An advisor agreed with me about buying DDD at $49.50 in 2014. I eventually got out at about $15 I think. Worst loss to date by a ton. They are susceptible to the same errors as anyone else, even the ones with all the right certifications and blah blah.
My advisor called me about diversifying my retirement and wanted to put some money in Fidelity's energy fund. This was in July of '14......
I would only suggest doing so if you know someone, or have a reference from someone reliable. I work with hundreds of advisors across the nation, half of them are certifiably retarded.
You're just describing a shitty advisor. Theres plenty of good ones that will help you not fuck yourself over.
Its just like any profession where the majority suck at their jobs. The majority of people suck and are idiots in general. Doesn't mean finding a good one is difficult though. 90% of the discussion in here is something I would never recommend to one of my clients.
Agree, but I do think the barriers to entry to become a FA need to be raised. Seems almost any clown can pass the 7 and 66, and said clowns are the ones that give the profession a bad name
I think everyone who participates in this thread regularly understands that most of the topics here are more speculation than true investing. Nobody needs a thread discussing index funds and tracking the market. This is the place for volatile stocks and speculative plays.
This is my sentiment. I had to have a sort of introductory call with one advisor a couple years ago that particularly stands out. He had made a good amount of money (no fucking clue how) from a peach farm he had for many years, and wanted to use that money to setup an advisory practice for himself and his buddy. I couldn't even progress the conversation toward talking financials because he couldn't even tell me his email address and didn't know how to open an excel file. Me: Do you use Microsoft Outlook for business communication? Him: I'm not sure, how do I figure that out? Me: Do you have a Microsoft Outlook icon on the desktop of your computer? Him: I'm looking on top of my desk and don't see anything like that.
There are a shit ton of bad advisors out there, some just really dumb, some unethical, but there are quite a few legitimately good ones as well.
Yea they raised the score to 75 for the 66 and it knocked quite a few people out. The CFP is a little tougher designation so thats a positive to look for. Yea I get it and everyone enjoys playing around with the market, I just figured I would throw it out there that the discussion is literally the same as sports gambling (which is also enjoyable.) When I see some comments about people doing stupid shit with their retirement money it makes me cringe.
So the discussion going on begs the question of Human advisor vs Robo advisor. Team Robo advisor. The only way I would personally use a human advisor is if they had a CFA.
If you have enough money you should absolutely get a good advisor. Their teams, most importantly, help with long term things like estate planning, taxes, and all the other shit we get ourselves into.
A CFP might work for some people and I an definitely see the market for it. But Im personally not comfortable with someone else handling my money unless they have a CFA. If it was a smaller amount of money I think a CFP would be a good start, but for larger amounts of money I want a CFA.
Estate planning - lawyer ... actually fairly easy to set up at a low cost. Hell, I did my will on legal zoom. Taxes - thats for an accountant. When I think of an investment advisor I think of a portfolio manager. I don't want a stock picker because I don't believe they can continuously beat the market by more than the fees they charge me. I believe most of the studies that tell you you are better off investing in index funds over the long run.
except advisors don't just buy and sell stocks - that's what stock brokers did in the 70s. Many fiduciaries are included in the estate planning role, and a financial advisor is included. Large private bankers and large FA teams will have someone that just focuses on that. And if you don't want to get f'ed by the IRS, you better hope your FA is reviewing your positions in December. You can't use losses once it makes it to your CPA.
We fix our clients up with the best possible mortgage and insurance products that we can as well. Once you combine all the value add and the ability to have someone monitor the market for you instead of making emotional decisions? Not to mention we have access to the best of the best money managers and their points come out of my fee? I'll stack my results in 20 years up against betterment.com with confidence I'll provide a better return and my client won't have had to spend a second messing with it and worrying about it in their free time.
