Some advice needed on a big loss

Bronte said:
You do realise that investments can go up as well as down whether is is shares/property/equities/minerals and this has nothing whatsoever to do with a broker.
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Why do you pay a broker ?? , if he advises, would it not be a logical assumption you should make Money.

Back to Original point, 45% loss in one year, invested in a falling property market.

Stop parroting "investments can go up , as well as down", his advice made OP buy, and this is fairly normal occurence, for some reason people trust them.
 
LDFerguson said:
Brokers have a moral obligation to advise their customers on the most suitable investment for them, from the range available.
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is this a LEGAL obligation?

can a broker be held accountable for advice that turns out in the short-term to be very poor?
or can they simpley use same excuse as "professional" fund managers
-> "well the market is down 20% overall, your fund is just down 15%", etc

Its a grey area, theres no perfect advice because nobody can tell the
future and everyone's situation is unique,
but, at the end of the day the broker makes their money by SELLING
YOU SOMETHING!

and alot of the time, its a SPIN-INFECTED, GLOSSY BROUCHURE,
FANCY NAMED "investment fund"
-> note bigger the boom we are in the more hyped the marketing

A financial advisor / investment broker needs to prey on your GREED emotions, while supressing your FEAR!

you dont drive your banger into a garage and expect the salesman to
say "your car is fine, you dont need to buy a new one"

summer 2007 the best advice would have been to sell everything
and goto cash, ok this is hindsight
but I'd bet youd have not ONE single broker / FA / investment fund anywhere that would even have entertained this idea at the time

cause they'd have no job

I'm not saying society doesnt need brokers/FA, we do
I'm saying we need a system were they can be ranked and reviewed
by customers, like hotels, cars, etc (and similar system for estate agents)

but we also need ALOT more input and effort, from financial regulator,
to educate public overall, and not just during downturns.

JR.
 
Crum Dub - I've already said that if, as looks likely from the subsequent post, this product was mis-sold to this individual, that's wrong and she should seek redress. I'm not trying to defend that.

But this idea that a broker should have some form of crystal ball that will allow them to do what some of the best financial brains in the world cannot - time the markets - is absurd. By your logic, anyone in the world who invested money in equities in any form over the last twelve months has been pooorly advised by their broker, as their money has declined in notional value in the short-term. Did the brokers of the world not see the current turmoil coming and advise their clients to switch to cash in Summer 2007?
 
crumdub12 said:
Why do you pay a broker ?? , if he advises, would it not be a logical assumption you should make Money.

Back to Original point, 45% loss in one year, invested in a falling property market.

Stop parroting "investments can go up , as well as down", his advice made OP buy, and this is fairly normal occurence, for some reason people trust them.
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I disagree with you when you say 'should make Money' you are incorrect it's 'may make Money' and also when you say 'his advice made OP buy' rather than 'OP decided to buy.' All investment advertising I've heard on Irish radio says investments can go up as well as down - there must be a reason this is attached to these ads, but obviously the message is not getting through and it's needs to be parroted some more.
 
LDFerguson said:
But this idea that a broker should have some form of crystal ball that will allow them to do what some of the best financial brains in the world cannot - time the markets - is absurd. By your logic, anyone in the world who invested money in equities in any form over the last twelve months has been pooorly advised by their broker, as their money has declined in notional value in the short-term. Did the brokers of the world not see the current turmoil coming and advise their clients to switch to cash in Summer 2007?
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Property investment is 2007 Ireland, not world equity markets
 
Bronte said:
I disagree with you when you say 'should make Money' you are incorrect it's 'may make Money' and also when you say 'his advice made OP buy' rather than 'OP decided to buy.' All investment advertising I've heard on Irish radio says investments can go up as well as down - there must be a reason this is attached to these ads, but obviously the message is not getting through and it's needs to be parroted some more.
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If all pros / cons are outlined, fine.

"May make Money" , Is that Paddy Powers you are thinking about.
 
crumdub12 said:
Property investment is 2007 Ireland, not world equity markets
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I see. So brokers should be able to accurately time certain markets but not others? Would you have a list of which markets I, as a broker, should be able to time? Irish Property - Yes, World Equities - No etc.
 
