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Is there a downside to going with a private financial advisor person (not sure what the term is) as opposed to working with someone in your bank? As far as I can see, there isn't, but you guys are more knowledgeable. I'm in Canada if that makes any difference.
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Aug 5, 2008 20:41
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SecretFire posted:How is your advisor getting paid? Some work off the trailing comissions and other comissions, making them (potentially) more like salesmen than advisors. Others take 1-2% per year, and some even do it for a fixed dollar amount per hour. My advisor gets paid off commissions, so when I put into funds etc. I think she gets part of the MER (out of the fund's company's pocket, not out of my share). I can see your point that she could be acting like a salesman, but on the other hand she does get part of the profit so she has interest in signing me up for successful funds. The bank (CIBC for me) has access only to CIBC funds, which might suck (they do, it turns out).
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Aug 5, 2008 23:15
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Thanks for the info. I ordered that book for my next batch of stuff from Amazon.
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Aug 8, 2008 18:34
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I am reading 4 Pillars and he says (or I guess, predicted in early 2000s) that future US stock market returns will be lower than historical because the US stock market is now proven and has less risk. How has this turned out? The whole 4% rule thing is kinda predicated on future returns (over very long term) being similar to historical. Other question - I am getting out of my actively managed high MER financial advisor hell hole and moving everything into index funds or ETFs. Considering this will be most or all of my portfolio, should I dollar cost average it in over 3-12 months "just in case"? Or just buy in to my new portfolio 100% all at once? Vehementi fucked around with this message at 10:29 on Jan 3, 2014 |
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Jan 3, 2014 07:05
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The correctness of the passive strategy relies on the assertion that it is impossible to perform research and choose good fund managers and/or funds. Since 50-90% fail, actively managed investing is doomed if research does not help - but I don't choose at random, so if research can help, then active funds may be viable. Can someone point me to the research that shows that I cannot research fund managers / funds to make good decisions?
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Jan 3, 2014 21:25
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flowinprose posted:I can't point you to that, but if you're going to put forth that much effort, why not just do research instead into the underlying stocks themselves and get an even greater return on investment for your time. That is a super active full time thing. That's doing the fund managers' job for them, really, and I am not a trained professional. Further, everyone here says you can't pick stocks effectively! Which is it, people?! Vehementi fucked around with this message at 21:37 on Jan 3, 2014 |
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Jan 3, 2014 21:34
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Yeah, I am still reading through 4 Pillars. I'm also reading this http://www4.gsb.columbia.edu/null?&exclusive=filemgr.download&file_id=522 Basically, any argument that says "Most people are dumb / can't pick stocks / whatever" holds no water, because I do not intend to invest in dumb people if I can help it. Whether I can help it is the question. quote:There's also the question as to how you logistically go about picking a fund manager. Right. Even in these last 5 posts by you guys, I am seeing conflicting messages. On one hand you say it's not possible to pick stocks. On the other you say it is possible but just hard and requires time and research (if that's true, then why aren't people employing time and research to beat the market?). There are no good mutual fund advisors, else the huge pensions would scoop them up. But, there are Steven Hawkingses, they're just hard to identify, and you could be one too! Well, if it's possible and just hard, talking about how the extra gains might not be worth my time (?) is pretty weak. I feel like something is being left out here. These arguments don't feel sound. e: I'm mostly convinced, I'm just in extreme devil's advocate mode here. Vehementi fucked around with this message at 22:21 on Jan 3, 2014 |
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Jan 3, 2014 22:13
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I think market efficiency is beside the point. The point is whether empirically some people can beat the market over time and whether it's possible to reliably identify those people. If the market were incredibly inefficient but everyone is a monkey, obviously funds would underperform regardless. There are many reasons you might or might not beat the market, and all we need to know is whether we can predict that (based on investment process, or stats, or whatever). Where da data at? "90% fail!" is not the da data. In that '80s Buffett article I linked below everything he influenced towards value investing beat the market over decades (not just 2 people, etc.) Is that a lead? e: I'm probably sounding obtuse now so I'm going to shut up and finish educating myself and revisit this later... Vehementi fucked around with this message at 22:44 on Jan 3, 2014 |
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Jan 3, 2014 22:35
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In 4 pillars the guy claims future stock gains will be lower because the US is supposedly a very stable market, and that bonds should be at least 20% of portfolios. Is this still believed?
