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  • Evaluate this for me if you have the time...

    This is from an advisor touting their value as an "institutional" investor versus "retail" financial planners. I could go into my thoughts but curious what you guys have to say here. To speak to my situation a bit I'm considering using an advisor after feeling stressed about the current market craziness and my handling of it. Anyway, welcome thoughts on this brochure. Could not make it a PDF so have to click on the link.

    https://online.flipbuilder.com/ucwi/...ile/index.html

  • #2
    Step 1 is see who you are dealing with. Have you checked Finra?

    https://brokercheck.finra.org/search/genericsearch/list

    https://brokercheck.finra.org/firm/s...ralInfoSection

    Short firm history (2018) and a number of disclosures from prior employers with settlements.
    One the website, it shows qualification of $1m.
    Very low for “institutional “ but it seem the background was from retail firms. Not sure a “handpicked portfolio” is what you need.
    Didn’t bother further. I would be concerned with evaluating the specific advisor you are thinking out working with.
    7 firms in about 20 years seems a lot. Just my opinion. My impression is one builds a “book” and changes for compelling reasons.
    If you want someone to manage it, I would suggest Vanguard or Fidelity. No idea how they get compensated. Just random thoughts.

    Comment


    • #3
      Their SEC ADV-2 is a good place to start (including fees in section 5). https://files.adviserinfo.sec.gov/IA...VRSN_ID=636128

      Comment


      • #4
        These are both helpful I didn’t know about these resources.

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        • #5
          “feeling stressed about the current market craziness and my handling of it.”
          This is not unusual.
          The last 10-11 years with a dip and an extremely fast continuation is the exception. If you made investment moves, the jury is still out. If you didn’t, the jury is still out. No one will protect your interests like yourself. Rational plan and stick with it. You got this if you deal with your own behavioral issues. Many people here seek “suggestions” on portfolios or financial planning issues. Kind of an anonymous second set of eyes.
          Now, not sure if you really had a question. Can’t beat the price and it’s completely impartial. Good luck.

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          • #6
            Thanks Tim. I think my main concern with the advisor I mentioned is that they seem to market themselves as having lower fees. But I know they don't work for free. I haven't made major moves in the market - did some buying on the dip but nothing major. Didn't panic sell. I'm on the younger / building end. Also you are right Tim one of the great things about here is you can't beat the price. That being said, can anyone speak to this?

            Does an institutional money manager have any pricing advantage on buying stocks? They seemed to sell me on the idea that buying VOO or VO or similar fund through a money manager or on my own has hidden fees of 1-2%. I've never thought of passive funds having any hidden fees. So my question is, if I buy vanguard funds or stocks am I buying at a higher price than an institutional investor (someone handling billions of dollars) can?

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            • #7
              Originally posted by somethingmorethanfree View Post
              Thanks Tim. I think my main concern with the advisor I mentioned is that they seem to market themselves as having lower fees. But I know they don't work for free. I haven't made major moves in the market - did some buying on the dip but nothing major. Didn't panic sell. I'm on the younger / building end. Also you are right Tim one of the great things about here is you can't beat the price. That being said, can anyone speak to this?

              Does an institutional money manager have any pricing advantage on buying stocks? They seemed to sell me on the idea that buying VOO or VO or similar fund through a money manager or on my own has hidden fees of 1-2%. I've never thought of passive funds having any hidden fees. So my question is, if I buy vanguard funds or stocks am I buying at a higher price than an institutional investor (someone handling billions of dollars) can?
              LOL at the glossy brochure talking about how they will save you money by not having hidden fees, and then not disclosing what their fees are
              It sounds like their scheme is to buy a bucket of individual stocks. Some people do such on their own of course.
              There are institutional versions of index funds with (slightly) lower expense ratios. Compare VITSX and VTSAX. But that is not what the brochure is talking about

              Comment


              • #8
                "Their SEC ADV-2 is a good place to start (including fees in section 5). https://files.adviserinfo.sec.gov/IA...VRSN_ID=636128"

                The advisor fees vary. Seems they charge on top for the services they provide. Seems they might hit one up for up to 1.6%. It says negotiable. With the competition for self managed funds (low account, transaction, and expense ratios) it is doubtful an FA would deliver a net expense less than you could do on your own. They deliver a service and will need to get paid. That comes out of your account. True? Focus on the service you want, not the cost of similar investments.

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                • #9
                  Originally posted by somethingmorethanfree View Post
                  This is from an advisor touting their value as an "institutional" investor versus "retail" financial planners. I could go into my thoughts but curious what you guys have to say here. To speak to my situation a bit I'm considering using an advisor after feeling stressed about the current market craziness and my handling of it. Anyway, welcome thoughts on this brochure. Could not make it a PDF so have to click on the link.

                  https://online.flipbuilder.com/ucwi/...ile/index.html
                  why dont you start here?
                  https://www.whitecoatinvestor.com/financial-advisors/

                  Comment


                  • #10
                    Originally posted by Peds View Post
                    I think I'm looking for someone local. I do think there is a lot to say for being able to meet in person from time to time.

