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Adapted from Charlotte Beyer’s 2017 book, Wealth Management Unwrapped, Revised and Expanded, comes a new term—relationship alpha, a competitive advantage for firms serving private clients.

Relationship Alpha: The Emerging Competitive Advantage in Wealth Management

View the full brief (PDF)


Adapted from Charlotte Beyer’s 2017 book, Wealth Management Unwrapped, Revised and Expanded, comes a new term—relationship alpha (α), a competitive advantage for firms serving private clients and more predictive and longer lasting than traditional measures like alpha or beta. While Beyer’s book is addressed to investors, the Appendix (reprinted here) is addressed to advisors. Each of the “10 Principles of Principal” Beyer presents for investors has a corollary that a firm can apply to its management processes, culture, marketing methods, and client service protocols. Expanding on these 10 best practices, the author explains how relationship a can be securely and successfully embedded into a firm’s everyday activities, earning the trust and loyalty of private clients.


Book knowledge and behavioral finance expertise can take a firm only so far. Although so-called soft skills are often dismissed as less important than “hard” analytical skills, relationship alpha (α) is a reinvention of the client experience. By balancing the power of EQ (the emotional quotient) with IQ, advisors can use relationship a to enhance every aspect of their client relationships—for the benefit of both the clients and the firm. Earning trust is only the first step; engaging the client (or prospective client) in a genuine dialogue is next and creates true relationship α. Such a dialogue sounds nothing like a skilled analyst drilling down into a company’s balance sheet with the CFO. Private clients rarely respond well to such intense examination because their wealth often inspires a fear of being “taken” or fooled, so any dialogue requires skills beyond the tired script of the traditional salesperson.

Within this brief are training exercises for a firm’s professionals, the tool of quadrants of sophistication and control for inspiring a dialogue, and five questions to ask clients in order maintain relationship α. Also included are ways to design more successful client reports and create more engaging client meetings.

More controversial in this brief is the author’s call for a firm to reexamine several assumptions embraced yesterday but damaging to any firm in today’s competitive market. For example, not every senior professional of a firm is suited for the initial marketing to a prospect. Not every CFA charterholder, brand-new or veteran, can learn how to effectively interact with clients. Relationship α requires a continual and rigorous review of the client experience within the context of each firm’s unique constraints and resources. Citing examples from the most successful advisors, this brief serves as a step-by-step guide toward transformation of an advisory practice—moving from an archaic business model under attack into a profitable firm inspired by a clear code of conduct, true engagement of all professionals, and highly satisfied clients.

About the Author(s)

Charlotte Beyer
Charlotte B. Beyer

Charlotte B. Beyer is founder of the Institute for Private Investors, where she served as CEO. She co-created the first private wealth management curriculum developed specifically for ultra-high-net-worth families at the Wharton School of the University of Pennsylvania, where she was named a fellow of the Aresty Institute. Ms. Beyer is the author of Wealth Management Unwrapped: Revised and Expanded and “Relationship Alpha,” a CFA Institute Research Foundation brief. She is a lifetime trustee of the Westover School, an all-girls school, and she founded the Principle Quest Foundation, a private nonprofit foundation whose mission supports innovative education and creative mentoring programs for girls and women, with a focus on racial justice and gender equity. Ms. Beyer is a graduate of Hunter College.