Dynamic Planner has partnered with a business school to launch a two-year study researching investor attitude to financial risk in a bid to improve communications between advisers and clients.
The risk profiling business and Henley Business School, part of the University of Reading, hope to produce research which will improve client outcomes in the advice market by preventing detrimental actions fuelled by behavioural biases.
The study aims to understand how investors behave when their investments fall in value, including their natural actions and how long these might take, with the ultimate goal of improving communications between advisers and clients to avoid rash reactions.
Chris Jones, proposition director at Dynamic Planner, said: "In today's society and regulatory environment every stakeholder benefits from the investor investing in a solution that is suitable, understood and remaining invested throughout their investment journey."
Mr Jones said these stakeholders were most importantly the investor themselves, but also the adviser, the asset manager, the regulator, the economy and "society as a whole".
He added: "Both data and behavioural science have become buzzwords in recent times, but rather than rely on interpretation of translation from other works we intend to go much further and focus on the scientific method."
Kevin Money, a professor at Henley Business School, said: "Henley Business School is proud to partner with Dynamic Planner on this project. We are both respected organisations in our field and it was therefore natural that we should both choose to work together on this long term study."
Mr Money said he was particularly interested in the emotions of anger and fear among clients, noting angry investors who, for example, had lost shares were more likely to be more risk seeking and those who were fearful more likely to be risk averse.
rachel.mortimer@ft.com
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