LDFerguson said:
I see. So brokers should be able to accurately time certain markets but not others? Would you have a list of which markets I, as a broker, should be able to time? Irish Property - Yes, World Equities - No etc.
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No need for a list, just know the products you sell and pros/cons involved, good brokers make money, bad brokers lose money.

BTW, I am not taking any shots at you.
 
LDFerguson said:
I see. So brokers should be able to accurately time certain markets but not others? Would you have a list of which markets I, as a broker, should be able to time? Irish Property - Yes, World Equities - No etc.
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A broker should have some grasp of economics and investment
fundamentals, ie business cycles, and BOOMS and BUSTS.

Nobody can time any market -> unless they are very lucky,
but a broker should be aware that, based on historical evidence,
its less probable a market will continue to rise at certain times,
and more probable a market will continue to drop at others, etc

in presenting products to customers the broker should be honest and open about these probabilities, even if it means it costing them sales /
commissions

like any salesman, being honest and open will probably get them more
business and loyal customers in future.

JR.
 
Zoe
You should check your policy again
If the capital was guaranteed, then it's possible that this will only apply if you leave it for the full term.
Most likely what you are seeing now is the surrender value ( what the policy is worth if you were to pull out now) . I think these type of policies would have a heavy penalty if it are encashed early. So you balance that you see would already have the penalty removed

Have you phoned your broker and talked to him since you received the statement?
 
JR Rizzo said:
based on historical evidence,
its less probable a market will continue to rise at certain times,
and more probable a market will continue to drop at others, etc
JR.
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Assuming we are talking about efficient markets, this implies that stock prices are serially correlated and do not follow a random walk. Evidence please!
 
Blinder said:
Zoe
You should check your policy again
If the capital was guaranteed, then it's possible that this will only apply if you leave it for the full term.
Most likely what you are seeing now is the surrender value ( what the policy is worth if you were to pull out now) . I think these type of policies would have a heavy penalty if it are encashed early. So you balance that you see would already have the penalty removed

Have you phoned your broker and talked to him since you received the statement?
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The Corinthian fund contains no guarantees.
 
In January 2007 I went to a broker and asked advise on investing 20,000 that I had because my husband died the year before. This was the entire of my worth and I wanted to invest the money for my son. He advised me to invest in an eagle star investment bond matrix (for 5 years, 5 star global fund 25% and 5 star europe fund 75%) This was my first ever investment and I am a novice. He told me it was medium risk and that he had seen investments like this generate upto a 50,000 return in recent years. Have I been taken for a ride? The value is around 11,000 today if I take my remaining money out. Should I cut my losses or wait to see if I can gain anything back??
 
Do you still have the "reasons why" letter from the broker (i.e. the letter detailing why he recommended this particular fund)?

If it says that this is a medium risk fund, I'd be inclined to go back to him and point out that as this is a high-risk choice of funds and thus unsuitable for an inexperienced investor to put all her investments into, you feel you were mis-sold and want your original sum back. If he doesn't agree, contact the Financial Services Ombudsman.
 
proudford said:
Have I been taken for a ride?
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You have received sound advice and you should follow it. Your son’s functional currency is the euro (i.e. it is the currency in which he will make future financial decisions) so putting 75% of the investment into euro equities makes sense. However, euroland doesn’t have a monopoly of future progress, so putting 25% into global equities will ensure your son picks up any upside occurring outside of Euroland, without exposing him to excessive currency risk. I can’t comment on the individual Eagle Star products as I’ve no experience of them, but the 75: 25 euro:global split to me is a good split, especially if your son won’t cash it for some time yet.


proudford said:
The value is around 11,000 today if I take my remaining money out. Should I cut my losses or wait to see if I can gain anything back??
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They’re no longer your losses: they’re your son’s. If you pull out now your son, and not you, looses 9 grand and also looses any upside potential from future increases in euro and global stockmarkets. Why would inflict this loss on your son?
 
Thanks for the advise but I am worried that there will be nothing left if I dont pull out his money before its too late, that wouldnt be doing him any favours.
 
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