The Institutional Real Estate Inc Sponsorship brochure, Connected-Investor Focused, We connect people, data and insights, sponsorship, events, IREI Products
Issue link: http://read.uberflip.com/i/1058204
[ NOTES & TRENDS ] I f you want to get an investment professional's heart to skip a beat, refer to the investment choices they make as "bets." Advisers and money managers are fastid- ious about making clear they are absolutely, positively not gambling with people's precious, hard-earned money. But why? Let's think about this rationally. Nobody entrusts their investable assets with a wealth adviser without knowing there is some risk of some monetary loss, and virtually zero risk of losing the full sum of their investment. By contrast, there are millions of Americas who wager billions of dollars per year at casinos, online gambling sites, and legal and illegal sports-betting syndicates, all of whom know financial losses are virtually a given. H2 Gambling Capital, a market data firm, estimates that U.S. citizens lost $117 billion on gambling in 2016, and that results in an additional annual cost of $17 billion in gambling-associated problems such as crime, addiction and bankruptcy. Yes, addiction. Compulsive gambling is a form of addiction that becomes worse over time, according to the National Council on Problem Gambling. Imagine if the private wealth industry could appeal to those millions of gamblers around the nation by offering them "bets" whose odds were slanted far more in their favor and could produce infinitely more rewarding outcomes? I have argued for many years that investing is the thinking person's gambling casino. It makes so much more sense than throwing money away at, say, a casino that is literally rigged in the house's favor. Take, for example, the Las Vegas Sands, listed as the world's largest casino after sweeping $12.9 billion off its tables in 2017. What incentive does the Sands — or any other casino or online gambling site — have in tilting the odds in its customers' favor? Zero. And, yet, casino customers return again and again to have their pockets emptied. Meanwhile, where is the allure for the gambling-addicted legion for moving their chips over to the private wealth industry? Imagine having clients obsessed with plac- ing bets on stocks and bonds, on real estate and farmland plays, on fossil fuel and cryptocurrency gambits — people who keep calling or visiting the office to insist on getting a piece of a new interval or debt fund, or a new cannabis or blockchain opportunity. Alas, when terms such as "betting" and "gambling" are forbidden among private wealth professionals, what chance does an RIA or broker/dealer have for creating the kind of excitement required to attract these high-adrenalin spenders with a tolerance for high-risk bets. I get that the private wealth industry, which deals with trillions of dollars in AUM, might sniff at forecasts that gambling will grow to $495 billion worldwide in 2019, Bringing the jackpot mentality to RIAs What if private wealth lost its mind and bet on the gambling business? By Mike Consol, Editor, Real Assets Adviser A publication of Institutional Real Estate, Inc. PRESIDENT & CEO Geoffrey Dohrmann CHIEF OPERATING OFFICER Erika Cohen PUBLISHER & SENIOR VICE PRESIDENT, MANAGING DIRECTOR OF BUSINESS DEVELOPMENT Jonathan A. Schein MANAGING DIRECTOR Jennifer Dohrmann-Alpert EDITORIAL DIRECTOR Larry Gray EDITOR Mike Consol ART DIRECTORS Maria Kozlova Susan Sharpe CONTRIBUTING EDITORS Jody Barhanovich Drew Campbell Loretta Clodfelter Denise DeChaine Jennifer Molloy Andrea Zander VICE PRESIDENT, MARKETING Sandy Terranova MARKETING & CLIENT SERVICES Robin Buser Taylor Gray Michelle Raab Michelle Tiziani BUSINESS DEVELOPMENT Elaine Daniels Cynthia Kudren Karen McLean SPONSOR SERVICES MANAGER Linda Ward SPONSOR SERVICES Karim Garcia DATA SERVICES MANAGER Karen Palma DATA SERVICES Justin Galicia Alicia Block CONFERENCE DIRECTOR Lucero Jaramillo CONFERENCE SERVICES Melissa Benson John Hunt Jenny Krasnovskaya CONFERENCE SPONSORSHIP SALES MANAGER Randy Schein ACCOUNTING MANAGER Jennifer Guerrero ADMINISTRATION Lauren Gutierrez 4 REALASSETS ADVISER | D E C E M B E R 2 0 1 8