The 5 Pitfalls of Mutual Funds by,....

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SeeMoe
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The 5 Pitfalls of Mutual Funds by,....

Post by SeeMoe »

......Ken Fisher. Mr. Fisher says ,in his TV Ad, that using mutual funds initially is a good way to begin accumulating wealth, but once the investments approach, say, $500,000 it is time to get serious about investing. In his booklet he lists " The 5 Pitfalls of Mutual Funds...." Anyone read this article?

SeeMoe :?:
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Re: The 5 Pitfalls of Mutual Funds by,....

Post by saltycaper »

Yes. Typical solution in search of a problem marketing piece, in my opinion. Some concerns raised should not be ignored (fund overlap, fees, tax considerations), but they largely can be addressed without avoiding mutual funds.
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Re: The 5 Pitfalls of Mutual Funds by,....

Post by SeeMoe »

saltycaper wrote:Yes. Typical solution in search of a problem marketing piece, in my opinion. Some concerns raised should not be ignored (fund overlap, fees, tax considerations), but they largely can be addressed without avoiding mutual funds.
"Typical solution in search of a problem." Great line! Thanks, and I agree regards fund overlapping, fund fees , taxes and other pitfalls such as personal biases and panic selling in fast developing bear markets, Etc. that the savvy ,do it yourself, investor needs to be aware of,...and manage.

SeeMoe.. :beer
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Re: The 5 Pitfalls of Mutual Funds by,....

Post by munemaker »

saltycaper wrote:Yes. Typical solution in search of a problem marketing piece, in my opinion. Some concerns raised should not be ignored (fund overlap, fees, tax considerations), but they largely can be addressed without avoiding mutual funds.
He, like all other providers in the investment business, are trying to figure out how to compete with Vanguard.
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Re: The 5 Pitfalls of Mutual Funds by,....

Post by dbr »

Not to mention "Get serious about investing . . ." to be followed by "You have the money to get in on the real deals. Let's talk."
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There are almost always better options than mutual funds.

Post by F150HD »

[Thread merged into here, see below. --admin LadyGeek]

Saw a commercial on Fox Business the other day its actually on this page.

https://www.fishertvreport.com/

There are almost always better options than mutual funds.
If you have more than $500k in investable assets, it may be time to graduate to a new approach.

_
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Re: There are almost always better options than mutual funds.

Post by Top99% »

I didn't click the link to "learn more" because I am pretty sure an email would be required and I would get endless spam as a result. I am sure there are better options than mutual funds for people in the financial services industry to sell us "customers". :mrgreen:
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Re: There are almost always better options than mutual funds.

Post by jimb_fromATL »

F150HD wrote:Saw a commercial on Fox Business the other day its actually on this page.

https://www.fishertvreport.com/

There are almost always better options than mutual funds.
If you have more than $500k in investable assets, it may be time to graduate to a new approach.

_
Not going to waste my limited bandwidth watching it, but I can tell you what they are not saying:

"... what we mean is a new approach which will let us rake off some of the profit for us, whether it makes any more money for you or not. The $500K limit is really to make it more profitable for our time. It's not because it's some magic number that makes it better for you to invest in something other than mutual funds, and it makes you more inclined to think you're a special case and be less skeptical ..."

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Re: There are almost always better options than mutual funds.

Post by flamesabers »

My impression is Ken Fisher's focus isn't on inexpensive equity index funds. On the site he states his guide will teach you about the hidden, heavy costs of mutual funds and improper diversification. None of this applies for funds offered by brokers like Vanguard, Fidelity, etc. I suspect Mr. Fisher is out to make some money by going after the worst of mutual funds.
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Re: There are almost always better options than mutual funds.

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At least when I gave them a thorough look 8 years ago, Fisher Investments (a Registered Investment Advisory firm, an RIA) used a "Separately Managed Account" approach. I know of a few local RIAs that also use Separately Managed Accounts.

In essence the portfolio investment committee at these RIAs act like "mini active mutual fund" managers, picking and choosing stocks and bonds that they think will create a better portfolio. Knowing that they can't have as much research backing as big mutual funds, I always found it hard to believe that they held out any promise of outperformance. They should not be expected to outperform the better mutual funds (other than by luck :oops: ), and the better mutual funds have great trouble outperforming low-cost index funds (other than by luck :oops: :oops: ).
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Re: There are almost always better options than mutual funds.

Post by iamlucky13 »

How much you want to bet that a couple of the 5 pitfalls are:

* Some mutual funds have high expense ratios and hidden fees. Therefore all mutual funds are bad.

* Mutual funds are a one-size-fits-all approach that aren't tailored to your individual needs and goals.

Oh look. The free guide is here:
http://www.fi.com/pdf/fisher_investment ... _funds.pdf

The above are pitfalls #3 and #2 respectively

The one I got the best kick out of was #1 - diversification gone wrong: If you hold overlapping funds, you can be less diversified than if you have non-overlapping investments. For example, Fidelity large cap value has 32% duplication with large cap growth.
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Re: There are almost always better options than mutual funds.

Post by mhalley »

I would die and go to hell before I sold an annuity (or a financial product that didn't make me money)!
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Re: There are almost always better options than mutual funds.

Post by saltycaper »

Recent related thread:

The 5 Pitfalls of Mutual Funds....
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Re: The 5 Pitfalls of Mutual Funds by,....

Post by LadyGeek »

^^^ I merged F150HD's thread into here, which is a similar discussion. The combined thread is in the Investing - Theory, News & General forum (general discussion).

As a reminder, opposing points of view are welcome. Please state your comments in a civil and factual manner.
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Re: The 5 Pitfalls of Mutual Funds by,....

