Should You Be Using a Portfolio Manager?

If you're unsure whether your asset allocation is appropriate, you might benefit from the personalized advice of a professional money manager. [Liberty Through Wealth]( SPONSORED [5G Stock CRUSHES Earnings!!]( [5G SuperStocks]( Wall Street is loading up on shares of one 5G SuperStock (with more than $2 billion invested!). Why? Because the stock brings in more cash than IBM, Facebook and even Google! Yet it trades for just $3. [Get the scoop on the 5G SuperStock right here.]( Tell Us... Do you think we're in a financial bubble right now? [Click here to answer.]( THE SHORTEST WAY TO A RICH LIFE Should You Be Using an Account Manager? Alexander Green | Chief Investment Strategist | The Oxford Club [Alexander Green] In a previous column, I suggested that investors check their asset allocation to make sure their [portfolios]( are not too risky or aggressive. Many readers gave their ages and financial goals and asked whether their asset allocations were appropriate. In most cases, there wasn't enough information to make a determination. More to the point, I'm not allowed to give personal investment advice. And that's a good thing since I know only a small percentage of my nearly half-million readers. [Tech Wreck: Netflix]( [Click here]( to watch Alex's latest video update. Some noted that asset allocation is a term they often hear but don't fully understand. "Asset allocation means diversification, right?" asked one reader. [Not exactly](. An S&P 500 index fund is broadly diversified. (After all, you own 500 companies.) But unless your goal is to be 100% invested in large cap U.S. stocks, it's not your best asset allocation. Asset allocation refers to how you divide your portfolio among different noncorrelated asset classes, such as foreign and domestic stocks, high-grade and high-yield bonds, real estate investment trusts, Treasury Inflation-Protected Securities (TIPS), etc. Studies show that your asset allocation is responsible for nearly 90% of your portfolio's long-term return. (The rest is due to factors like security selection, investment costs and taxes.) Not knowing your asset allocation - or whether it is appropriate for your circumstances - is a fundamental mistake. (And fundamental mistakes are the hardest to bounce back from.) Many of the individuals asking these questions might benefit from a managed account. Historically, only institutional investors used professional money managers to run their portfolios. Until recently, individual investors could access these managers only through mutual funds, unless they had millions to invest. But in recent years, investment minimums - and, just as importantly, costs - have come way down. So managed accounts are now a viable option for plenty of investors. Here's how they work... When you open a managed account, you sign a limited power of attorney to let an investment professional run your portfolio - or, at least, the portion that you turn over to him or her. SPONSORED [Look at What Obama Is Up to Now!]( On September 16, 2020, Obama will get his last laugh. That's when a group of his hand-picked cronies may single-handedly bring this raging bull market to a sudden and destructive end. To continue reading, [click here](. The manager begins by determining your investment goals, time horizon and risk tolerance. A 30-year-old's portfolio, for instance, would look very different from an 80-year-old's. Here are the benefits of a professionally managed account: - Custom asset allocation. The portfolio is constructed based on your personal investment goals, not a general strategy like "growth" or "income." - Personalization. The account manager will take into account your specific circumstances: age, experience, time horizon and risk tolerance, for example. - Transparency. Unlike with mutual funds, you know what's in your account. You can see what you own. - Tax management. Your portfolio can be run so that taxes on dividends, interest and capital gains are minimized or eliminated. (Tax-free bonds, as one example, should almost always be state-specific.) - Competitive fees. Account managers generally charge a flat fee rather than full-service brokerage commissions. - Performance. Account managers often have favorable track records. - Convenience. If you are too busy to give your investments the attention they deserve - or if you are an inexperienced or emotional investor - having a professional run your portfolio may be your best solution. Who would not benefit from a managed account? Primarily do-it-yourselfers. If you enjoy the investment process, have the time and expertise to implement your [investment strategy]( and - most importantly - are satisfied with the results, you don't need to turn your money over to someone else to manage. On the other hand, there are few hobbies more fraught with danger than horsing around with the money you've spent a lifetime accumulating - and plan to live on in retirement. I recently spoke with Greg Galloway - president of Fund Advisors of America in Orlando, Florida - who runs many managed accounts based on the Club's asset allocation and investment recommendations. "Look," he said with a laugh, "I'll be the first to concede that managed accounts aren't for