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Did it - dropped my advisor
Old 02-22-2007, 08:48 PM   #1
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Did it - dropped my advisor

It may not seem like a big deal, but for the few of you who knew how financially naive I was when I first made the scene here, you'll appreciate that I officially dropped my AllianceBernstein money manager this week. My initial weaningplan was to leave about $200k under his management for large value stocks while I took back the rest. It was odd:

Me: Brian, I think I've decided to take a more active role in managing my retirement money.
Brian: You wanna pick stocks.
Me: Well, no actually, I want to create a diversified group of investments in indexed mutual funds at Vanguard.
Brian: I know that our growth portfolio lost 2% in the last 6 months but that's because we are positioning for growth stocks to really take off this year.
Me: Lost 2%? I hadn't realized that - the web reports don't sort it out in that way... Anyhow, I'd like to leave about $200k with you in value stocks, and I'll roll over the rest.
Brian: We require a $400K minimum balance.
Me: Really? Sorry to hear that. Guess I'll have to roll over the whole thing.
Brian: That's fine, but at least don't make a decision until I send you some reports. We're confident that growth funds will make a big comeback this year.
Me: Thanks, Brian. I'll think it over. Bye.


Paperwork is done, funds just waiting to be fed. In all fairness, they did well by me - beat most of the indexes, but not after their 1.6% management fee (that wasn't clearly laid out on their web site, either).

It felt like a big step but strangely enough, I have absolutely no worries over this decision.
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Re: Did it - dropped my advisor
Old 02-22-2007, 08:55 PM   #2
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Re: Did it - dropped my advisor

Rich,
Let me be the first to say you made the right decision.
Pick your mutual funds - average into them and put it all on autoglide - enjoy
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Re: Did it - dropped my advisor
Old 02-22-2007, 08:59 PM   #3
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Re: Did it - dropped my advisor

Rich, good for you!

I did the same thing last year and never looked back. It's a great feeling when it's all over and everything is at Vanguard. You can actually see what's going on with your money any time you want to. With my so called advisers everything was a mystery and now I feel so liberated.
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Re: Did it - dropped my advisor
Old 02-22-2007, 09:05 PM   #4
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Re: Did it - dropped my advisor

Heh, afterall, you could put a portion of your wad into Vanguard growth funds and/or indexes.

"Not to get off on a rant here... "

I've been lapping up growthy VTSMX (Vanguard Total Stock Market Index) since it's been out of favor for the past five or so years.

Costs a whopping 0.19% ER. $3k min. for retirement accounts, no where near a $400k min.

1.6% ER at $400k is $6,400/year. 0.19% is $760. Go buy yourself a steak/crab/lobster/etc dinner and still be thousands ahead every year.

-CC
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Re: Did it - dropped my advisor
Old 02-22-2007, 09:08 PM   #5
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Re: Did it - dropped my advisor

Quote:
Originally Posted by Rich_in_Tampa
I officially dropped my AllianceBernstein money manager this week.
Advisor gona be alright?
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Re: Did it - dropped my advisor
Old 02-22-2007, 09:11 PM   #6
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Re: Did it - dropped my advisor

Quote:
Originally Posted by CCdaCE
I've been lapping up growthy VTSMX (Vanguard Total Stock Market Index) since it's been out of favor for the past five or so years.
Why do you say that VTSMX is "out of favor?"
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Re: Did it - dropped my advisor
Old 02-22-2007, 09:35 PM   #7
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Re: Did it - dropped my advisor

It wasnt doing too well 4-5 years ago, but I dont think its been out of favor.
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Re: Did it - dropped my advisor
Old 02-22-2007, 09:39 PM   #8
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Re: Did it - dropped my advisor

Quote:
Did it - dropped my advisor
Did he bounce? or splat?
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Re: Did it - dropped my advisor
Old 02-22-2007, 09:40 PM   #9
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Re: Did it - dropped my advisor

Quote:
Originally Posted by youbet
Why do you say that VTSMX is "out of favor?"
Maybe I should've said large cap growth. Specifically SP 500 Growth.

Or so says Callan

But, to me, the difference is minimal between VFINX (Vanguard's SP 500) and VTSMX (Vanguard Total Stock Market).

Am I wrong in saying it's "out of favor"? I'm asking. Maybe it's "returning to the mean".

-CC
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Re: Did it - dropped my advisor
Old 02-22-2007, 09:41 PM   #10
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Re: Did it - dropped my advisor

Hey Rich
Congrats! every 6 months you should remind me and I will generate some random pretty graphs & numbers for you. I think that is all that you are going to miss - when you are buying us all steak?

-h
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Re: Did it - dropped my advisor
Old 02-22-2007, 09:43 PM   #11
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Re: Did it - dropped my advisor

Quote:
Originally Posted by sgeeeee
Did he bounce? or splat?
He experienced a dead cat bounce, which was influenced by upward pressure on the dow while investors sought to flee rising inflation and shelter their assets from further erosion due to extensive collection of long term debt by foreign nations. In other financial news that we'll repeat three months from now to explain the exact opposite situation...

