The last ten years in investment markets has been a rough ride what with the dot com bubble, the Twin Towers disaster and the Global Financial Crisis amongst other things. The investment recommendations of financial advisers have been under close scrutiny and some have found themselves in court. Good advisers use a thorough process for making investment recommendations, starting with a comprehensive interview with prospective investors, leading to analysis and research, portfolio design and finally product recommendations. Failure to understand an investor’s attitudes towards risk and return and failure to understand product risk have been the two primary causes of complaint against advisers. Recommending products from the thousands available in the market requires extensive research. For small advising firms this is simply not cost-effective and many purchase research from specialist research companies. Increasingly, advisers are using what are called ‘model portfolios’. These are portfolios researched and designed by experts to fit a range of investment profiles from conservative through to aggressive. With any investment portfolio, the key decision to be made is how the portfolio is split between the four asset classes of cash, fixed interest, property and shares. The adviser’s principal responsibility is to recommend the most appropriate split based on their understanding of the investor and to then select a fully researched portfolio of investment products based on that split. There are several advantages of using model portfolios for both investors and advisers. For investors, there is the confidence of knowing that the portfolio has been extensively researched and is constantly monitored for performance. Adviser time is spent with investors, understanding their needs, keeping them up to date with market information and answering their questions. For advisers, the risk of recommending inappropriate products is considerably reduced. Model portfolios make good sense and their use is bound to increase.