Financial Markets Meltdown

[Dean2]

I know I have said this more than once, but if you are using a Financial Advisor, please at least check and see what he has you invested in, what you are paying in MERs, is the advisor levying other fees also, and what your annual rates of return are.

How much was in your account 10 years ago, 5 years ago, and how much is it today. How much are you contributing annually? What is your actual growth rate once your contributions are removed/deducted from today’s total? DO NOT fall for the “you have to stick it out long term” to see the gains. “We are still seeing the effects of Covid”, and the 200 other excuses they have ready to whip out when a client gets testy with them. If your portfolio isn’t growing in 24 months by an average of at least 6% per year, then your advisor is not doing his job and you are definitely not getting your money’s worth. A good advisor should easily be getting you 7-9% a year. If all you did was buy a TSX or S&P 500 Index ETF you would do 8 and 15% respectively, a year over ten years. Mutual funds that don’t perform are NOT safe investments, just because they call them a “Balanced Fund” or “Conservative Growth Fund”.

I have reviewed 5 portfolios recently. All run by independent Financial Advisors. Three of those the annual growth rate over the past 10 years is between 2 and 3.6%. The growth rate is even lower than that over the past 3 years. In two of the portfolios, the MERs (Management Expense Ratios, so the money you pay to the mutual fund operator plus your advisor gets a cut of that) are higher than the growth rate the client is receiving.

Have a look at the attached chart. It clearly shows a lot of mutual funds where there are very high MERs, and the annual MERS exceed the annualized 3 and 5 year growth rates. It is also very clear that paying exorbitant MERs does not result in better performance; it in fact pretty much assures you of exactly the opposite. Long and short, the Mutual fund Company and your advisor are making more money off the investments than you are.

The results of the bottom twelve mutual funds are truly abysmal. I had to put Royal Bank’s RBF1004 into the comparison, which is basically a short term savings account, to get performance as bad as the bottom tier of funds.

The fourth Portfolio, he was actually down over 8% per year over the past 6 years, so his investments are worth less than half of what he initially gave the advisor to work with. It was a VERY significant amount of money he got from an inheritance, so in dollar terms he lost a bundle. The only saving grace is he is 30 years old and has time to make the money back.

On the good news front, one of the 5 was being run by a GREAT advisor. His ten year average was 11% a year and all of it in pretty conservative investments. About 30% was invested in actual real estate that throws off very good cash flow and is increasing in value.

Do not just assume your advisor is doing a good job. It is your money, you have to at least be willing to invest 3 or 4 hours a year to ensure it is being handled properly and to you benefit. There are good advisors, but there are also a ton of bad ones. Never ride a nag hoping upon hope that it will turn into a thoroughbred.

[Twisted Canuck]

Absolutely, 110% correct Dean. What you just posted can't be stressed strongly enough or often enough. There are a lot of 'advisors' making a living off of client's hard earned money, churning their holdings, all kinds of things that only benefit the advisor as he takes his cut.

If you value your hard earned dollars, for God's sake put in the work to find a portfolio manager who will put your money to work for you, getting you a fair return, without raping you in the process.

[cowmanbob]

This forum is very fortunate to have you post on financial stuff.

[Dean2]

This is the public note I posted to the BNS CEO announcing on LinkedIn the Purchase of a minority interest in Key Corp. He is an outside CEO, never had Banking experience. That has never worked out well in the past. Over paying for a minority interest in a dog Bank in the States is a prime example. However, the Board going along with this also points out why BNS has lagged its peers for decades. NEVER buy the dog, for long term hold, only for short term trades, that trades at a discount to its peers for long periods of time. If you are short term trading make darn sure you do real good research and understand what is driving the short term price moves. There is a very good reason the poorest run trades at a discount, always buy the best run company in a sector. Yes Royal Bank trades at a premium, and they pay a lower dividend, but both are warranted.

So you are paying a LARGE premium for a minority interest in a relatively small regional bank that has not performed well. You bought a predominantly consumer and small business bank at a premium, just as the U.S. economy is headed into recession, unemployment is rising and the Fed has been overly slow in dropping rates.

The market does not share your enthusiasm! Your share price is off 4%, after having performed poorly for quite a while. The share price has dropped from $92 in Mar 22 into the $50 to $60 dollar range the past 12 months. Sold my shares in the low $80s when Porter announced his retirement, very glad I did.

My other comment is on AQN -they cut the dividend AGAIN, sold the renewable business at a big discount and have now admitted that their regulated utility business is in far poorer shape than they previously claimed. Shares dropped from $8.50 to under 7 in the last 2 days, after having already dropped from $25 when they announced the Kentucky deal. Going to be a long time and take a whole Board turnover for this thing to come around.

