Managing money is only part of an advisor's job. Managing expectations is often the far more important responsibility. In this episode of the Financial Advisor Marketing Playbook, Mark Mersman sits down with Josh Kneller of Atlas Capital Management to discuss the realities of investor behavior, advisor communication, and what it takes to build lasting trust through both strong and difficult market environments.
Drawing on decades of experience that span Wall Street, retail advising, and institutional asset management, Josh shares a perspective shaped by multiple market cycles, including the dot-com crash, the financial crisis, and the many periods of volatility that have followed. While markets change, one thing remains remarkably consistent: investor emotions. According to Josh, advisors and investors often react in similar ways during uncertain times, becoming vulnerable to fear, performance chasing, and short-term thinking.
A major theme throughout the conversation is expectation management. Josh argues that advisors spend too much time focusing on performance and not enough time preparing clients for reality. One of his most memorable principles is a promise he makes repeatedly to both advisors and investors: "I promise I'm going to lose you money." While initially surprising, the statement serves an important purpose. Losses are inevitable in investing. By acknowledging that reality upfront, advisors can remove unrealistic expectations and establish a foundation of trust before market volatility arrives.
The discussion explores how advisors should communicate during prolonged bull markets, when investor confidence often reaches its highest levels. Strong returns can create the illusion that risk has disappeared and can encourage both clients and advisors to become complacent. Josh believes these periods present some of the best opportunities for advisors to proactively discuss future risks and prepare clients for the fact that market cycles always change. Rather than focusing solely on recent performance, advisors should be reinforcing the importance of process, discipline, and adaptability.
Another valuable takeaway centers on performance chasing. Markets inevitably create winners and losers over short periods, tempting investors to compare results against neighbors, friends, benchmarks, and headlines. Josh cautions against these comparisons and encourages advisors to keep the conversation focused on individual goals and objectives. Every portfolio should be evaluated according to its ability to help a client achieve their desired outcomes, not merely against what someone else claims to be earning.
The episode also addresses one of the most difficult situations advisors face: handling periods of underperformance. Josh believes advisors should avoid becoming overly defensive when strategies fall out of favor. Instead, they should focus on explaining the role of market cycles and evaluating performance over meaningful periods of time. If a strategy consistently fails to add value over a full market cycle, change may be warranted. But making decisions based on short-term frustration often creates more problems than it solves.
One particularly insightful discussion examines how advisors can better uncover a client's true risk tolerance. Traditional questionnaires may satisfy regulatory requirements, but they often fail to capture how investors actually behave when markets decline. Josh advocates using historical market downturns as educational tools, helping clients visualize how they would react during periods of significant losses. These conversations create a more realistic understanding of risk than simply checking boxes on a form.
The conversation also shifts toward practice management and advisor growth. Josh explains that many of the fastest-growing independent advisors have embraced specialization and delegation. Rather than trying to be expert planners, investment managers, product specialists, and marketers simultaneously, successful advisors increasingly focus on their highest-value activities while leveraging specialists for other functions. This allows them to spend more time strengthening client relationships and less time attempting to master every aspect of the business.
Atlas Capital's own evolution serves as an example of this principle. What began as a retail advisory business gradually transformed into an institutional asset management firm after recognizing where its greatest strengths and opportunities existed. By concentrating on investment management and partnering with advisors, the firm found a model that allowed it to create greater value at a larger scale.
Josh also shares a framework that every advisor can apply immediately. In his view, every client sees their advisor in one of three ways: as an opportunity, as irrelevant, or as a threat. Advisors who are viewed as opportunities provide value, insight, solutions, and guidance that clients cannot easily find elsewhere. Advisors viewed as irrelevant risk losing clients over time. Advisors viewed as threats come across as product-focused salespeople rather than trusted professionals. Building a successful practice requires intentionally positioning yourself as an opportunity in the lives of your clients.
As the discussion concludes, Josh reinforces the importance of communication. Whether markets are soaring or declining, proactive communication helps advisors strengthen trust and create opportunities for deeper relationships. The advisors who succeed over the long term are often not those with the most complex portfolios or sophisticated strategies. They are the ones who consistently communicate, manage expectations, and help clients stay focused on their long-term goals.
Ultimately, the episode serves as a reminder that investing is as much about psychology as it is about performance. Advisors who understand that reality and build their practices around clear communication, realistic expectations, and disciplined decision-making position themselves to better serve clients through every stage of the market cycle.
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