Citywealth Women in Wealth supper clubHow do women deal with Alpha male clients? Colin Cameron examines how they behave on the gambling tables and shows how we can understand what they will do in business or with their investments.
The Citywealth Women in Wealth Supper Club, a group for senior women in private wealth management, held its quarterly event at Alberico restaurant at Aspinals in Curzon Street, Mayfair on 25th January 2011 and chose this event to introduce speaker Colin Cameron who has written a book on gambling called Betfair, writes for Esquire Magazine and has a column in The FT. The topic on the table was a new take on risk—how gamblers make decisions on the tables and how those in private wealth management can learn from this behaviour to empathise with high risk taking ultra high net worth individuals.
Using the beautiful conservatory style restaurant for a champagne reception, the event allows members to network and be introduced before sitting down to hear the nights speaker with a glass or two of wine. The evening had chef Alberico introduce tapas style dishes to the table that included calamari, dim sum dumplings with prawn and bresaola slices. The deserts included handmade vanilla ice cream lollipops covered in chocolate and mini choux buns filled with berries and covered with candy pink icing.
Guests included names such as Caroline Butler, Lord North Street; Louise Stoten, New Quadrant Partners; Aida Molineux and Clare Flanagan, Northern Trust; Alison Parry, Legis Group; Catherine Bell, LG; Marie Laure Humbert, Iveagh; Camilla Stowell, Coutts Private Office; Cecile Civiale Vuillier, Bedell Trust Suisse; Helen Jones and Teresa Payne of BDO; Ursula Danagher and Lindsey Alexander of Memery Crystal who have just moved to the firm from Harcus Sinclair to set up a family division and Alex Luxo Piazza, IFG International.
The evening, as with all the Citywealth evenings went off like a champagne cork with revellers chortling as Cameron commented “risk is just like sex and drink, people always lie about it.”.
Cameron summed up his talk: Establishing and maintaining empathy with high net-worth clients can be made easier by understanding their attitudes to risk. In this, gambling – one of the purest forms of risk-taking - can be a useful staring point.
* Gamblers exaggerate or underplay their appetites for risk in a random way that makes analysis very difficult. Yet online bookmakers have found that gamblers are broadly more honest about their risk strategies when quizzed over the web.
Correspondingly, investment clients may actually be more candid in email correspondence than in face-to-face meetings. Equally, clients may reveal more about attitudes towards risk when considering investments other than their own, to which they may have an emotional and psychological attachment.
* In gambling peer pressure is hugely important in shaping attitudes to risk taking. As a consequence, new clients who come through existing clients may feel the need to embrace greater risks then those who recommended them. But this may not be a reflection of true attitudes to risk. This heightened appetite for risk may diminish with time.
* Edmund Bergler’s study of betting in the 1950s suggested that people gamble to reach a heighten state of elation from winning and the longer a gambler goes without success the more this is craved. Likewise, clients may be hungrier for risk the longer that their investments flat line. This will be especially true of new clients inherited as a result of a run of poor returns from advice elsewhere. Again, in reality this desire for greater risk taking may be temporary.
* Modern-day cognitive theories of betting are based on the “illusion of control”. Gamblers today like to feel that they are masters of the universe and risk taking is a route to this. Investors who seek this will be happy taking greater risks if it means they can ultimately be vindicated. With these clients, it may not be about the money. It may matter more to them that they are right. This preference for vindication over maximization of profit may be most common in the highest net-worth clients.
* Risk produces visceral reactions. People react to the prospect of risk physically. Animation gives away the inner thoughts of an investor. You can spend much time listening to a client but it might be better also to look more. The actions of risk takers and how they communicate may say more about attitudes to risk than their words. Subtle changes to body language may indicate more substantive changes to risk mindsets.
Memberships for the Citywealth Women in Wealth Supper Club cost £950 + vat a year to join for four events.
contact: jbell @ j-p-c.tv
Tel: 020 7224 9565
Karen Jones, pictured above far right top runs these events each quarter. She founded Jones Publishing in Oct 2005 and started with one pdf newsletter. The company now has two print publications, one app, one fully archived website, twenty events a year including two awards ceremonies for circa 400 individuals.
Karen Jones, Editor, Citywealth is often called The Liz Hurley of the finance world. Her most interesting experience was doing the Bobsleigh in Calgary. 1,500 metres in ten seconds. She has also travelled from the Arctic Circle to Antarctica. She regularly provides commentary to The Evening Standard and Daily Mail on the habits of the wealthy particularly wealthy arabs and their luxury lifestyle spending habits.
Karen Jones, Editor, Citywealth is a confident, public speaker recently presenting at the Financial Services Forum on the future of Switzerland. Aswell as this she hosts fashion and charity events as MC for friends.