MEDIA REVIEWS - July 24-31, 2010

This issue of the Journal of Financial Planning features three articles which reinforce, in interesting ways, things you probably already know but may not be giving enough attention: the messiness of financial planning, and how you can turn that to your advantage in client relationships: the messiness of client thinking about investments and how you can protect your client relationship from it; and Vern Hayden talks about the essential core of your business and invites you to put more attention there, rather than on a lot of inessentials which probably take up most of your day.

I thought the article on using options to hedge client portfolios was interesting for two reasons: first, it found that hedging (buying options) all the time is prohibitively expensive; when markets are volatile, the cost exceeds the benefits. And second: it found that if you hedge in a disciplined way, only when the costs are low, you might be able to add risk-adjusted return to client portfolios.

The Economist articles warn us to brace for two major transitions in the Middle East; the leaders of both Egypt and Saudi Arabia are ailing, and there is no clear succession plan. And it tells us that the most recent bond auction selling Greek (and Spanish) debt went off without a visible hitch, which may mean the worst of the crisis in Euroland is over.