[HighOnTheHills]

there's always bartering

[Dean2]

Originally Posted by cowmanbob

This forum is very fortunate to have you post on financial stuff.

I actually quite enjoy doing the posts as they are a byproduct and tie into stuff I am working on anyhow. I also like when there are others who post their thoughts, especially ones that run counter to what I think, as it helps provide a broader range of options.

This thread is still very popular. There have been over 23,000 views in the last 2 weeks alone, so it is clearly a topic a lot of folks are interested in. Seems to me to be far more useful expenditure of time, than arguing about stuff we have zero ability to impact.

[anchorman]

Originally Posted by cowmanbob

this forum is very fortunate to have you post on financial stuff.

x1000

[Fisherdan]

Originally Posted by Fisherdan

A few companies I like:

ATD - couche-tard: amazing track record. Always growing. IMO the circle k stores are always top notch, and their Frosters are superior to Slurpees!

TFI international: Top shelf trucking company. constantly acquiring and growing. On the other hand, a high PE ratio, and not sure how it will fare if the US consumer slows down.

TVK - terravest industries : interesting small cap that has been growing and growing, and is just starting to get institutional recognition. It’s done super well, but has been correcting a bit lower the last couple months. It is a small cap though, so a lot can happen (up or down).

Just thought I would update… all three stocks trade on the TSX. The last one, TerraVest, came out with earnings today and crushed it. It is a small cap, that doesn’t pay much of a dividend though. So it probably doesn’t fit the Company profile that most people on here are looking for.

I am biased because I worked at a manufacturing company for many years. We made some interesting things, and had the capability to make just about anything. Unfortunately, ownership was not very interested in our business, and it did not grow. The culture slowly deteriorated year after year. When I see a company like TerraVest, which is committed to growth and improvement in what they do, I think back to the company I used to work for, and wish it had been run like this.

ATD
July 7: 79.37
August 14: 82.55

TFII
July 7: 199.59
August 14: 199.90

TVK
July 7: 70.95
August 14: 90.84

TSX
July 7: 22 126
August 14: 22 760

[KGB]

[QUOTE=Dean2;4743713]I actually quite enjoy doing the posts as they are a byproduct and tie into stuff I am working on anyhow. I also like when there are others who post their thoughts, especially ones that run counter to what I think, as it helps provide a broader range of options.

This thread is still very popular. There have been over 23,000 views in the last 2 weeks alone, so it is clearly a topic a lot of folks are interested in. Seems to me to be far more useful expenditure of time, than arguing about stuff we have zero ability to impact.[/QUOTE]

I think we beat the PornHub even!
On a separate note, take a look at these two companies: Lennox international and Comfort System USA…. I’m sure glad I jumped in a few months ago….
And I also started a small position with Palantir Technologies.

[Dean2]

Update to my posts of July 16th and Aug 1st.

Share prices, 52 week low, July 15th, dividend yield today,Aug 1st, price today -

1. Place Low July 15 Dividend Aug1, Aug 19
2. TRP 44.75, 54.00, 6.85% 59.66 $61.16
   
3. TD 73.67, 78.00, 5.0% 80.67 $81.10
   
4. CU 28.13, 30.25, 5.61% 32.71 $33.01
   
5. CPX 33.90, 41.50, 6.11% 43.45 $43.24
   
6. Telus 20.04, 21.24, 6.98% 22.50 $21.87
   
7. BCE 42.58, 44.11, 8.57% 47.10 $46.88

[fishtank]

ATD( owner of circle K) bidding for 7-11 . That’s a huge consolidation in the convenience store market .

[Dean2]

Originally Posted by fishtank

ATD( owner of circle K) bidding for 7-11 . That’s a huge consolidation in the convenience store market .

It is and there is more consolidation in htat space. Sunoco is trying to buy Parkland's refinery from them. They own the On The Run stores ,among other stuff. Think they would be nuts to sell it, they make way more money from refining than they do from their stores and they need the cash flow to service the huge debt they are packing.

Parkland I wouldn't touch becasue oftheir debt load and lousy management and Alimentation Couche Tard I won't buy because they are headquartered in Quebec, which has a LONG history of bankruptcies in even huge companies. Some call that a personal bias, but I have never owned a single share of Walmart either because I totally disagree with their predatory behaviour with suppliers, competitors and customers, as well as the innumerable times they have been caught using child labour in foreign countries. Same with Chinese stocks, no chance I would put money in any of them.

[eric2381]

I know for me, with my disciplines and investing thesis, banks are still
a no buy for me. They will be in the future, but not yet. But I’m looking at a huge picture and long timeline.

