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Started By
Message
re: Roth IRA advice.
Posted on 4/19/16 at 12:07 pm to Tiger4life306
Posted on 4/19/16 at 12:07 pm to Tiger4life306
quote:easier said than done with actively managed funds. the examples are too numerous to count. Find me the advisor that consistently outperform indexes long term after fees. Where Nobel prize winning economists can't do it, some bum at EJ and RJ will have a tough time LINK
This is when companies like Vanguard and other low cost fund companies thrive. Actively Managed funds such as American Funds shine in the down years. For example, when cheap index funds are down -15% with the market a good actively managed fund will be down--call it -9%. So for someone starting out with not much built up those large dips might not matter much since you have time to recover your losses but for a high net worth client and a much shorter time horizon that % can make a significant difference. I just want to put it into perspective that actively managed funds aren't trying to mirror an index (for the most part). The bread and butter of their company is downside protection of client assets in the down years with moderate gains in the up years. This is why American Funds are seen used with companies like Ed Jones and Raymond James since their target market is clients that have already built up their nest egg and can't afford the large losses.
By far the safest and surest bet are index funds.
This post was edited on 4/19/16 at 12:26 pm
1
Posted on 4/19/16 at 12:12 pm to Books
quote:
I just want to put it into perspective that actively managed funds aren't trying to mirror an index (for the most part). The bread and butter of their company is downside protection of client assets in the down years with moderate gains in the up years.
I'm telling you right here that most advisors aren't trying to outperform an index. If they tell you they are then I can see why you would be disappointed...
Posted on 4/19/16 at 12:18 pm to Tiger4life306
quote:LINK
I'm telling you right here that most advisors aren't trying to outperform an index. If they tell you they are then I can see why you would be disappointed...
American Fund claiming just that
Posted on 4/19/16 at 1:05 pm to Books
And it has beat the index, so your argument is moot.
But ultimately Tiger is spot on with his argument.
But ultimately Tiger is spot on with his argument.
Posted on 4/19/16 at 1:14 pm to Shepherd88
quote:depends on the index
And it has beat the index, so your argument is moot.
Posted on 4/19/16 at 1:39 pm to Unit225
quote:
Any advice on what to expect this is my first time investing.
Getting the worst advice humanly possible. One of my employees brought her EJ portfolio to me. She couldn't understand how she was losing money. She has lost 15% of her portfolio since 2011 (when she started with EJ)when the market has been up almost 13%. Her adviser has her in about the shittiest mutual funds imaginable with expense ratios at or over 1%. Do yourself a favor and cancel your meeting.
I helped my employee open accounts with Vanguard and she is in the process of moving all of her assets over.
This post was edited on 4/19/16 at 1:43 pm
Posted on 4/19/16 at 2:18 pm to baldona
quote:
Yes actively managed hedge funds are meant for the super wealthy to not lose a lot of money, but they cost a shite ton and don't always work as planned, ala Bill Ackman in 2015 whom lost 20.5%:
Who's talking about hedge funds?
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