Presented by Envestnet
On today’s episode, Doug talks with Dana D’Auria, Group President and Co-Chief Investment Officer at Envestnet. Dana shares how advisors can support clients through turbulent markets by staying connected, reinforcing long-term discipline, and ensuring portfolios align with risk tolerance. With volatility driven by headlines and sudden policy shifts, she highlights the importance of steady guidance.
Dana also unpacks how new tariffs are raising concerns around both inflation and slowing growth—reviving fears of stagflation. She stresses the role of customized solutions, especially tax-aware strategies, and draws on lessons from 2008 and COVID to show how thoughtful planning can make all the difference. In uncertain times, clear communication and a steady hand remain the advisor’s greatest tools.
Recorded at Envestnet Elevate 2025
Resources: Envestnet
Related: AI, Integration, and Innovation at Envestnet With Chris Todd
Disclosures:
The information, analysis, and opinions expressed herein are for general information only. The views expressed herein reflect the judgement of the speakers as of the recording date and are subject to change at any time without notice. Information obtained from third party resources are believed to be reliable but not guaranteed. Nothing contained in this document is intended to constitute legal, tax, securities, or investment advice, nor an opinion regarding the appropriateness of any investment, nor a solicitation of any type. Investing carries certain risks and there is no assurance that investing in accordance with the portfolios or strategies mentioned will provide positive performance over any period of time. Past performance is not indicative of future results.
Transcript:
[00:00:00] Doug Heikkinen: This is Advisorpedia's Power Your Advice podcast, and I'm Doug Heikkinen. We're at Envestnet's Elevate Conference and we're joined by Dana D'Auria, a Group President and Co-chief Investment Officer at Envestnet. How are you?
[00:00:13] Dana D'Auria: I'm great. Thank you for having me.
[00:00:15] Doug Heikkinen: It's gotta be, Chief Investment Officer. . .
[00:00:24] Dana D'Auria: Yeah, I think anybody in the investment field right now. But on the other side of it, how do you really trade against this anyway, right? I mean, what chief investment officer is out there saying, yep, I've got the magic formula. I know what you need to do. I mean, we're all kind of saying the same thing, right?
Like, stay the course, take a deep breath, keep calm and carry on. I mean, I don't know anybody who's really trying to time this market,
[00:00:48] Doug Heikkinen: Right. So what should advisors be thinking?
[00:00:51] Dana D'Auria: Well, I mean, as a starter, be on the phone with the client, right? I mean, there's so many surveys that say, look, what they're looking for from you now in a time like this is communication.
They want to hear from you. So, I mean, I love that there's so many advisors here, and I really respect the fact that they took the time. Because you know that they're on the phone with the clients throughout the course of all this, and everybody's going to remember, I think where they were when, I had these big spikes, right?
I mean, we had, look at what happened Monday. You have a false report that there's going to be a reprieve on these tariffs. The market skyrockets. It turns out to be false. Market drops, right? And so I was on stage Wednesday, and I was kind of showing a graph of this to talk to advisors about why, Hey look, there's no way you're going to time this.
And literally, as I'm on stage doing this presentation, the advisors are in their seats getting the news that there's going to be a reprieve. That was crazy. Like you can't, what do you do around this? You communicate with your clients like crazy. You try to get them to stay disciplined.
Look, you also do want to make sure they're in the right kind of portfolio for volatile times. I mean, we're pretty clear from our perspective, be diversified. There's this sort of argument out there, Hey, look, in bad times, correlations all go to one. So how is diversification really helping me?
But that's a very narrow view, right? In that moment, sure, everything looks bad because systematic risk is such a big part of the overall risk. But zoom out a little, look at it from a standpoint of months, a year, a couple of years. That diversification matters. And you don't want to be concentrated in the worst place in volatile times.
So stay diversified, be at the right risk tolerance, and then stay the course.
[00:02:37] Doug Heikkinen: Have you ever seen something like this before?
[00:02:40] Dana D'Auria: Well, 2008, of course. I mean, 2008 was a rough period. In fact I actually referenced it too, because one of the things we talk about a lot here are customized solutions.
And one of the big ways you want to customize is tax, right? If you have somebody who's in like an SMA, for example. Are you taking advantage of a time like this? I mean, there was no worse conversation I've heard, I think, in my career than clients in '08 who not only had their portfolios dropped dramatically, but they had a tax bill.