[MountainTi]

Just happened to see this. Looks as if a lot of money was lost on this one
Imagine that

https://finance.yahoo.com/quote/BYND...CbLb6eSLlAUQDl

[Sundancefisher]

Originally Posted by MountainTi

Just happened to see this. Looks as if a lot of money was lost on this one
Imagine that

https://finance.yahoo.com/quote/BYND...CbLb6eSLlAUQDl

It was a false vegetarian bubble stock. While the product had to meat… it was extremely unhealthy and heavily processed.

People I knew who liked it… stopped once they saw the salt content lol.

[MyAlberta]

So, I’m listening to some of Trumps talk, and he’s bringing up a few ideas. Massive amounts of electricity needed, AI, and crypto. Sounds to me as his thoughts are to mine Bitcoin for the big win. What’s your thoughts on that investment strategy for a countries policy?

[Cement Bench]

bank stock Scotia should fall tomorrow being august 27th

[roper1]

Originally Posted by MyAlberta

So, I’m listening to some of Trumps talk, and he’s bringing up a few ideas. Massive amounts of electricity needed, AI, and crypto. Sounds to me as his thoughts are to mine Bitcoin for the big win. What’s your thoughts on that investment strategy for a countries policy?

Many on here much more savvy than me, but currency of any kind is a trade play, not an investment. Short it, if they actually mined enough to make it mainstream, it's value should actually fall.

I'm buying the utility that provides the electricity.

[59whiskers]

Originally Posted by roper1

Many on here much more savvy than me, but currency of any kind is a trade play, not an investment. Short it, if they actually mined enough to make it mainstream, it's value should actually fall.

I'm buying the utility that provides the electricity.

I like utility power generation companies that are not loaded up with debt payments on the purchase of the experimental renewable wind and solar assets that could not pay down debt and resulted in dividend cuts, AQN was a good company at one point until they jumped on the renewable band wagon. ACO, CU, and ALTA Gas have paid well so far and are in it for the long haul.

[ehrgeiz]

Originally Posted by roper1

Many on here much more savvy than me, but currency of any kind is a trade play, not an investment. Short it, if they actually mined enough to make it mainstream, it's value should actually fall.

I'm buying the utility that provides the electricity.

Bitcoin shouldn't be defined solely as a currency; it's an incredibly important innovation that doesn't quite fit into any traditional analogs. The consensus protocol caps the supply at 21,000,000 BTC, which is expected to be fully mined around the year 2140ish. The BTC block reward is halved approximately every four years leading up to that point. After the final block reward, it's assumed that miners will be incentivized by transaction fees or possibly some other layered innovation.

Anyway, there are a lot of hard miles between 2024 and 2140 to come. Maybe we'll have invented the replicator by then and won't need a scarcity engine.

I better disappear before Dean2 scolds me for talking crypto in the tradfi thread!

[urban rednek]

Originally Posted by ehrgeiz

Bitcoin shouldn't be defined solely as a currency; it's an incredibly important innovation that doesn't quite fit into any traditional analogs. The consensus protocol caps the supply at 21,000,000 BTC, which is expected to be fully mined around the year 2140ish. The BTC block reward is halved approximately every four years leading up to that point. After the final block reward, it's assumed that miners will be incentivized by transaction fees or possibly some other layered innovation.

Anyway, there are a lot of hard miles between 2024 and 2140 to come. Maybe we'll have invented the replicator by then and won't need a scarcity engine.

I better disappear before Dean2 scolds me for talking crypto in the tradfi thread!

The consensus protocol (ie. software) caps it at 21,000,000? Bwahaha!

Bitcoin was created by techbros to facilitate untraceable criminal activity and money laundering across international borders. Once it was operating, the techbros realized they could make even more money fleecing the easily duped masses, which they have been doing with great success ever since.

Bitcoin mining has been accurately described as: Keeping your truck idling 24/7 to solve Sudokus you can then trade for heroin.

Can the average investor make money on Bitcoin? Yes they can, same as the average gambler could rake in big bucks at any Las Vegas casino back in the early days of the strip. Just enough winners to keep the suckers coming in the door.

[ehrgeiz]

^
Wow, every assertion you made is totally off base. That’s okay, just tells me you haven’t really studied Bitcoin and we’re still so early.

I don’t want to send the thread on more of a tangent though so that’s probably good enough.

[Dean2]

Just got back from a trip to Bring Cash. If I didn't have family there I would not go there in high season for sure. Fairfield Revelstoke $360 a night all in, same room in Oct $160 a night all in. Hold true pretty much everywhere in the province.

