Re: Follow the Money
Jacob
1/11/2012 6:44:54 AM
"All financial advisers claim to be trustworthy experts"
Jack you are right, they seems to be like that. But in practical are they? No from my experience, at least in equity based service. They can suggest something, but the returns are purely based on performance of the company and share values. In debt and commodity segment I think they are trustworthy because their fluxuations are very less.
Re: Follow the Money
yalanand
1/11/2012 1:48:29 AM
Do you think it is possible to create a website for investors to give reviews of financial advisers
@Value Hiker, that is a very good suggestion. I think we can create an android/iPhone app listing all the legal financial adviser with rating so that investor can quickly check the advisers background before approaching him.
Re : Scary Truths About Financial Advisers
yalanand
1/11/2012 1:45:01 AM
Reps are paid a straight commission to sell investment products.
@Jack, thanks for this post, really an eye opener. I think its very important for the investor to do his own homework before approaching any Reps or even better would be to invest through online.
Yes, and when you love someone, you rarely vet them the way you would a stranger...and may only realize how little they really knew until it is too late. How many people bought houses with serious defects because they trusted a relative to "inspect" it rather than hire a professional?
Re: What makes a good advisor
Broadway
1/10/2012 9:40:34 PM
I'm always fascinated when I come across friends of friends who claim to be financial advisers or even investment managers for their friends and family. They claim to be running their own legitimate business but are actually just playing with the trust and kind heartedness of those who love them. Maybe some of these folks are legit, but isn't that a big red flag ... if the only people willing to "trust" their money to an adviser are their parents, siblings and cousins?
Watchdog, do you think it is possible to create a website for investors to give reviews of financial advisers? we have Yelp for restraurants, mechinical shop, why not a dedicated website to review financial advisors by average Joes from main street
Re: Follow the Money
Watchdog
1/10/2012 6:02:23 PM
My only additional comment is to obtain advisor responses in writing. Less scrupulous advisors are famous for telling investors what they want to hear to gain control of their assets.
Then they develop selective amnesia if there is a problem.
They get away with amnesia when it is their word against the investor's.
Investors can avoid this problem by getting advisor responses in writing. If they won't provide written disclosure do not buy what they are selling.
Jack,
Great post. To me the key is always to "follow the money." In any industry, there are often flawed business models that may distort the integrity of the client/service provider relationship. You always have to ask yourself where the incentive is in the relationship.
The first thing I ask about in any financial relationship is how my service provider is getting paid. They should give me an honest answer. If they can't answer the question or they try to hide something, you know it's wrong.
There is nothing wrong with asking this question. And I think you will find that the financial advisors with integrity will answer the question with integrity and are interested in transparency.
For example, somebody tries to sell you an annuity. "Do you get a commission if you sell me this annuity? How much are the fees relative to the product?"
Annuities in particular are famous for being taken advantage of by financial advisors and sales agents. For example the annuity that yields 5% annually but has a 6% upfront sales load. I'm not saying all annuities are bad, I'm just saying ask the questions.
Thanks for bringing up the point and I hope our readers will learn to ask the right questions and get more transparency into the financial services market.
"Convicted criminals can obtain a securities license, as long as their crimes were not related to securities."
Now that is an eye-opener.
Re: What makes a good advisor
Watchdog
1/10/2012 12:53:51 PM
Wall Street likes to treat investors like mushrooms. The less investors know, the more Wall Street can get away with, for example investment bubbles and trillion dollar losses.
Investor Uprising is definitely shining some light in the cave.
At some point investors have to say, "enough already", and begin taking more responsibility for their financial futures.
It is easy to turn their futures over to advisors, but they better be very sure they have selected the right advisors for the right reasons.
The blogs and comments posted on Investor Uprising do not reflect the views of Investor Uprising, PRNewswire, or its sponsors. Investor Uprising, PRNewswire, and its sponsors do not assume responsibility for any comments, claims, or opinions made by authors and bloggers. They are no substitute for your own research and should not be relied upon for trading or any other purpose.
|
 |
Latest Blogs
Telecom-equipment maker Ciena is a stock trader’s dream, as long as the timing is correct.
The FTC is offering a $50,000 cash prize to the person or group that can come up with a solution to those annoying robocalls.
Akamai is in the middle of four significant tech trends.
John Malone of Liberty Media will be taking over Sirius XM satellite radio when the existing CEO Mel Karmazin steps down. What's it mean?
Demand for students of the humanities exists, despite widespread aspersions on the discipline.
IU Education
Resources to help you become a better investor
Investor Uprising on Twitter
25 market-moving companies we're tracking
|
Tweet This