Why pay for advice?

[Jim2007]

If the markets are efficient why don't we just buy trackers which charge 0.1% to 0.25% and not bother with a financial advisor at all?

I can invest in the UK, Europe, US, Asia Pacific, Japan and track the market for less than 0.25%. Rebalance every couple of years.

Where does the advisor add value to justify an addition to these low charges?

Assuming that you are disciplined and have a good understanding of asset allocation, I doubt you'd benefit from paying regular fees to a FA. At the same time you may still find value in having a FA review your portfolio from time to time, as they might offer insights that you have missed out on...

I'd also suggest that the fact that you are on this board makes you different to most investors - your interested in the topic, most are not, they are happy to have someone else deal with that stuff, even if they could do it themselves.

Jim

 

[pbyrne]

Fixed cost asset allocation review

Hi Marc,

Assuming that you are disciplined and have a good understanding of asset allocation, I doubt you'd benefit from paying regular fees to a FA. At the same time you may still find value in having a FA review your portfolio from time to time, as they might offer insights that you have missed out on...

I am wondering whether you offer a service similar to what Jim2007 outlines or whether you know of any providers that do.

I am looking to get a review done on a pension scheme and I am probably moving down the self-directed road. My plan at the moment is to buy a portfolio similar to [broken link removed].

I understand that there are many permutations of asset allocations - I am looking for something simple and low cost (I am a wannabe BogleHead)

I'd like an advisor to confirm I am on the right or wrong track and possibly do some backtesting for me to confirm my thinking.

pbyrne.

 

[Marc]

Hi

Lots of interesting questions raised in your post.

We don't really offer an ad hoc service where people can run ideas past us and then self direct their pensions.

The reason for this is simple - it doesn't really work.

The link you provide is a classic example of this. The article mentions dimensional funds which are not available directly to retail investors working without an adviser.

So the DIY investor trying to self direct their pension misses out on access to investment funds which are some of the very best in the world.

Vanguard is another example of a good fund range which is outside of the reach of the DIY investor.

These are classic examples of the real value that an adviser can add to the retirement planning process.

If you are interested in working with an adviser who can give you an asset allocation model like the merriman example but from a European perspective please feel free to send me a private message with your contact details and if we can't help I can put you in touch with several advisers who can provide this kind of service.

All the best

 

[Jim2007]

Hi Marc,

The link you provide is a classic example of this. The article mentions dimensional funds which are not available directly to retail investors working without an adviser.

So the DIY investor trying to self direct their pension misses out on access to investment funds which are some of the very best in the world.

I'm sorry I really don't accept this! Seriously for a fee you are going to provide access to some "secret funds" that out perform the market! What happened to all that efficient market theory you come out with........

Vanguard is another example of a good fund range which is outside of the reach of the DIY investor.

Vanguard funds are not suitable for European investors period - I think we both know that!!!

If you are interested in working with an adviser who can give you an asset allocation model like the merriman example but from a European perspective please feel free to send me a private message with your contact details and if we can't help I can put you in touch with several advisers who can provide this kind of service.

I expect that the OP is well capable of coming up with suitable European models and that was certainly not the kind of thing I was suggesting he pay for!

Jim.

 

[Marc]

Jim

You are entitled to your opinions but Vanguard manages 1.4 trillion US dollars and DFA 208 billion US dollars.

The markets clearly disagree with you.

Both companies have a European UCITS range domiciled in Dublin.

Please check your facts before posting on askaboutmoney again.
http://www.askaboutmoney.com/showthread.php?t=151983