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Jan 13, 2014 04:28
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ntan1 posted:It could be possible that future gains might be lower. He doesn't make the claim that this will be the case, but he says that you will need to prepare for such a scenario when dealing with estimates of your portfolio. No, he does make the claim, explicitly. He uses gordon's equation to spec it out & shows there'd be practically no value in holding more than 80% equity.
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Jan 13, 2014 06:04
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horse mans posted:There's got to be reputable firms though, right? If you do a bit of reading, you at best won't need any firm, and at worst won't choose a poo poo firm (or know what the warning signs are). Pick up 4 Pillars from the OP and read it cover to cover. You'll realize how simple it all is and kick yourself for not doing the obvious easy smart things sooner, while simultaneously despairing about what your future might have been otherwise :p This is one of those times where if you skip it you'll do it anyway in a few years and be mad you didn't sooner, so jfdi.
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Jan 15, 2014 05:26
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Just throwin' this out there... If your employer matches your RPP (or whatever the US equivalent is of defined contribution pension plan using pre-tax dollars) contribution but the poo poo fund you're forced to use underperforms by 2%, then looking at a 30+ year time horizon it would actually be better to not contribute, start with half the principal, and invest in something that doesn't suck. If the funds you have to use underperform by more than 2%, the time horizon is sooner. Of course, this assumes that you'd be staying with that company for the duration of the suck. If you quit your company you can move the RPP into your own choice of investments and enjoy the free double bucks. Vehementi fucked around with this message at 17:31 on Jan 17, 2014 |
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Jan 17, 2014 17:29
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Help, I need to talk to my sponsor. I'm currently in 25% bond ETF, 75% equity. That actually hit the 30% bonds threshold at which point I dutifully rebalanced like a good trooper. However everything is super on sale and I want to suddenly have second thoughts about my 25/75 allocation. It sure sounds to me like I should in fact have a 100% equity allocation right now! My confirmation bias is nodding super vigorously at quote:don't turn it into a religion that calls for you to ignore whats going on in the world Talk me off the ledge? Or maybe say that this is a once in a lifetime buying opportunity and I should slowly move my bonds into equities over the next weeks/months.
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Mar 19, 2020 06:17
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Paul MaudDib posted:Holding at least a small amount of bonds reduces your risk significantly while not really impacting gains all that much quote:And to be blunt, right now your bonds are saving you. The reason your bond allocation is creeping up is because your stocks are making GBS threads themselves. That’s exactly what the bonds are there to do. No of course, I get that. But now that a massive fall Happened I basically have a pile of cash I could invest while everything is On Sale. If it was literally cash (like I got a windfall) it would be difficult to just buy a shitload of bonds right now (which is the equivalent of not selling my bonds)... Timing the market terms Capitalized for effect
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Mar 19, 2020 08:12
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The following things are either all true or all false: - because oil is going to recover, that guy should hold his oil - oil recovery will outperform the market - anyone not holding oil should sell index funds and go into oil
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Mar 22, 2020 00:48
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Robo advisors fit in to a specific spot on the effort spectrum No loving effort, thought, learning: 2% advisor from the bank Some effort and understanding: 1% Tangerine fund thing and fund transfers A bit more understanding but I don't want to actually do trades: 0.5% robo advisor to press the rebalance button for me Full understanding: 0.1% buy ETFs directly If someone happens to land right there it makes sense to use them
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Jul 5, 2020 18:49
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