This thread has had 47,000 views in the last 3 weeks. I have received a great many PMs the last few weeks asking for recommendations on a good financial advisor. I unfortunately don't have any suggestions for folks with portfolios under $10 million dollars. I have re-posted a selection of my more recent posts from this thread on advisors. Outside of the fee for service guys that create a plan and structure for an hourly fee, and don't actually run your portfolio, good help is hard to find.

As I have often said, almost no advisor can beat the market indexes over 3, 5 or 10 years. Those that can, aren't working with small portfolios. The reason index ETFs like HXT, VFV, HXS etc. are so popular is they have VERY low MERs and out perform 95% of all actively managed portfolios.

Originally Posted by Dean2

This showed up on the BNN feed today.

https://www.bnnbloomberg.ca/4-ways-t...ment-1.2018184

Nearly half of Canadians who invest through advisors are shopping for new talent.

According to the 2023 Ernst and Young Global Wealth Research Report, 45 per cent of surveyed people said they were looking for better portfolio managers – a 24 per cent increase since 2021.

The waning confidence in professional management is likely linked to how well advisors navigated the market turmoil caused by the pandemic. As the lockdowns took hold in 2020, investment firms reported an influx of new clients. A survey commissioned by Manulife Investment Management at the time showed 63 per cent of respondents were looking for an advisor, compared with half in the year before COVID.

If your new year’s resolution is to review your investment advisor, or if you are in the market for one, here are four ways to tell if they are earning their fees.

1. HOW DO YOUR RETURNS COMPARE WITH THE BROADER MARKET

2023 was a good year for the two main asset classes that make up a balanced investment portfolio: stocks and fixed income.

The U.S. stock benchmark S&P 500 advanced by 25 per cent, the Canadian stock benchmark TSX Composite returned over eight per cent, and guaranteed investment certificates (GICs) paid yields as high as five per cent.

Your portfolio should reflect those stellar performances if it is properly diversified among asset classes, major sectors and geographic regions.

Inversely, properly diversified portfolios would likely have shown losses in 2022 when stock markets fell and yields were much lower. It’s long-term gains you are looking for.

If your returns are consistently out of whack with broader markets, ask questions. Lagging portfolio performance might be attributed to specific misunderstandings relating to your risk tolerance or return goals.

2. HOW MUCH OF A BITE ARE FEES TAKING?

A portfolio that consistently underperforms the broad markets could be weighed down by excessive fees.

Professional management costs money. The only way for most Canadians to access professional management and diversification is through mutual funds, which charge an annual fee based on a percentage of the amount invested.

Depending on the fund, those fees can top three per cent, which can shrink a return of five per cent to two per cent.

Returns dwindle further when other fees such as loads and commissions are piled on.

A good advisor knows the best funds for the buck, but should also find ways to minimize fees over time by shifting assets to lower cost exchange traded funds (ETFs) or investing directly in equity markets.

There are other ways advisors are compensated that could cost less, including flat fees.

Fee rates should fall as the portfolio grows and the dollar amount increases. High net worth investors generally strive for total fees under one per cent of the amount invested.

3. IS THERE A STRATEGY FOR KEEPING MORE TAX DOLLARS INVESTED?

Part of an advisor’s job is to ensure your savings are invested in a tax-efficient manner. Keeping more of your tax dollars to compound in your portfolio is a risk free way to boost returns.

If too much money grows in a registered retirement savings plan (RRSP), for example, investments could reach a point where withdrawals will be fully taxed at a high marginal rate. Eventually, minimum withdrawals will be mandatory, putting government benefits like old age security (OAS) in jeopardy.

Before it gets to that point, an advisor should strategically channel savings into tax-efficient vehicles such as RRSPs, tax free savings accounts (TFSAs), income splitting tools like spousal RRSPs and even non registered investment accounts.

4. DOES YOUR ADVISOR EVEN KNOW YOU?

Do you only hear from your advisor when RRSP season rolls along? Portfolio management is a year-long event and regular communication is essential.

Your advisor should be in touch with you by phone or email, or at the very least a regular newsletter explaining any market-moving situation and assuring you your investments are well positioned for what comes next.

In addition, a good advisor should know your retirement goals, tolerance for risk and personal circumstances that impact your finances.

They should also know your big financial picture: debt levels, home equity, workplace pension plans and other major assets and liabilities.

If any of these points ring true, it’s time for a chat – or a change.

