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re: Thoughts on financial advisors stock picking?
Posted on 2/17/26 at 4:48 pm to TigahsOnTop
Posted on 2/17/26 at 4:48 pm to TigahsOnTop
quote:
Curious how long you have until retirement. There is vast research showing that dividend paying companies underperform the market
That is one of the reasons I’m keeping all my market index funds in my 401K account. If I were in my 20’s, I wouldn’t consider the 30 fund / bonds approach they offer, but at 60, I need a portion of my portfolio to be conservative and to be able to cover most of my living expenses with the hope of leaving the funds in my 401K to ride the market untouched.
Something to add, when reviewing credentials of financial advisors for the other companies I was considering, I was amazed how many of the advisors had no educational background in finances. One person’s credentials stated his degree was in literature with an emphasis in Islamic studies. Liberal arts backgrounds were more prevalent than I expected. Getting a financial advisor certification must be pretty easy.
1
Posted on 2/17/26 at 5:17 pm to TigahsOnTop
quote:
This would imply that with enough time an advisor could beat the market..
Having enough vs having the most:
My view of the world is compounding increases cash at increasing rate, while time consumption (aging) decreases life at increasing rate. Objective was to control time before those two curves intersect.
Know many people who trade large amount of time (n) seeking that extra return (k).
While n delivered my objective. It got me enough to do what I want, when I want, with whom I want, for as long as I want and plenty of controlled time ahead (God willing).
Enough is magical. Sorry, advisors.
Index underpinned this.
Ironically, we now use advisor managed fixed income (heeded steer from someone on this board, and research validated that advice!).
This post was edited on 2/17/26 at 5:32 pm
Posted on 2/17/26 at 5:32 pm to Ramblin Wreck
quote:That makes a great deal of sense, and I’d say this is a perfect example of actual value-added financial planning. Congrats on finding a good group!
I wouldn’t consider the 30 fund / bonds approach they offer, but at 60, I need a portion of my portfolio to be conservative and to be able to cover most of my living expenses with the hope of leaving the funds in my 401K to ride the market untouched.
Posted on 2/17/26 at 5:39 pm to Everyday Is Saturday
quote:
Know many people who trade large amount of time (n) seeking that extra return (k).
I completely agree with the sentiment. My math brain is just hating the way you are characterizing this haha.
Your formula implies that the extra return compounded at n would be enormous, while also suggesting that (k) is actually achievable if you spend enough time.
That would imply that a FA who spends all of their time chasing (k) would actually be extremely valuable. My whole point is that most people can NOT achieve any level of (k), no matter how much time they spend!
So we both reach the same conclusion, spend less time trying to create alpha and more time with your family, etc. and just index.
This post was edited on 2/17/26 at 5:40 pm
Posted on 2/17/26 at 5:58 pm to TigahsOnTop
quote:
That would imply that a FA who spends all of their time chasing (k) would actually be extremely valuable.
Just keep eye on FA value for FA cost (vs value for low cost of indexing equities). I’m a Boglehead (John Bogle, Vanguard) at the core. Semi related, you may enjoy reading his book (Enough). Sounds like it would be great timing.
Good luck!
Posted on 2/17/26 at 10:36 pm to TigahsOnTop
quote:Not always about outperforming the market. Depends on age and risk tolerance based on what point in life a person may be.
Curious how long you have until retirement. There is vast research showing that dividend paying companies underperform the market, so I don’t love that strategy. Otherwise, it sounds like the firm is solid and definitely a good representation of a value-added financial advisor (tax-planning, etc.).
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