                    Comment


                    • #11
                      Originally posted by somethingmorethanfree View Post

                      I think I'm looking for someone local. I do think there is a lot to say for being able to meet in person from time to time.
                      It’s hard to catch Covid 19 from a video conference.

                      Comment


                      • #12
                        There are great pointers on using the ADV documents that are public for your research & protection. In addition, there is fee "value" everywhere today: zero trading costs for most platforms on equity and ETF trades, zero fee mutual funds, free planning, an ever expanding ETF market and I ever heard a news line that there will be a "rewards" type bonus from Fidelity for staying in a mutual fund for "x years" the other day.

                        The problem is that firms are rushing to cut costs without necessarily adding value. Value comes from the add-ons of someone who truly acts as a CFO for you and your family. I can recall examples from mentors and personal experience where its the reviews/retention of tax documents each year, holding a digital copy important planning documents etc that deliver massive value to clients. Examples I've experienced are the ability to fax over durable POA and living will documents to a spouse at the hospital, catching attempts to alter estate documents and 'slip them in' by family or associated individuals and so on. Value comes from the output of the service not the fee paid alone.

                        Best of luck in your search!
                        Founder, Coastal Wealth Planners- Fiduciary Tax-Sensitive Retirement Planning & Wealth Management www.coastal-wp.com email: [email protected]

                        Comment


                        • #13
                          On the flip side, I've seen plenty of financial institutions and advisors require that powers of attorney and other legal documents that were perfectly valid under state and federal law be re-submitted on the bank or brokerage's preferred form. Failing to comply with valid POA designations absent a court order (or threat of litigation) and contesting the durability of a durable power of attorney when there was little to no question of validity.

                          It hardly seems like forwarding copies of existing records and documents to the next of kin should stand out as an exceptional "above and beyond" effort, but that's just how the financial services industry can be at times.

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                          • #14
                            Hank I don't disagree with you on any of those points but you also made the case how it is not the norm. The irony is that many institutions will gladly take a one page certification of trust without requiring any of the trust documents themselves but will rake you over the coals for POA etc. Although the examples given are very high level they are outside the "norm" that you will see. Personally, I insist that all of my clients have or be working on the 3 major estate documents (durable POA, Advanced directive & Last will), a long term care strategy (in writing), Investment policy statement & 2 years tax returns.

                            These are the minimum items that any financial professional should have on hand for their clients if fiduciary work is truly being done. They also all work hand-in-hand to providing exceptional advice and service. For example: the SECURE Act created some major tangles in many estate plans that involved tax considerations & trusts, by having the documents on hand appointments can be prioritized for any clients who have a direct impact just by going back and reviewing the estate documents & proactively calling out to them. Having a trailing 2 year tax file allows for identification of any opportunities (e.g. roth conversions of in-kind shares during the market pullback) while having a very detailed understanding of what room we have to work with before jumping a bracket etc. It's also allowed for myself and other colleagues to catch mistakes when something is changed in the filing year over year.. They each on their own may seem somewhat small but these are values above and beyond the price compression that is happening across the investment landscape. Value to some is low price (think Motel 6) while to others its service (think Ritz Carlton).
                            Founder, Coastal Wealth Planners- Fiduciary Tax-Sensitive Retirement Planning & Wealth Management www.coastal-wp.com email: [email protected]

                            Comment


                            • #15
                              I would not consider this firm. The marketing
                              ​​is so misleading as to be deceptive.
                              "Institutional". To put this in perspective, the minimum to get into a Vanguard institutional fund is $100,000,000. Here "institutional" is used as a meaningless marketing buzz word. "We are an institutional money management firm that caters to individual investors. We think using the word institutional helps us market to individuals"

                              There is no such thing as "no trading costs". This is the sort of thing a deceptive person might claim to entice someone who does not know any better. ALL trading has costs, commissions are only one such cost. Payment for order flow, market impact and spreads are trading costs. It is possible to avoid the order flow costs but most brokers that offersoffer zero commissions make money by selling the orders.
                              If someone has a way of eliminating market impact and spreads I would love to hear how they do it.

                              They make the absurd claim that one cannot gift mutual fund or etf shares.

                              They compare apparently real life returns to a mix of index funds to a backtested (as in, "this did not actually happen") return to their secret strategy.

                              They make the absurd claim that they are more cost efficient than mutual funds and etfs.

                              One could go on.
                              They offer nothing you need and will charge you for things you do not want.


                              Put your money in a handful of cap weighted, minimum cost mutual funds. 2-4 funds should be all you need. Check for rebalancing once or twice a year. That is all there is to it. Save your 1.6% fee.

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