Originally Posted by Dean2

Big Zeke _ you hit the nail on the head. No good quality advisor is going to look at an account that is less than a million, the really good ones, $5 million and up. It is exactly why so many folks are stuck with low quality, poorly educated advisors that work in the mass market. Anybody that starts out in the mass market that is really good, ends up moving up into the higher tiers really quickly. You can get guys to compete by splitting a ten million portfolio, you won't get that to happen with $200,000 bucks as most of the advisors in that range are salaried, with perhaps a small incentive overlay, despite the fact the companies they work for, Banks, Life Insurance Companies, Investment houses etc. are charging 1 to 2% of the portfolio value for management, and that is over and above Mutual Fund or any other fees. If you ask most people dealing with an in-house advisor, they have no idea what so ever that these extra fees are being charged. Most are shocked when they ask the specific question.(So on a $200,000 portfolio you are paying the Bank between $2 and $4,000 a year, for the crap advice you are getting from their advisor, over and above the 2% average MER for the in-house mutual funds they have you in, and up to 6% MER if those mutual funds are funds comprised of other mutual funds.)

So give that some thought, your fees are min $5,000 a year to as much as $16,000, and people wonder why they get next to no return over years and years of being invested. Someone else is skimming off all the cream, and then some in many cases.

Most people would be far better off with a pay for service Financial planner. These guys charge a flat hourly rate, most of the better ones are in the $250 and up range, but they have a responsibility to provide you with a quality overall financial plan. You can pay for a lot of professional time and still pay WAY less than you are getting pillaged for already.

Originally Posted by bdub View Post
Could not agree more and here is some math coming at it from a different angle for folks to consider. I don't think people really think through what exactly this means to their retirements when they start out and surely advisors don't point it out, ours sure didn't before they got the boot years ago.

Say you start out saving at age 30 with the goal of retiring at 55. At the end of every year you put $20000 into your RRSP and it earns 10% per year.

At age 55 you will have 1.96 million.

Now take off 2% in fees every year to the advisor. At age 55 you will have 1.46 million.

Now lets say you have an advisor charging 2% that puts you in ETF's charging .5% for fund fees plus his 2%. Down to 1.36 million.

Now lets say you have a real dirt bag advisor charging 2% who sticks you in a mutual fund that also charges another 2% a year, not that uncommon to see fees that high for mutual funds in Canada. Down to 1.1 million.
When I took over my own stuff, I was in exactly the last scenario.

So, if at the end of the year your advisor doesn't provide enough alpha(extra return) above the benchmark that makes up for their extra fee's why are you paying them? What other service do they provide?

I could go off on a completely different tangent on the efficiency of the stock market, but the point is you don't have very good odds of finding an advisor that will provide alpha above and beyond their fees over time. You are better off sticking your $20000 in a couple low fee ETF's each year and forgetting about it until you are 55. Most likely you will be several hundred thousand's of dollars ahead.

Sorry to offend any advisors on here but that's the truth imo. And check my math, I didn't.

Originally Posted by Dean2

While getting educated in the markets and a better understanding is very good 90% of all people never do that. They go into the bank, get sold a weakass mutual fund like TDB887, that has a 2.02% Management Expense ratio, and is completely made up of a bunch of other mutual funds, that also have a 2-3% management fee each, meaning at least 4 and up to 6% is going to the fund for doing nothing, along with trailer fees. Long and short of which is, you make no money even over 25 years.

For guys that don't know and know better than to listen to the Bank's supposed financial advisor, an index ETF makes perfect sense. Putting 60% into a broad U.S. index fund and the other 40% into a broad Canadian index fund provides a much better return and diversifies you into the two strongest markets in the world, without having to pick the right stocks. Something like HXS, which is an index fund on the S&P500 U.S. index but sold in Canadian dollars, and HXT or ZLU, which are the Canadian TSX 60 Index are just a couple of choices.

Take a look at this comparison of Index ETFs versus the really weak mutual funds most banks sell. These happen to be TD but most of the bank ones are the same. To be fair however, not all ETFs are created equal either. See second screen shot.

Originally Posted by Dean2

Funny you should ask that, I was just working on a list to post. These are just some suggestions and options; you can of course tailor some of the questions or add more depending on your personal situation.


Skill testing and service level, cost questions to ask a potential advisor, or if you already have one, good way to assess what you have.