Speaking out of turn, but the CFA tests are a step above in difficulty. That designation means you're dealing with an intelligent person that has the cognitive ability to grasp whats going on.
eh they may be harder than some of the other tests but I wouldn't take passing them as proof that someone is competent
I would also like to add a quality estate planning attorney is worth their weight in gold. Not for fucking wills . For the actual planning of an estate.
Not independent. Before I got on the min acct was in the 2-3 range. It just depended on the situation. They hadn't taken an acct under 2 in 9 years. I was hired to develop a new generation and service existing clients that require extra attention. If you have 50k to invest, my boss will let me take you on but you would have to fit a rapid growth profile or be inheriting some good money. If it were up to me I would just work with anyone that needs help. Im extremely new to the whole business and I want to grow with people new to investing. My boss's existing business is really interesting and provides me with plenty of work but those aren't my relationships and I will never count on them as a source of income.
Agree with the poster that said it provides some minimum level of competence in portfolio management (among many other subjects). When you start getting enough money you move from financial planning to portfolio management. TBH I don't know what all the CFP entails but I know that its not nearly as hard as the CFA and I doubt it goes into the depths of portfolio management as the CFA. Also if im going to pay someone to manage my money they need to know more than I do. Working in the industry I feel like I have a better understanding than most and could pass the CFP if I wanted while I cant say the same about the CFA. So my on the subject is for bigger accounts most people will want a CFA.
CFP is more of a legal, insurance, general investment background than CFA. Depends on what people are looking for in an advisor. CFA is more difficult, but having that level of advisor would be overkill for 99% of people.
We are completely fee based minus some older clients who wanted to stay commission based. We will charge someone based on the size of the account and the amount of hand holding they need. Is that what you were asking?
Anywhere from .8 to 1.2 Since every clients profile and needs are different, we charge them based on the amount of work we will be putting into their account. Also, for a high net worth client .08 is pretty standard. For an account below 200k 1.2 is pretty standard. For a typical account that requires the typical amount of work, 1 is about where we would be. We don't charge a one time fee on an initial financial plan, and we only reduce fees, we don't raise them. Usually when someone brings us more assets.
I deal with advisors everyday. Amazes me how so little some of them know. Others spout off knowledge of the industry from the 70s that has me all confused. Advisors are great salesman. They sell their office, team, firm, skills, etc to get you to hand over your money. It's then the back office that provides them with all the necessary knowledge and support to successfully place your account in the correct positions. So many advisors are continually pushed to get bigger clients and increase the overall client base that the little guys are dropped or forgotten about. Can't stay stagnant in this industry.
My biggest pitch on the actual investment side is the commitment the mothership has made to hiring elite investment teams and giving us access to elite research, money managers and funds. I would bet we actually take a meeting with one out of 20 wholesalers, and if they don't bring their manager with them we don't even listen. Our standards are as high as imaginable, and we are happy to take the basis points out of our fees to match each client to the manager that suits them best. We also almost never use in house products just to make sure our clients understand our commitment to finding the best manager out there (even though we have some excellent funds that in some cases perform better than anything else out there.) Compare that to a guy who manages his clients portfolios himself. Lets say he was a finance major at Texas, is plenty smart, and works hard. That guy is competing against me based on returns, but while he is agonizing over his options and where he thinks the market is headed, I'm letting a guy w/ a 8 year all star track record at Goldman with degrees from Harvard and Northwestern make those decisions and I simply monitor my clients allocation and the performance of that guy's fund. I'm going to lunch with my client to keep current and then drinks with his CPA and Estate Attorney to update them on new information when needed. It also allows me to stay unemotional and gives me time to talk clients off the ledge before they do something stupid in the middle of market conditions like we are seeing right now. I'm gonna take my model all day over the other guy's, and my poach rate so far has been really successful.
Anadarko just got a major haircut and cut their dividend by 81.5% to .05. Err body shoring up their cash.
But your all star guy with an 8 year track record is going to have to beat all the Harvard graduates at Vanguard by a full percentage point on average each year just to break even if the Texas graduate simply put his money in Vanguard funds. Seems like a tough challenge.