Choosing an investment advisor or money manager should be a careful process based on diligent research. The best relationships start with a shared investment philosophy, followed by a building of trust through education and transparency.
There are many common misconceptions around financial advice, and there are several important questions to ask before you begin any new relationship.
To expand on that theme, I want to detail some red flags that often come up in my conversations with clients who have tried various quasi-advisors in the past. Many of these people have taken a part-time interest in investments — or they may not be who they say they are. Uncovering that information should be of vital importance to your wealth.
There are a great number of legitimate traders and investors on social media who run newsletters or other private services to help a select list of private clients. Over the years, I have befriended some genuine professionals whom I would reasonably let manage my own money if I weren't already in the business.
Then there are the guys with the pictures of Ferraris and supermodels in their profiles. They have online handles, like "billionairetrader92" or "darknightvixslayer." They want you to believe they turned $1,500 into $15 million in the last two years.