"Think Your DIY Retirement Plan Can Beat an Adviser?" article - Page 2 - 2CoolFishing
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Old 02-12-2020, 01:14 PM   #11
bowmansdad
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I admire those that manage their own retirement, I’m not one of those. I’ve been with my broker for 20+ years and have no regrets. I interviewed 5 or 6 advisers before I settled on mine, I gave them all a scenario that I wanted to see what they would invest in, moves they would make in a changing market and their commission fees/ year. I received some interesting scenarios along with some outrageous fee plans. My broker won me over when he said his job was not to lose my money and manage my account at a low cost to me. It has been a highly successful partnership with him doing the worrying and me getting a check on the 1st of the month while my fund keeps growing. Just my experience.
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Old 02-12-2020, 05:20 PM   #12
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CMAN - no sales pitch from me, just trying to give different perspectives from the article

Its good to hear how well you have done in the market, and saved more from doing it yourself ... well done sir!

I am a big believer in smart beta factor based ETF - I use one that cost me 6 bps (0.06%)
I hate giving money away to fund managers that don't out perform the index
At the same time one should learn whats in the index and what they are buying.

For example the S&P 500 index (SPY is the etf ticker)
solid performance in 19' ... but most are surprised that you are really investing to the top 10% of the names in that index - those top 50 names make up 50% of that index

which is why I choose to use "FACTORS" or smart beta etf's to help with cost and outperform

This is easy when your in the business.... but If I was a mechanic, i would rebuild my motor when it wore out and save money ... instead I go to a mechanic to get the work done right - so I'm not broke down on the side of the road

Smart guys in all industries but more in those industry I would not trust to change my oil
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Old 02-13-2020, 12:19 PM   #13
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Originally Posted by Muddskipper View Post
CMAN - no sales pitch from me, just trying to give different perspectives from the article

Its good to hear how well you have done in the market, and saved more from doing it yourself ... well done sir!

I am a big believer in smart beta factor based ETF - I use one that cost me 6 bps (0.06%)
I hate giving money away to fund managers that don't out perform the index
At the same time one should learn whats in the index and what they are buying.

For example the S&P 500 index (SPY is the etf ticker)
solid performance in 19' ... but most are surprised that you are really investing to the top 10% of the names in that index - those top 50 names make up 50% of that index

which is why I choose to use "FACTORS" or smart beta etf's to help with cost and outperform

This is easy when your in the business.... but If I was a mechanic, i would rebuild my motor when it wore out and save money ... instead I go to a mechanic to get the work done right - so I'm not broke down on the side of the road

Smart guys in all industries but more in those industry I would not trust to change my oil
Your smart beta fund at .06% costs $60 a year on a $100,000 investment.The one I use is the SPY 500 index. It is .0945 or $95 per year. Vanguard's 500 index is lower at .04 (40.00 per year.). I don't want to pay someone $1,000 a year to save me $35.

As I understand it Beta refers to the price volatility of a stock.The plain 500 index funds have a beta of 1. A beta of more than one is more volatile , less than 1 is less volatile. Are you aiming for more volatility or less? I believe that it is generally recognized that less volatile stocks go down less in a down market but go up less in an up market. More volatile stocks go up more when the market is up but also go down more when the market is down. A beta of 1 seems like the sweet spot to me unless you know the direction the market is headed (which nobody does) Do you switch from a high beta fund to lower (or vice versa) based on your market analyis?

Whatever the composition of the 500 index its performance over many years in both up and down markets) has been good enough to satisfy me.
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Old 02-13-2020, 01:05 PM   #14
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https://www.investopedia.com/terms/s/smart-beta.asp
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Old 02-13-2020, 07:24 PM   #15
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I've managed my own investments for my entire life and was able to retire early with a nice nest egg. However, I spent a lot of time studying and learning along the way and still do. As my portfolio grew, my experience and skills grew along with it.

As pointed out above, a management fee plus mutual fund fees (which most advisors use) are a huge drag over time on the order of up to 2% typically. Compound that, and it's real money. I invest in individual dividend growth value stocks and, if anything, am over diversified, but I prefer that to minimize risk. The nice thing about individual stocks is there is zero friction vs mutual funds.

I also invest in the best stock picking newsletter in the business that has consistently beat the S&P 500 for ~50 years with less risk. So, beating the market plus no fees has worked for me. And if I screw up, there's no one to blame but myself. I prefer that to worrying about an advisor doing their job.
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Old 02-14-2020, 09:16 AM   #16
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So its a mutual fund that keeps its costs low by having its portfolio picked a by a computer? Interesting. Is there info as to how these compare to the indexes over time?
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