Fisher Investments CEO Recommends Passive Investing [emoji16]

[RetiredAt49]

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Originally Posted by FREE866 Interesting..... He doesn't claim that his firm passively invests....so you lagged the S and P....what did they say the benchmark you should compare your portfolio to? and what % stock were you? curious

The benchmark they use is the MSCI world index. They were/are adamant that everyone be in 100% equities regardless of their age/situation. I was fine with that AA because I’m only 50 and I agree with the math/research

[target2019]

Here is a view of FI from across the pond: Fisher Investments Review https://www.yodelar.com/insights/fis...stments-review

In another review there is a section called "How Fisher Investments invests your money" https://www.magnifymoney.com/investi...r-investments/

Between the lines of the mumbo jumbo, you can see there isn't a conventional benchmark. Maybe that has changed, maybe not.

[FREE866]

Quote:

Originally Posted by RetiredAt49 The benchmark they use is the MSCI world index. They were/are adamant that everyone be in 100% equities regardless of their age/situation. I was fine with that AA because I’m only 50 and I agree with the math/research

And how did the portfolio do compared to MSCI?

[audreyh1]

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Originally Posted by ERD50 I think the solution is education - if people really understood the advantage of passive investing, and what those ups/downs really mean (buying opportunities in the accumulation phase), they'd be much, much more likely to do it correctly. They could always join this forum for free, and get hundreds of people in a virtual support group to hold their hands in a downturn. -ERD50

Education - it still won’t work for a lot of people. Humans are not 100% rational beings. It takes a lot to balance against fear/greed FOMO and outright panic. Not to mention a family member freaking out.

We see it here all the time. And this is a fairly educated forum.

I personally picked an overall minimal hands-on strategy to shield myself from short-term emotional reactions. And it took a lot of self-motivated education and life experience and soul-searching to get there. I’m not convinced most people can do this. The tinker instinct is super strong even when things seem to be going well.

[FREE866]

Quote:

Originally Posted by audreyh1 Education - it still won’t work for a lot of people. Humans are not 100% rational beings. It takes a lot to balance against fear/greed FOMO and outright panic. Not to mention a family member freaking out. We see it here all the time. And this is a fairly educated forum. I personally picked an overall minimal hands-on strategy to shield myself from short-term emotional reactions. And it took a lot of self-motivated education and life experience and soul-searching to get there. I’m not convinced most people can do this. The tinker instinct is super strong even when things seem to be going well.

Totally.....and I think now, in terms of investing, with the 24/7 news , social media frenetic environment it is even harder to put on blinders, have a plan and stick with it.

[audreyh1]

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Originally Posted by FREE866 Totally.....and I think now, in terms of investing, with the 24/7 news , social media frenetic environment it is even harder to put on blinders, have a plan and stick with it.

There are so many strong instinctive biases. Recency bias is a huge one. Then all or nothing thinking seems to be very common - along with the inability to weigh short term versus long term trade-offs. The short-term issues/fears tend to way overshadow the long-term likely outcomes.

Yes media noise magnifies all of this.

[RetiredAt49]

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Originally Posted by FREE866 And how did the portfolio do compared to MSCI?

Some years they did better, other years they did worse. Not sure exactly how it compared over 20+ years but I’ll have to dig up that document again.

[FREE866]

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Originally Posted by RetiredAt49 Some years they did better, other years they did worse. Not sure exactly how it compared over 20+ years but I’ll have to dig up that document again.

I get that, and please don't take my inquisitiveness the wrong way, but you said you were with Fisher for two years and they trailed the S and P. I'm wondering how they did in those two years vs their declared benchmark-the MSCI

[RetiredAt49]

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Originally Posted by FREE866 I get that, and please don't take my inquisitiveness the wrong way, but you said you were with Fisher for two years and they trailed the S and P. I'm wondering how they did in those two years vs their declared benchmark-the MSCI

They lagged behind their MSCI benchmark by 2-4% during my two years there… I was unimpressed. I’m kinda shocked when Ken recommends that passive investing because they do not preach that nor do passive investing themselves

[Koolau]

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Originally Posted by audreyh1 I just know Fisher must have a massive advertising/marketing budget.

He gets a lot of free advertising by appearing on the financial porn shows quite often. Hey, a guy's gotta make a buck somehow.

[audreyh1]

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Originally Posted by Koolau He gets a lot of free advertising by appearing on the financial porn shows quite often. Hey, a guy's gotta make a buck somehow.

I still see lots of internet advertising and that costs.

[audreyh1]

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Originally Posted by Koolau He gets a lot of free advertising by appearing on the financial porn shows quite often. Hey, a guy's gotta make a buck somehow.

I still see lots of internet advertising and that costs.

Plus mailers, etc.