1. For Eligible Canadian Dividends, what is the dollar value of dividend income that I can earn basically tax free. Answer, approximately 50,000 per year in the absence of any other income.
2. How does a stock Drip program work. The monthly or quarterly dividend payments are re-invested automatically, no commissions are charged for the stocks bought with the dividends.
3. How can I make my mortgage interest tax deductible. Use your investments to pay off your mortgage, borrow the money against your house to buy those investments back. You make exactly the same payment at the same interest rate but the interest is tax deductible. The stocks are still unencumbered, as in not used for security, so you can sell them at any time to pay off the mortgage, subject to the early payout penalty, or for other uses. If you sell the investments down to below the mortgage loan value you will reduce the amount of interest that is deductible.
4. What is my Lifetime to date contribution limit for a TFSA. From 2009 till now 2022 $81,500. All dividends, interest and capital gains are not taxed, however capital loses are also not tax deductible.
5. Am I better off contributing to an RRSP or a TFSA. The answer to this is highly dependent on your current tax rate. You annual RRSP contribution limit builds up if you don’t deposit the money in that year so you are better off waiting until your marginal tax rate is above 35%. Below that you don’t maximize the available tax deduction and you could easily be paying tax on money you later withdraw from the RRSP at a tax rate higher than you were at when you took the deduction. Prior to that putting the money into a TFSA is generally better. Once your marginal tax rate gets to 35%+ you can borrow to use the accumulated contribution limit but the interest on that loan is not tax deductible. However, if you invest that contribution limit money every year into stocks outside an RRSP, you can sell them, put the money in RRSP and then borrow to buy back the stocks you sold and that loan interest is tax deductible.

The Canada Revenue Agency generally calculates your RRSP deduction limit as follows:

• your unused deduction room at the end of the preceding year
Plus
• The lesser of the two following items:
o 18% of your earned income in the previous year
o the annual RRSP limit (for 2021, the annual limit is $27,830)
• That exceeds one of the following items:
o your pension adjustments (PA)
o a prescribed amount

6. Can I setup more than 1 RESP for my child and can my parents set one up for them too. You can have as many as you like, but between all of them, including parents, grandparents etc, the annual/lifetime contribution limit is the same so you have to know what each is contributing in total.

Yearly and lifetime RESP contribution limits

From 1998 (the first year the program started) to 2006, inclusive:
• annual contribution limit: $4,000;
• lifetime contribution limit: $42,000 (including any contributions made prior to 1998).
From 2007 to present:
• no annual contribution limit;
• lifetime contribution limit: $50,000 (including all contributions made prior to 1998).
While there are currently no annual contribution limits, you can receive the Canada Education Savings Grant (CESG) only on the first $2,500 in contributions per year, or up to the first $5,000 in contributions, if sufficient carry forward room exists. Any contributions over and above these amounts will not receive any CESG for the current year or any subsequent years. All contributions exceeding $50,000 limit will not attract any grant even if the maximum $7,200 of grant is not reached.
Ask your RESP provider if your plan allows for transfers. Also, ask them to explain any conditions or penalties that may apply if you over-contribute to the account.

7. What fees do you charge, over and above any ETF, mutual fund or trading commissions? What are the portfolio dollar values at which the fee changes and do you have a list of those levels and rate?.
8. Any advisor fee above 1% of your portfolio value should come with a performance clause. Is your fee dependent on the performance you generate?
9. How often will you contact me during the year? Should be a minimum of 2X. What is your policy regarding contact frequency during market volatility?
10. Who else works on my account and what is the alternate contact if you are away? What is the process if you quit or are assigned to another portfolio of clients?
11. Approximately how large a book of business and how many clients do you currently manage? Any advisor with more than about 150 clients is not going to be giving you much personal attention.

Originally Posted by Dean2

These last few posts illustrate a couple of things:

1) Dollar cost averaging works in all markets and it is one of the key reasons why re-investing dividends via the drip functions are such a critical part of the overall returns on these stocks
2) Market timing doesn't work. If you miss just a few of the major up days in a cycle you miss a ton of the up side
3) Even in the worst decades for stock market performance, if you buy quality stocks over that time you will still be up by large amounts over 30 years. Even in the example Fisherdan talks about, where you put in 12,000 in 1929 and only had a little over 7 by 1939, if you left that 7 invested it is now worth a few million.
4) Over concentration of your portfolio can be very detrimental - as in having 100% in Tech, or having put it all into the Japanese market 30 years ago.
5) If you buy and long term hold the wrong stocks you can get results from no increase to losing all of it. Chasing the current fad and hot ticket doesn't work.
6) If you don't know what the right stocks are and validate this through your own research, you are better off in broad market/sector ETFs than picking the wrong stuff.

A person can make a lot of money in the market, especially over 20-40 years, but it isn't just dead simple. You need to learn a lot about investing or learn a little and then you need a real good quality advisor. Both paths take a lot of work to either learn or to sift through advisors to find a good one. You should have a list of at least 6 skill testing questions you ask every advisor you are interviewing. A good one should be able to answer at least 5 off the top of his head.

For those that invest the time and effort, the rewards can be great with either approach.

