In 2001 Vanguard devised the Vanguard Adviser’s Alpha concept, outlining how advisers could add value (alpha) through relationship-oriented services such as providing cogent wealth management in financial planning, discipline and guidance, rather than by trying to outperform the market.  This paper takes this framework further by attempting to quantify the benefits that advisers can add relative to others who are not using such strategies.  It focuses on the most common tools for adding value, encompassing both investment-oriented and relationship-oriented strategies and services.

Although the contents of the module are set in the US context, the underlying principles also apply in the New Zealand context.