Thoughts on Scott Burns....

[innova]

Absolutely.

There are a number of DFA planners who are calling for DFA to do this though. It would allow DFA to offer its passive funds to a larger market without incurring the lack of control and turnover.

This would actually make it much easier for planners to do their clients right.

[Art G]

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Originally Posted by pedorrero I think I'll just order 5 or 6 more gold eagles from the coin dealer after my latest check clears... -- Pedorrero, whose menagerie consists of a gerbil, three cats, Eagles, Maple Leaves, and perhaps a Colt to ward off unwelcome visitors.

Historically, gold has been one of the worst investments you could ever make.

[innova]

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Historically, gold has been one of the worst investments you could ever make.

Sage advice from a market-timer

From some of your other posts here, I'd think that you would have strong feelings about holding gold when your crystal ball told you to!

That is good advice though (about not holding gold).

[FinanceDude]

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Originally Posted by innova I REALLY wish DFA would offer ETF versions of their funds ala Vanguard. That would truly be the best of both worlds.

That's not their business model. Offering it to the FA as a value-added option is the model. Creating a cheaper version of that through an ETF model with lower expenses would reduce the margins for DFA and the firms that offer them. Anybody think that's going to happen??

Right now I can offer clients the Vanguard ETF's through my discount brokerage platform and buy ETF's for my clients through Vanguard for a flat discount fee per trade. I can also use them in our managed accounts where clients pay an annual fee. To this point, other ETF companies are offering better customer service support than Vanguard is, and there's a LONG discussion of that in recent past on this very board.

I do not expect anyone on this board to understand why my ETF business is not with Vanguard at this point in time, but that is another thread for another day.........

[Art G]

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Originally Posted by innova Sage advice from a market-timer From some of your other posts here, I'd think that you would have strong feelings about holding gold when your crystal ball told you to! That is good advice though (about not holding gold).

Hey, there's a place for gold ( a very small place). OPGSX has been huge for me lately. However, to hear someone come on here now and say they plan to go buy more gold coins, when gold is near an all time high (which goes back quite some years), makes me feel there is need to offer caution.
Just to clarify my stance, I am a long term buy quality person with most of my portfolio, but I have no problem taking a portion and buying based on technicals with some stocks or options.

[FinanceDude]

Quote:

Originally Posted by innova Absolutely. There are a number of DFA planners who are calling for DFA to do this though. It would allow DFA to offer its passive funds to a larger market without incurring the lack of control and turnover.

It also would dilute DFA's competivie advantage as having a niche product that noone has access to unless you get certified with DFA.

Anyone of you who worked in a competitive industry where your company or you marketed a product that was unique and different can see the huge potential of having that edge. Why dilute the process to the masses? Maybe in DFA's mind, the "average investor" doesn't deserve it............

[innova]

You're right - its probably wishful thinking.

Quote:

Right now I can offer clients the Vanguard ETF's through my discount brokerage platform and buy ETF's for my clients through Vanguard for a flat discount fee per trade. I can also use them in our managed accounts where clients pay an annual fee. To this point, other ETF companies are offering better customer service support than Vanguard is, and there's a LONG discussion of that in recent past on this very board.

Funny - it seems I'm often disagreeing with you, but in this case I agree. Not a fan of Vanguard's brokerage, and I think there are much more compelling ETF options out there than what VG offers. For example - I wish VG would use different indices for some of their funds / etfs that would better target small or value companies (DFA excels here).

I haven't used their cust. support so I can't comment on that.

[FinanceDude]

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Originally Posted by innova This would actually make it much easier for planners to do their clients right.

Just to clarify, you appear to be saying that DFA should do this so they can give everyone and their brother access to the funds. Quite honestly, they don't want or need to replicate the Vanguard business model.........

[FinanceDude]

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Originally Posted by innova Funny - it seems I'm often disagreeing with you, but in this case I agree. Not a fan of Vanguard's brokerage, and I think there are much more compelling ETF options out there than what VG offers. For example - I wish VG would use different indices for some of their funds / etfs that would better target small or value companies (DFA excels here).

They reason we often disagree is that I am in the industry, and am more directly affected by what's going on. My clients have asked about DFA, and if there's enough interest that builds, either my partner or I will do the DFA certification and have the ability to put millions of dollars in it.

There is a LOT of unseen due diligence that goes along with it, along with a Compliance piece that would bore all of you to tears in how the broker-dealer is monitored by DFA to make sure protocols are followed........they are quite anal.........

What is "right" for the client is a subjective opinion that is NOT always a reflection of price. If it were, there would not be nearly a TRILLION dollars in hedge funds, an investment which I find has a somewhat dubious internal expense structure.........

[haha]

Quote:

Originally Posted by FinanceDude Anyone of you who worked in a competitive industry where your company or you marketed a product that was unique and different can see the huge potential of having that edge. Why dilute the process to the masses? Maybe in DFA's mind, the "average investor" doesn't deserve it............

Any salesman, or sales exec for that matter has wet dreams over the mere hint that they might get hold of a product with a unique and easily demonstrated sell points. Like, WOW, what happened?? This product is actually better, and it's all mine!!

Ha

[Ed_The_Gypsy]

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Huh? Look at their fee schedule AssetBuilder Inc. - Registered Investment Advisor- AssetBuilder Fees Quote for AssetBuilder :"We are currently only accepting accounts with at least $50,000." Have you even read his site?