Originally Posted by Dean2

I have been looking over the investment portfolios of quite a few people the past couple of weeks, all close friends and relatives. I do not give investment advice, nor do I manage other's investments any more, all I can say is what I would do and think. What I can see is there is a definite pattern and it is not what I consider good. If you have a financial advisor and they have not reached out to you in the last two months, it is time to get a new advisor. The person you have is either incompetent or bone lazy. Wants your money with no work.

The portfolio mixes I am seeing are not in tune with what I would consider appropriate for the current environment and I am a VERY conservative investor. Over 2/3s of the portfolios I have been asked about have very large fixed income components. Many are buried in Mutual Funds variously termed as conservative income funds, Conservative Balanced Growth Funds etc. The other thing I am seeing a lot of, is people being sold mutual funds that are composed of a selection of the same issuers other mutual funds. This has to rank among the biggest fee collection rip offs in current investing. The first set of mutual funds collect a 1.7 to 2.5% MER and the second fund, made out of the selection of these funds, collects another 2% MER for doing less than sweet FA.

If you are in mutual funds take a look at what the funds holdings are. If there is a large component of Bond/fixed income, consider selling them and getting into something with no Bonds. IF you have mutual funds that are made up of other mutual funds, you need to look at getting a much better fund to work with and you should seriously be looking at the advisor that sold you that crap.

This is not the time to be dealing with an advisor you never hear from and you need to invest the time and effort to understand what you are invested in or you can end up massively screwed over by bad advice and counsel. Please, take the time to pull up your investments and review the holdings that are disclosed for them. Also, critically evaluate the value your current advisor is bringing to the table. You may need to talk to their manager and get a better person to replace them. You only get as good as you ask for and insist on. Best of luck.

[Savage Bacon]

Warren Buffet sold off another crap ton of bank of America stocks.

Sent from my SM-S901W using Tapatalk

[Dean2]

Originally Posted by Savage Bacon

Warren Buffet sold off another crap ton of bank of America stocks.

Sent from my SM-S901W using Tapatalk

Yes he has, but to retain perspective, they still own a very large position. Berkshire bought into B of A in 2011, for 5 Billion. His investment in that, prior to the recent sales, had grown to almost $40 Billion. The amounts he is selling sound large at $845 million this time and about $600 million previously, but they still have about $36 Billion invested. All in, pretty decent return in 13 years.

Warren Buffett Sells Another $845M In Bank Of America Stock
The move marked the seventh time the billionaire has cut his stake since July
By Bruce Golding
Published 08/31/24 AT 8:12 PM EDT
Share on Facebook
Share on Twitter
Share on LinkedIn
Share on Reddit
Share on Flipboard
Share on Pocket
Warren Buffett
Warren Buffett (L) is driven to a morning session at the Allen & Company Sun Valley Conference on July 12, 2023, in Sun Valley, Idaho. Kevin Dietsch/Getty Images

Influential investor Warren Buffett's holding company dumped another $845 million in Bank of America stock — marking the seventh time it has cut its stake in the financial institution since July.

Buffett's Omaha, Nebraska-based Berkshire Hathaway Inc. — Bank of America's largest shareholder — disclosed the latest sale in a regulatory filing Friday, Reuters reported.

The 21.1 million shares were unloaded from Wednesday through Friday, Reuters said.

Buffett, who turned 94 on Friday, invested in Bank of America in 2011 when Berkshire Hathaway bought $5 million worth of preferred stock and warrants to shore up the lender following the global financial crisis of 2007-09.

The bank's share price more than doubled over the next two years, giving Buffett $5.27 billion in paper profits, plus $300 million in dividends annually, CNBC reported at the time.

Last year, Buffett told CNBC that he liked Bank of America CEO Brian Moynihan "enormously" and that buying its stock was a "very decent deal for us."

"And I just don't wanna, I don't wanna sell it," Buffett said.

But Berkshire began aggressively selling its BofA stock on July 17, marking the first time it trimmed its stake in the company since 2019.

Berkshire has sold Bank of America shares during 21 of the past 33 trading sessions, generating about $6.2 billion in cash, CNBC said Saturday.

Berkshire remains the bank's biggest investor, with 882.7 million shares that comprise an 11.4% stake worth nearly $36 billion, but it's approaching the Vanguard Group's 639 million shares, according to CNBC.

On Wednesday, Berkshire became the first non-tech U.S. company valued at more than $1 trillion.

Buffett, nicknamed the "Oracle of Omaha" for his investing prowess, has a personal fortune estimated at $149.8 billion that makes him the world's sixth richest person, according to Forbes.