[FREE866]

I read their MarketMinder site. It's pretty informative and they usually have a counter consensus take on things which I really like.





https://www.fisherinvestments.com/en...berOfResults=5

[matjung]

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Originally Posted by RetiredAt49 Ken Fisher, founder of one of the largest wealth management companies, just released a YouTube video where he recommends passive investing - specifically investing in low cost index funds… I just about passed out because as a former client, Fisher Investments had me invested in over 80+ individual stocks, which I spent all of last year unwinding and re-investing in VOO and VTI. They are self proclaimed “experts” in active investing yet their CEO is now saying active investing is a bad idea and that everyone should pursue passive investing Here’s the video: https://youtu.be/vJ3iDYNZCvk

Maybe the company under performed the last few years.
When the Last active investor starts to suggest Go passive, it might be time to return to the world of active investors.

[matjung]

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Originally Posted by audreyh1 Education - it still won’t work for a lot of people. Humans are not 100% rational beings. It takes a lot to balance against fear/greed FOMO and outright panic. Not to mention a family member freaking out. We see it here all the time. And this is a fairly educated forum. I personally picked an overall minimal hands-on strategy to shield myself from short-term emotional reactions. And it took a lot of self-motivated education and life experience and soul-searching to get there. I’m not convinced most people can do this. The tinker instinct is super strong even when things seem to be going well.

Some above average high income earners learned with a single stock investment like Tesla you can earn more money in one month then a passive fund in one year. It does not work every month. It worked often.
Tesla only, worked very well in January this year. Valuation is for Stupids, this is the mindset of some, on the paper, highly educated people.
I don't believe in education. We have too many of them, and not enough who learned how to repair a house after a tornado. Or do we lack those architects who learned building weather proof houses.

[athena53]

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Originally Posted by RetiredAt49 As a former client of Fisher Investments and OP, they charge 1.25% (assets under management model). They had me in 80-90 individual stocks. They do not “passively” invest as they were always swapping assets around.

That would be a dealbreaker for me. I probably still have too many moving parts in my portfolio but I monitor the IRR on each using a spreadsheet that can be updated in 5 minutes with downloads of current values. I've moved more into ETFs but have some individual stock picks that are doing well (e.g. ULTA, COST). I think Jim Cramer makes a very good point about ETFs getting dragged down when a few of the component companies look bad but there can be some good individual company picks. (Yeah, I know, I take him with a grain of salt and do extra research- his interviews with CEOs border on the obsequious.)

So... is Fisher going to start moving all its clients into ETFs? If they do, how will the justify their fees?

[FREE866]

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Originally Posted by athena53 That would be a dealbreaker for me. I probably still have too many moving parts in my portfolio but I monitor the IRR on each using a spreadsheet that can be updated in 5 minutes with downloads of current values. I've moved more into ETFs but have some individual stock picks that are doing well (e.g. ULTA, COST). I think Jim Cramer makes a very good point about ETFs getting dragged down when a few of the component companies look bad but there can be some good individual company picks. (Yeah, I know, I take him with a grain of salt and do extra research- his interviews with CEOs border on the obsequious.) So... is Fisher going to start moving all its clients into ETFs? If they do, how will the justify their fees?

He is not doing that and people really need to watch the video.....hes not "telling everyone to go passive" which has been falsely repeated in this thread.

[Montecfo]

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Originally Posted by audreyh1 Education - it still won’t work for a lot of people. Humans are not 100% rational beings. It takes a lot to balance against fear/greed FOMO and outright panic. Not to mention a family member freaking out. We see it here all the time. And this is a fairly educated forum. I personally picked an overall minimal hands-on strategy to shield myself from short-term emotional reactions. And it took a lot of self-motivated education and life experience and soul-searching to get there. I’m not convinced most people can do this. The tinker instinct is super strong even when things seem to be going well.

Market researcher Dalbar has measured the returns of "average investors" for a couple of decades plus, based on mutual fund flows. Long story short, average investors in both equity and bond funds earn about half the market return due to poor attempts at market timing, fear, greed, etc.

So it is very easy to blow away average investor results. Simply... Wait for it... Stay Fully Invested.

[Montecfo]

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Originally Posted by audreyh1 There are so many strong instinctive biases. Recency bias is a huge one. Then all or nothing thinking seems to be very common - along with the inability to weigh short term versus long term trade-offs. The short-term issues/fears tend to way overshadow the long-term likely outcomes. Yes media noise magnifies all of this.

Very good points. Humans in some ways are just poorly wired for investing. Folks here who have saved enough to retire on their investments are either statistical outliers, are very disciplined, saved enough to outrun human factors, or some combination.

[richardf]

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Originally Posted by Hank The only expertise this guy has is marketing and promotiing his firm. He's been plastering web ads and video content all ofver the web for years.

How did Fisher do for 2022? Did Fisher still charge a fee for accounts that lost money in 2022? I’m investing in CDs only, but I’m 80 years old.