client Care & Practice, 0.25 Technical Competence)
Module 8: Advising overconfident investors
- This module covers the psychological challenges advisers face in engaging with overconfident clients (ie the types of clients who need assistance, but who might feel that they can make their own decisions). 55 mins
- Learning outcomes:
- The psychological challenges advisers face in engaging with overconfident clients (ie the types of clients who need assistance, but who might feel that they can make their own decisions).
- The psychological insights that advisers can use to influence and engage overconfident investors, including the ‘Ikea effect’ and the ‘Illusion of control’.
- How advisers can identify, avoid or mitigate some of the problems with different types of overconfident investment decisions, and how they can effectively communicate uncertainty.
1.0 CPD Points (1.0 Client Care & Practice)
Module 9: Residential real-estate decisions
- This module covers psychological strategies that advisers can use to help clients make appropriate property-related decisions that suit their needs and circumstances, even if the adviser does not provide specific property advice. 50 mins.
- Learning outcomes:
- The psychological challenges clients face in deciding whether to buy or to rent, and in choosing an appropriate property, including the often misunderstood connection between property and happiness, and the use of ‘optimal stopping’.
- How decision-making biases can lead clients to pay too much when buying a property at auction or via a private sale, and how they can make vendors reluctant to sell.
- Psychological strategies that advisers can use to help clients make appropriate property-related decisions that suit their needs and circumstances, even if the adviser does not provide specific property advice.
0.75 CPD Points (0.5 Client Care & Practice, 0.25 Technical Competence)
Module 10: Saving & retirement planning
- This module covers the psychological techniques advisers can use to help their clients achieve their savings goals, to choose appropriate insurance or guaranteed income products, and to address their clients’ cognitive decline. 65 mins.
- Learning outcomes:
- The psychological techniques advisers can use to help their clients achieve their savings goals, including identifying easy savings from psychological blind-spots and creating pre-commitments.
- The psychological challenges advisers face in helping their clients to choose appropriate insurance or guaranteed income products, and how they can refocus and reframe their clients’ decisions.
- How advisers can effectively identify, raise and address the possibility of their clients’ cognitive decline without putting their clients off-side.
1.0 CPD Points (1.0 Client Care & Practice)
Module 11: Client engagement & influence
- This module covers the psychological strategies advisers can use to enhance their client engagement, to build trusted and committed relationships with their clients and to demonstrate the value of their advice. 70 mins.
- Learning outcomes:
- Psychological strategies advisers can use to enhance their client engagement, helping to ensure that clients listen to and act on the advice they receive, whether it be delivered verbally or in writing.
- How advisers can use behavioural insights to build trusted and committed relationships with their clients, to demonstrate the value of their advice and to increase clients’ willingness to pay a fair price for it.
- How advisers can reduce the risk of misinterpreting their clients’ needs and preferences, particularly when what their clients say is not what they really mean.
1.25 CPD Points (1.25 Client Care & Practice)
Module 12: Ethics & technology
- This module covers how advisers’ recommendations can be impacted by ethical issues in ways that extend beyond their conscious awareness, and the psychological issues advisers face in using data and technology in their advice processes. 55 mins.
- Learning outcomes:
- How advisers’ recommendations can be impacted by ethical issues in ways that extend beyond their conscious awareness and control, and therefore why even advisers with good intentions can sometimes act unethically.
- Why seemingly logical approaches to avoiding, managing or disclosing conflicts of interest typically fail to improve client outcomes, and how psychological strategies can assist.
- The psychological issues advisers face in using data and technology in their advice processes, including how data insights can be misleading, how client interfaces can help but also hinder client engagement, and the risks of advisers over-relying on automated processes.
1.0 CPD Points (0.5 Client Care & Practice, 0.5 Profesionalism & Ethics)
Module 13: Practical challenges in implementation
- This module covers ways to address the practical challenges advisers face in using behavioural principles, to realise the most benefit for both advisers and clients, and to avoid the traps that can lead to inaction, resistance and inertia. 25 mins.
- Learning outcomes:
- Ways to address the practical challenges advisers face in using behavioural principles, including the fact that biases can apply differently for different types of advice, that they can sometimes offset, and that they can apply differently between clients.
- How to realise the most benefit for both advisers and clients, and avoid the traps that can lead to inaction, resistance and inertia, including by engaging colleagues in non-advice roles and by developing supportive mindsets.
0.5 CPD Points (0.5 Client Care & Practice)