Congrats Rich, you're a free man!!
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Re: Did it - dropped my advisor
Old 02-22-2007, 10:08 PM   #12
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Re: Did it - dropped my advisor

Quote:
Originally Posted by Rich_in_Tampa
Brian: I know that our growth portfolio lost 2% in the last 6 months but that's because we are positioning for growth stocks to really take off this year.
My God! How could anything have lost 2% in the last 6 months? We've had a tremendous rally in all equity classes!

Audrey
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Re: Did it - dropped my advisor
Old 02-22-2007, 10:21 PM   #13
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Re: Did it - dropped my advisor

Quote:
Originally Posted by audreyh1
My God! How could anything have lost 2% in the last 6 months? We've had a tremendous rally in all equity classes!

Audrey
Let me assure you it took a lot of work!
-h
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Re: Did it - dropped my advisor
Old 02-22-2007, 10:44 PM   #14
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Re: Did it - dropped my advisor

Congratulations. You are now ahead of the game by at least 1.6% a year.
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Re: Did it - dropped my advisor
Old 02-23-2007, 12:28 AM   #15
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Re: Did it - dropped my advisor

"Your portfolio lost money but we think it's about to gain money. We'll let you know."
and
"I'm sorry, you don't have enough money to stay here."

Geez, Rich, if this is his customer-service technique then I wonder how he sold you his portfolio planning in the first place. Were they trying to get rid of you?!?

Quote:
Originally Posted by audreyh1
My God! How could anything have lost 2% in the last 6 months? We've had a tremendous rally in all equity classes!
Quote:
Originally Posted by bssc
Congratulations. You are now ahead of the game by at least 1.6% a year.
Hmmm... I'm not a CFP but I think I can see where 80% of that -2% came from.

Hey, lookie there, he's right-- your portfolio just gained 1.6% (annualized) in a few minutes. Those large-cap growth stocks really must be taking off!!
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Re: Did it - dropped my advisor
Old 02-23-2007, 06:37 AM   #16
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Re: Did it - dropped my advisor

Quote:
"Your portfolio lost money but we think it's about to gain money. We'll let you know."
and
"I'm sorry, you don't have enough money to stay here."

Geez, Rich, if this is his customer-service technique then I wonder how he sold you his portfolio planning in the first place.


Rich.. congratulations!!!!

I wish I could get my mom away from her 'broker' (was with Advest, not sure if he has moved.. in which case he would take her account with him). She mostly has T-bills and muni bonds.. but has also given him a pot to play with in the "managed-account" style. If I were physically nearby I'd try to get her set up with Vanguard and/or Treasury Direct (prob. not TD as she is not a computer person) since I could hold her hand through it all. Right now, he's the hand-holder, and she likes him because he seems like a "nice guy" and comes to her house and drinks coffee with her once a year.
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Re: Did it - dropped my advisor
Old 02-23-2007, 06:43 AM   #17
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Re: Did it - dropped my advisor

Quote:
Originally Posted by audreyh1
My God! How could anything have lost 2% in the last 6 months? We've had a tremendous rally in all equity classes!
Funny thing is, the portfolio overall did 15%! They rode a good/lucky selection of value equities for at least 18-24 months, and it did well enough to absorb the stagnant growth stocks.

Too much volatility for me, though it came out OK in the end.
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Re: Did it - dropped my advisor
Old 02-23-2007, 06:45 AM   #18
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Re: Did it - dropped my advisor

LET THE HEALING BEGIN !!

Congrats!
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Re: Did it - dropped my advisor
Old 02-23-2007, 07:02 AM   #19
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Re: Did it - dropped my advisor

Quote:
Originally Posted by Rich_in_Tampa
...I officially dropped my AllianceBernstein money manager this week.
"Physician, heal thyself"

Done!

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Re: Did it - dropped my advisor
Old 02-23-2007, 08:47 AM   #20
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Re: Did it - dropped my advisor

Quote:
Originally Posted by CCdaCE
Maybe I should've said large cap growth. Specifically SP 500 Growth.

Or so says Callan

But, to me, the difference is minimal between VFINX (Vanguard's SP 500) and VTSMX (Vanguard Total Stock Market).

Am I wrong in saying it's "out of favor"? I'm asking. Maybe it's "returning to the mean".

-CC
I guess I'm just not accustomed to your terminology.

I don't categorize the Wilshire 5000 (VTSMX) or SP 500 (VFINX) as "growth" focused. I usually refer to them as large cap blend.

Also, I think you are using the term "out of favor" to mean not performing well in relation to other equity classes. I usually associate "out of favor" with popularity. Some "popular" investment classes have rewarded their advocates with poor performance.........then they become "out of favor."

When you said that VTSMX was "out of favor," I thought you were saying that the Vanguard brand of Wilshire 5000 index fund had become unpopular or "out of favor" with investors for some reason. Maybe because the ETF Wilshire 5000 offering seemed more attractive. Or because the Fidelity brand of Wilshire 5000 fund had a lower ER......or whatever.



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