So those, clients, right? It just so happened that what they were invested in, there were cap gains distributions that year and they just, it's unfathomable almost, right? How am I having this massive cap gain distribution when the portfolio lost all this money? But of course we know that's absolutely possible in a fund.
So, I think advisors, looking back on kind of the experience of the past, '08 is a good one. COVID is a good one, and kind of the lessons we took from that are applicable here.
[00:03:40] Doug Heikkinen: So why tariffs? Why are tariffs causing such volatility? Give me a little bit of education on what they are and why they're rocking the boat so much.
[00:03:51] Dana D'Auria: Yeah. I mean, at the end of the day it's a consumption task tax, right? Like at the end of the day, it's a tax put on this import and it requires the consumer, whether it's the buyer who's then going to pass it on to the end consumer, to kind of pay this tax and it has the specter of raising the cost.
So, we just got through obviously a period of pretty bad inflation, right? And it was kind of V-shaped, upside down V-shaped, right, maximal increase, and then it came down pretty fast too. But everybody's very wary about inflation. So in the midst of that, to then put a bunch of taxes on imports that we all rely on, you're raising the specter of another big price increase. So that's very concerning. We came into this year with this expectation of a big bull market. That this administration was going to be really pro-growth, pro-business. And also that they cared a lot about inflation.
And so I think everybody knew tariffs were coming, that was well signaled. But I think the breadth, the magnitude, that caught everybody off guard. And now you're saying, okay, now we gotta rewrite this whole picture we had, and this could seriously hurt growth. Right? And what that means, of course, is we could have a price increase at the same time we're wiping out a lot of the growth story. And then you're looking at potentially stagflation. You're looking at the Fed trying to figure out do I cut rates to battle the encroaching recession that would have unemployment? Or do I keep rates where they are because I gotta keep inflation at bay?
So it's just, it, it's obviously very difficult for markets. And I think the other, one of the other points I would make that about this, the volatility, the uncertainty, the sentiment factor is that, the precedent is that the executive branch can kind of set these tariffs at will.
And that's what makes this a little bit crazy and nerve wracking, right? In the morning, we could do one thing, and by the afternoon we could get more news and there's really no governor on it.
[00:05:51] Doug Heikkinen: So if the message for investors is always stay the course, why the market swings? Because people want to be traders?
[00:05:59] Dana D'Auria: Yeah. Yeah. I mean, look, the message is one thing, right? What people are doing is quite something else. I mean, not everybody has an advisor sort of providing some ballast in the relationship. The investing public and investments at large, a lot of people are paid a lot of money to try to figure out the right thing to do and the, and quote unquote "figure out the right thing to do," can be very much a trading mentality, not a investor mentality.
So very different messaging depending on what your engagement with capital markets really is. But for advisors, who are here at our conference, I mean, for the most part, the stay, the course message is the right message.
[00:06:35] Doug Heikkinen: And enter the Fed. So what's the Fed going to do?
[00:06:38] Dana D'Auria: Yeah, I know the, well, there's a difference in opinion about what the Fed thinks it's going to do and what the markets think the Fed's going to do.
I mean, the markets certainly think, the Fed put is back on the table. We're going to get more rate cuts. They're going to have to accelerate. There's even some concern that maybe they're already behind the curve, given the magnitude of what this could be. Now, notwithstanding, we've got this, sort of temporary reprieve.
But, I'm more in the camp honestly, that I think this fed has been slow to act. They've demonstrated that, and I think this one is going to be no different. Right? I think they're going to take their time and look and see, are these tariffs destroying demand or are they raising prices? Because if they're raising prices, we're not excited about cutting.
[00:07:22] Doug Heikkinen: Dana, you're very busy. It's been a great conference. I'm going to go let you answer more questions. Thanks so much for being with us.
[00:07:29] Dana D'Auria: Thank you.
[00:07:30] Doug Heikkinen: To learn more about in Envestnet, please visit in Envestnet.com. Please follow us on LinkedIn, X and Facebook, all @Advisorpedia. For everybody at Advisorpedia, our producer Tory Miller and the Power Your Advice podcast team, this is Doug Heikkinen.