Post by White Coat Investor »

Don't know why people are feeling defensive (didn't read the article or watch the video) but there are certainly issues with mutual funds. It just happens that the upsides usually outweigh the downsides. But here are some of the downsides:

Additional expenses (expense ratio kind of stuff)
Lots of bad mutual funds (actively managed, high cost, loaded etc)
You can pay capital gains taxes even if you personally took a capital loss!
You get penalized for the bad behavior of other fund holders
Harvested losses don't get passed on to the fund holders
Most mutual funds don't have an ETF share class to flush out capital gains (Vanguard the notable exception)
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Re: The 5 Pitfalls of Mutual Funds by,....

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SeeMoe wrote:......Ken Fisher. Mr. Fisher says ,in his TV Ad, that using mutual funds initially is a good way to begin accumulating wealth, but once the investments approach, say, $500,000 it is time to get serious about investing. In his booklet he lists " The 5 Pitfalls of Mutual Funds...." Anyone read this article?

SeeMoe :?:
I don't know, I was serious about investing with my first dollar. Pretty much I realized that there was no pot of gold at the end of the rainbow. If it was to be, it was up to me.

Ken Fisher is a skilled marketer. I get his stuff in my mailbox from time to time and I just shred it. Mr. Fisher has a column in Forbes Magazine and I think he is well regarded on Wall Street. I think the TV ad is just marketing hype.

Found the article online. Here are the five pitfalls: 1) Diversification gone wrong, 2) Lack of Personalization, 3) Hidden Fees, Heavy Costs, 4) Lack of Communication, and 5) The Tax Disadvantage.

Pretty much Fisher promises personal attention and personalization. There is something to that, but much of that is ego. If I had $500,000 invested at Vanguard, I doubt that the CEO of Vanguard or even the portfolio manager would return my calls. You get access to an Investment Counselor but that person probably doesn't manage the actual portfolio.

Fisher also seems to like building portfolios of individual stocks. In my New 'Doo thread, I talk about my performance as a stock picker. I look pretty good with 5, 3, and 1 year performance but I trail the US Total Market Index and the S&P 500 over 10 and 15 years. I suppose the Fisher managers could do a better job than me but on the other hand, I have outperformed some managers. I did a reasonable job with the stocks but my returns were really nothing special. I will keep monitoring performance through Quicken. At some point, I may fire myself. I have a hard time believing that Fisher will do better than the indexes. Most professional managers can't beat the indexes.

Below is the link:

http://www.fi.com/pdf/mutualfundoffer.pdf
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Re: There are almost always better options than mutual funds.

Post by F150HD »

jimb_fromATL wrote:Not going to waste my limited bandwidth watching it, but I can tell you what they are not saying:
Well, I did watch it...in the end despite what the pdf said, for some reason I found myself wondering about all his 'hand gestures' in the video.

Does that guy really talk like that? or was that scripted? its was so noticeable!
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Re: The 5 Pitfalls of Mutual Funds by,....

Post by TheTimeLord »

White Coat Investor wrote:Don't know why people are feeling defensive (didn't read the article or watch the video) but there are certainly issues with mutual funds. It just happens that the upsides usually outweigh the downsides. But here are some of the downsides:

Additional expenses (expense ratio kind of stuff)
Lots of bad mutual funds (actively managed, high cost, loaded etc)
You can pay capital gains taxes even if you personally took a capital loss!
You get penalized for the bad behavior of other fund holders
Harvested losses don't get passed on to the fund holders
Most mutual funds don't have an ETF share class to flush out capital gains (Vanguard the notable exception)

This is my favorite. People seem to be blissfully unaware or possibly ignorant that if there is a stock in the index with huge capital gains and they own the index when it gets taken out they just lost a big game of musical chairs in their taxable account.
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Re: The 5 Pitfalls of Mutual Funds by,....

Post by jimb_fromATL »

Interesting Forbes Article about Ken Fisher's track record.

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Re: The 5 Pitfalls of Mutual Funds by,....

Post by friar1610 »

Just last week I received an impressive looking envelope from Fisher Investments in the mail. If I had $500K or more in investable assets, I was urged to respond - no obligation, you see - to begin to determine if we were right for each other. Fortunately, this arrived the same day that we put out our recycling and the mail arrived before the recycling had been picked up. So, all by myself, I determined we were not right for each other and made another contribution to the recycling bin.
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Re: The 5 Pitfalls of Mutual Funds by,....

Post by nedsaid »

friar1610 wrote:Just last week I received an impressive looking envelope from Fisher Investments in the mail. If I had $500K or more in investable assets, I was urged to respond - no obligation, you see - to begin to determine if we were right for each other. Fortunately, this arrived the same day that we put out our recycling and the mail arrived before the recycling had been picked up. So, all by myself, I determined we were not right for each other and made another contribution to the recycling bin.
Yes, I have made the same walk to the recycle bin with my Fisher Investments envelope.
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Re: The 5 Pitfalls of Mutual Funds by,....

Post by KlingKlang »

SeeMoe wrote:......Ken Fisher. Mr. Fisher says ,in his TV Ad, that using mutual funds initially is a good way to begin accumulating wealth, but once the investments approach, say, $500,000 it is time to get serious about investing.
Isn't this the same psychological approach that casinos use in having 'high roller' rooms? You're a serious gamesman and don't want to be rubbing elbows with those $5 table gamblers. Let them stand outside and drool watching you getting great service from much better looking cocktail waitresses.
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Re: The 5 Pitfalls of Mutual Funds by,....

Post by nova1968 »

Fisher is like an octopus, his hands are everywhere. Not really sure how effective he is but I believe his advisory fees generate a lot of revenue for advertising. He's all over the internet, FB etc. Click on an interesting post on FB and its likely he will pop up.
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