Let’s face it: after coming off a great year, the markets this year so far have been somewhat shaky. It is more important now than ever before to instill investor confidence. Here are five tips that you should follow to make sure you continue to build investor confidence and avoid redemptions. All five items below can be boiled down into one word: communication! Don’t hold back. Tell your investors the good, the bad and the ugly. A savvy investor can smell spin miles away, so don’t spin. Report facts and then your opinion.
1) Consider putting out a mid-quarter letter or even a mid-month letter aside from your normal communications.
2) Have a conference call for your investors. Set up a monthly or mid-monthly call to give your opinion on markets. Your professionalism will validate why they put their money with your fund.
3) Start a Web site blog. This blog can be public-facing, giving your opinions about the current conditions. Let’s face it: with the internet, there are very few secrets out there. So why not be bold and share your opinions with the investment world? Notice I said opinions, not secrets. Not only will sharing your opinions instill confidence with your investors, but by making your opinions public you may actually get you new investors.
4) Fix your broken Web site. Is your Web site tired? Does it look as if it was created in 1990? Time for an upgrade. A clean look and feel, along with charts and graphs, will make you look like a much more professional organization. You would not wear a suit from Target to pitch a large piece of business, would you? Then why should your Web site look as if an amateur created it.
5) Re-create your pitch book. Is your pitch book boring, flat and lackluster? You need to change it. You need to have graphs that are easy to understand and writing that is clear, concise and consistent with your brand. Of course, performance is most important, but a good pitch book will instill confidence should there be a bad quarter.