Timely template letter: Pulling the plug on statement shock (Summer 2003 edition)

(July 2003) Although there is a sense of optimism and feeling of momentum surrounding the economy recently, corporate profits and the performance of the stock market, your clients — depending on the type of investments they hold — may still be disappointed when they open their semi-annual statements over the coming weeks. Send out this customizable template letter to remind them that you’re closely monitoring their portfolios and that their long-term plans are as solid as ever.

Dear [Client’s name]

Now that summer’s fully upon us, I hope that you and your family have had a chance to get out and enjoy the weather. While the temperatures have been warm, I’m sure you’ve also noticed that the climate in the stock market has still been a little chilly.

In the next few weeks, you will be receiving your semi-annual investment statements. Depending on the sort of investments you hold, you may notice that the value of your investments has not grown as much as you anticipated or has declined.

In moments like these, it’s important to remember that we have designed a portfolio for long-term growth. Short-term downturns like the one we’ve lived through over the past few years are inevitable, but the diversified portfolio we created to match your risk tolerance can weather this storm.

History can help us put times like these in proper context.

When Iraq invaded Kuwait in the late summer of 1990, European markets fell by 20%. Newspaper headlines warned of impending recession and economic hardship. By the time the Gulf War ended in late February 1991, however, the European markets had actually rallied by 25%.

In fact, despite all the wars and conflicts that took place between 1957 and 1997, there were no 10-year periods with negative returns on the Toronto Stock Exchange during that time. Markets may have been down in single years, but overall the trend was up.

I hope you’ll bear this in mind when your statements arrive over the next few weeks.

As always, I’m completely at your disposal should you have any questions about your statements. If you would like to book an appointment to discuss your individual situation or overall financial plan, I hope you won’t hesitate to contact me.

Enjoy the rest of your summer!

Warm regards,

[Your signature]

[Your name]

(07/07/03)

Staff

The staff of Advisor.ca have been covering news for financial advisors since 1998.