[Savage Bacon]

Originally Posted by Dean2

Yes he has, but to retain perspective, they still own a very large position. Berkshire bought into B of A in 2011, for 5 Billion. His investment in that, prior to the recent sales, had grown to almost $40 Billion. The amounts he is selling sound large at $845 million this time and about $600 million previously, but they still have about $36 Billion invested. All in, pretty decent return in 13 years.



Warren Buffett Sells Another $845M In Bank Of America Stock

The move marked the seventh time the billionaire has cut his stake since July

By Bruce Golding

Published 08/31/24 AT 8:12 PM EDT

Share on Facebook

Share on Twitter

Share on LinkedIn

Share on Reddit

Share on Flipboard

Share on Pocket

Warren Buffett

Warren Buffett (L) is driven to a morning session at the Allen & Company Sun Valley Conference on July 12, 2023, in Sun Valley, Idaho. Kevin Dietsch/Getty Images



Influential investor Warren Buffett's holding company dumped another $845 million in Bank of America stock — marking the seventh time it has cut its stake in the financial institution since July.



Buffett's Omaha, Nebraska-based Berkshire Hathaway Inc. — Bank of America's largest shareholder — disclosed the latest sale in a regulatory filing Friday, Reuters reported.



The 21.1 million shares were unloaded from Wednesday through Friday, Reuters said.



Buffett, who turned 94 on Friday, invested in Bank of America in 2011 when Berkshire Hathaway bought $5 million worth of preferred stock and warrants to shore up the lender following the global financial crisis of 2007-09.



The bank's share price more than doubled over the next two years, giving Buffett $5.27 billion in paper profits, plus $300 million in dividends annually, CNBC reported at the time.



Last year, Buffett told CNBC that he liked Bank of America CEO Brian Moynihan "enormously" and that buying its stock was a "very decent deal for us."



"And I just don't wanna, I don't wanna sell it," Buffett said.



But Berkshire began aggressively selling its BofA stock on July 17, marking the first time it trimmed its stake in the company since 2019.



Berkshire has sold Bank of America shares during 21 of the past 33 trading sessions, generating about $6.2 billion in cash, CNBC said Saturday.



Berkshire remains the bank's biggest investor, with 882.7 million shares that comprise an 11.4% stake worth nearly $36 billion, but it's approaching the Vanguard Group's 639 million shares, according to CNBC.



On Wednesday, Berkshire became the first non-tech U.S. company valued at more than $1 trillion.



Buffett, nicknamed the "Oracle of Omaha" for his investing prowess, has a personal fortune estimated at $149.8 billion that makes him the world's sixth richest person, according to Forbes.

Dang that's a lot of money to play with.

Sent from my SM-S901W using Tapatalk

[Dean2]

Originally Posted by Savage Bacon

Dang that's a lot of money to play with.

Sent from my SM-S901W using Tapatalk

Yes it really is. Figure he went from nearly zero to aTRILLION in about 40 years truly is amazing. Kind of like Elon Musk going from harvesting grain in Sask when he was 20 to being worth nearly a trillion personally, not to mention what the companies he built are worth.

[fishtank]

That $5 billion investment in BofA had a bunch a warrants and preferred shares so his initial investment was paid for a long time ago and is free rolling in it . Feels like he has one more big deal coming .

[Dean2]

Bank of Canada dropped rates another .25 yesterday and strongly indicated more drops to come. The rotation into the Value/Dividend paying stocks is accelerating. May want to keep an eye on this over Sept, which is a traditionally tough time of year for stocks and presents buying opportunities.

List below is justg a representative sample. There are lots more.

Share prices, 52 week low, July 15th, dividend yield today,Aug 1st, Aug 19th price and today -

1. Place Low July 15 Dividend Aug1, Aug 19 Sept 5
2. TRP 44.75, 54.00, 6.85% 59.66 $61.16 $63.66
3. TD 73.67, 78.00, 5.0% 80.67 $81.10 $81.07
4. CPX 33.90, 41.50, 6.11% 43.45 $43.24 $45.41
5. Telus 20.04, 21.24, 6.98% 22.50 $21.87 $22.71
6. BCE 42.58, 44.11, 8.57% 47.10 $46.88 $48.60
7. HXS 57.66 78.96 0.0% 78.32 $77.66 $76.25

This Forum has about 80,000 members and less than a couple of thousand that are active, with rarely more than 120 signed on at any given time, but apparently a lot of guests read these boards. Aug 1st this thread had about 598,000 views. As of Sep 5 672,582, so 74,600 views for a round number, in a month. Folks are definitely interested in the topic. Keep the posts coming guys.

[Jim Blake]

RBC has been doing very well. Their earnings numbers are beating the last years quarters numbers by a very positive amount. Dean was spot on saying the Bank is the best managed!!