Actually, yes. I have to go back and check to see what I did read. My wife yells at me for skimming. Guess she is right. There is $2MM in there somewhere.

[FinanceDude]

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Originally Posted by haha Any salesman, or sales exec for that matter has wet dreams over the mere hint that they might get hold of a product with a unique and easily demonstrated sell points. Like, WOW, what happened?? This product is actually better, and it's all mine!!Ha

I understand your point, but I have a different perspective than you do on this. DFA has a unique product, but they are controlling HOW you get to offer their products to your clients. In other words, they don't NEED to offer this to every investor out there. Saluki9 can provide some guidance here, but my understanding is that DFA first distributed through wealth management channels before it got offered to other advisors. The money flows have been strong, so they don't need to homogenize it and give it to a market already bloated by too many ETFs.......

[FinanceDude]

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Originally Posted by Ed_The_Gypsy Actually, yes. I have to go back and check to see what I did read. My wife yells at me for skimming. Guess she is right. There is $2MM in there somewhere.

Seems pretty straighforward:

I'll use a $250,000 example because a lot of folks on here have at least that much they could invest if they were convinced:

ER cost: 28-48 bp,depending on the portfolios used. I'll use an average of 38bp.

Fee cost: 43 bp on $250,000.

A trade cost of $20-$50 PER fund bought to get started,I will use an average of $30 a trade, because I know I and most other firms can do that.

So, your $250,000 costs $330 to buy the funds, the ER is $950 a year, and the ongoing management fee (wrap fee) is $1075. You paid $2355 to get "started", and ongoing of 81bp forever ($2025) a year.........

And a lot of you are excited about it, even though you have your money in VG at ER ratios of under 30bp?? You guys make me smile............

[haha]

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Originally Posted by FinanceDude I understand your point, but I have a different perspective than you do on this. DFA has a unique product, but they are controlling HOW you get to offer their products to your clients. In other words, they don't NEED to offer this to every investor out there. Saluki9 can provide some guidance here, but my understanding is that DFA first distributed through wealth management channels before it got offered to other advisors. The money flows have been strong, so they don't need to homogenize it and give it to a market already bloated by too many ETFs.......

I am in complete agreement with what you said. I was maybe clumsily trying to say the same thing I think. One way to create a uniquqe product with highly incentivized salespeople is to carefully control distribution, so that if a rep gets a presentation he and not someone down the block is going to get the sale if a sale is made by anyone at all. It all helps to keep price competition at bay.

Ha

[FinanceDude]

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Originally Posted by haha I am in complete agreement with what you said. Ha

You just scared the hell out of me with that comment...........

But then, I am just an FA on a DIY Internet forum with thousands of anonymous folks giving my opinions...........

[haha]

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Originally Posted by FinanceDude You just scared the hell out of me with that comment...........

Oh-Oh, you must be an Old Phart too.

Ha

[FinanceDude]

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Originally Posted by haha Oh-Oh, you must be an Old Phart too. Ha

Fear not, I may pay the $3000 or whatever, do the due diligence, get DFA certified, undercut Scott Burn's fees at his company, and interested parties can then contact me...........

[unclemick]

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Originally Posted by haha Oh-Oh, you must be an Old Phart too. Ha

Soooo - this month when I turn 65 - I should become 'born again' threaten to write a book about age 49-65 in ER and become a turncoat and say people should actually read books and proclaim ER is more complex than:

Pssst - Wellesley or or OR if you want modern - Target Retirement.

Successful investing is faith - as long as there is an economy and people are working:

'God Looks After Drunkards, Fools and The United States of America.' even if I do mis quote.

No matter what Angus Madison says!

heh heh heh - 1966-2006 after making it extremely complex - I figured it out - it's so stone simple - it just pisses me off when I think about it.



P.S. Still like Scott - especially his old series on the motorcycle and his articles on 'creative' lifestyles(aka cheap).

[windsurf]

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Originally Posted by Art G want2...you are right. However, everything you read, be it internet, newspaper, or in book, was written by someone. You are accepting someones' opinion as being correct. I am a firm believer in read everything, ask lots of questions, then go with your gut, but again, investing is so much guesswork and hypotheticals based on past performance, and yet that's the major disclaimer. In regard to investing styles, it is totally dependent on the individual. Are you a gambler, or one who feels safer with money under the mattress? One product does definitely NOT fit all, and yet Scott Burns makes a living of stating how simple investing is for everyone. I can't help but crack up laughing when he does his reviews and he'll state, "well, the couch potato portfolio earned X, but if you had just added in Y fund or Z fund, it would have earned this!" Well, then he himself is recommending NOT doing his own couch potato fund. And now he's suggesting hiring someone to move around your portfolio, well what's couch potato about that

Hey, you're probably pretty young. Go fer it. Bet the friggin farm. Dismiss the chrome dome geezer who has lived through a couple of the ups and downs that defined your great grandparents experience. You know what's best. Guide us. p.s. Abide Uncle Mick. The MF admits being through some wringers. Very educational: if ya care.

[Notmuchlonger]

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Originally Posted by FinanceDude Fear not, I may pay the $3000 or whatever, do the due diligence, get DFA certified, undercut Scott Burn's fees at his company, and interested parties can then contact me...........

Hey want to discuss some annuities?