Jim180 wrote:I think you may have a few things in your portfolio that are not in the benchmarks you mentioned. You may also be more heavily weighted in some areas than the benchmarks. Some of the holdings you mentioned were gold. Yes, I know it's only 4% but it does drag you down a little. You mention TIPS. The Vanguard Target 2010 Fund has a position in the Short-term TIPS fund. Do you have the longer term TIPS? The longer term ones have done worse. Those are just two things that jump out at me. You need to look at the exact breakdown of the benchmarks and compare it to what you have.
cwradio wrote:I have been with my adviser since December 2012. My portfolio is 40% equities (US, international, Global Real Estate and emerging market index funds) 56% fixed income( US, TIPS, and international) and the rest (4%)in commodity and gold mutual fund/ ETF (total of 14 Vanguard, ETFs and DFA funds).
I get a statement each month and it tells me how well I have done compared to 40/60 Balanced Strategy.
My portfolio is always below the benchmark fund. Compared to VSCGX Vanguard Life Strategy Conservative growth 1.71% YTD and VTENX Vanguard Target Retirement 2010 Fund 1.66% YTD, my portfolio is 0.67% YTD.
I have discussed the performance of my portfolio but my adviser said "stay the course"
My question: What do I do? Stay with my current adviser and stay the course or do something else? Thanks
Jim180 wrote:I did some math and can say now with certainty that it is your gold ETF that caused your underperformance. Gold has been down about -25% YTD.
25% of your 4% holding= 1% So your gold ETF has taken about 1% off your portfolio. The numbers you gave show that you are underperforming by guess what? 1%! So if you want to match those two Vanguard funds you would have to sell your gold ETF.
Beat The Street wrote:Being an advisor is a very tough job, but not for the reasons many would think. It is not too hard to gauge someone's risk tolerance and come up with an appropriate allocation of index funds, but it is EXTREMELY difficult to get people to stay the course. Most do not understand how markets work and think that since they are paying you a fee their account should never decline in value. I had a lady call and complain once because her account was down $5 (no joke). Most of the customers I come across agree we should try and sell high and buy low by rebalancing but then they beg me to do the exact opposite .
Would people do better by avoiding an advisor fee? No way, unless you are a boglehead. Most people have never heard of Mr. Bogle unfortunately.
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