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Posted by Walter_Slipperman on December 30, 2008, 5:11 am
>> My financial planner has been using Schwab Institutional to hold my
>> accounts
>> and has been using a lot Dimension Fund Advisor mutual funds. Between my
>> wife and I we have eight different accounts and the fp has bought a lot
>> of
>> funds distributed among those accounts, with some redundancies.
>
> Can you clarify, did your "fp" do this without your consent, or with
> your consent and knowledge?
With my consent. We had a meeting a month ago where I told him that I was
considering changing financial planners. He warned me against changing from
his stay-the-course-and-well-balanced philosophy to somebody he derided as a
market timer but he said of course the choice is mine, it's my money. Last
week I told him that I had made the choice and wanted him to sell off all of
those DFA funds.
>
>> I've become displeased with his performance and responsiveness. Yes I
>> know
>> the extreme changes and drastic loses to portfolios that are effecting
>> many
>> of us but I am disappointed that he didn't see this coming, which is kind
>> of
>> understandable, but in addition to that he has not managed things well
>> from
>> a tax perspective this year and I am dropping him and moving everything
>> from
>> this guy to a friend's fp at Merril Lynch. I just like and trust the new
>> guy a whole lot more.
>>
>> The multitude of DFA funds had to be sold and I am looking at 19 sales
>> that
>> were just made, ranging from $29 up to $49.95 with lots of different
>> values
>> in between. The sales on those funds came to $719.46.
>>
>> I'm wondering if there was a better way to handle all of these sales?
>> and
>> why was there such a different range of prices for the sales? [I will
>> talk
>> to him and to Schwab to understand this but I thought I'd get some
>> opinions
>> here too.]
>
> I would like to ask you to elucidate why exactly you need someone to
> do your trading for you, as opposed to you selecting funds based on
> your own thinking.
>
Over the 37 years of my adult life I have been too cautious, and not very
systematic when I tried to do the investing myself. For example ever since
the US started running large deficits in the Reagan years I figured that it
was going to eventually lead to unavoidable hyper inflation and that bonds
would be a miserable investment. So I would never consider owning any
medium term government or commercial bonds. But using a fp they do that by
habit and that was what balanced my portfolio in the early years of this
decade and made the former fp look okay.
also in answer to your question why I don't do my own thinking, I have a lot
of other interests and professional demands that use my time, so one percent
of the value of the portfolio seems okay if a professional who is following
the financial world can do better than me.
Walter
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