everybody. However, I speak with a lot of investors who realize they could be doing a lot better than they are. They know they should asset allocate their portfolios, but they don't. Or they aren't sure how. They don't want to be over- or under-diversified, but we look at their portfolios and see that they are. They know they should run trailing stops behind their stocks, but they get distracted or forget. "Many of these people are smart, sophisticated investors, incidentally. They're just too busy running a company, taking care of their families, traveling or pursuing other interests to give their portfolios the attention they deserve." How about investors who say they can save money by doing it themselves? "Sometimes true," said Greg. "After all, you can trade stocks today for just a few dollars. But, remember, the most important question is 'Am I satisfied with my investment returns net of whatever I'm paying?' "I often ask prospective clients, 'If no one else would pay you to manage their money, are you really the best person to manage your own?' "Their honest answer is generally a sheepish 'No.'" In my view, whether you need a managed account really boils down to whether you like to grow your own tomatoes. Stick with me a moment... Some people are natural gardeners. They want to till the soil, plant the seeds, water them, fertilize them, weed them and, eventually, harvest them. When they eat those tomatoes, they have the pride and satisfaction of knowing they grew them themselves. Other folks are too busy, ill-equipped or simply uninterested in growing their own tomatoes. They just stop at the farmers market or the store and pick up a bag. They don't want to grow their own tomatoes. If you'd like to learn more about managed accounts, here are two good places to start (both are part of the Club's Pillar One Advisors program)... Greg Galloway and Rick Pfeifer of Fund Advisors of America run managed accounts through Charles Schwab, using Oxford Club recommendations, among other strategies. They also offer a complimentary portfolio review. (Minimum account size is $100,000.) Rick and Greg can be reached at 800.438.3040 or 407.667.4729. If your interest is gold and other precious metals, you may want to talk to the folks at Asset Strategies International. They focus on currencies, precious metals and offshore accounts. Contact Michael or Rich Checkan at 800.831.0007 or 301.881.8600. Incidentally, Oxford Club Members are entitled to discounted fees and special services at each of these firms. We at Liberty Through Wealth are not brokers, dealers or licensed investment advisors. (We mention these individuals for information purposes only and do not receive compensation for any arrangement you may eventually reach with them.) In sum, managed accounts are an excellent choice for some investors. Others, of course, prefer to grow their own tomatoes. The two are hardly mutually exclusive. Many investors turn their serious money over to a pro and keep a smaller account on the side for trading and speculation. Either way, it never hurts to know your alternatives. Good investing, Alex [Leave a Comment]( For Alex's latest video updates, subscribe on [YouTube](. JOIN THE CONVERSATION [Facebook]( [Facebook]( [Twitter]( [Twitter]( [Email Share](mailto:?subject=A%20great%20piece%20from%20Liberty%20Through%20Wealth...&body=From%20Liberty%20Through%20Wealth:%0D%0A%0D%0AIf%20you’re%20unsure%20whether%20your%20asset%20allocation%20is%20appropriate,%20you%20might%20benefit%20from%20the%20personalized%20advice%20of%20a%20professional%20money%20manager.%0A%0D [Email Share](mailto:?subject=A%20great%20piece%20from%20Liberty%20Through%20Wealth...&body=From%20Liberty%20Through%20Wealth:%0D%0A%0D%0AIf%20you’re%20unsure%20whether%20your%20asset%20allocation%20is%20appropriate,%20you%20might%20benefit%20from%20the%20personalized%20advice%20of%20a%20professional%20money%20manager.%0A%0D MORE FROM LIBERTY THROUGH WEALTH [The True Road to Greater National and Personal Wealth]( [The Biggest Stock Market Bubble in History]( [Will 2021 Bring a Repeat of the Dot-Com Bubble?]( SPONSORED [Do You Own ANY 5G Stocks?]( [5G Design Graphic]( calls 5G "the lifeblood of the new economy." If you don't invest now, you'll regret it later. [Click here for details on the top 5G stock...]( [The Oxford Club]( You are receiving this email because you subscribed to Liberty Through Wealth. Liberty Through Wealth is published by The Oxford Club. Questions? Check out our [FAQs](. Trying to reach us? [Contact us here.]( Please do not reply to this email as it goes to an unmonitored inbox. [Privacy Policy]( | [Whitelist Liberty Through Wealth]( | [Unsubscribe]( © 2020 The Oxford Club, LLC All Rights Reserved The Oxford Club | [105 West Monument Street](#) | [Baltimore, MD 21201](#) North America: [1.800.589.3430](#) | International: [+1.443.353.4334](#) | Fax: [1.410.329.1923](#) [Oxfordclub.com]( The Oxford Club is a financial publisher that does not offer any personal financial advice or advocate the purchase or sale of any security or investment for any specific individual. Members should be aware that although our track record is highly rated by an independent analysis and has been legally reviewed, investment markets have inherent risks and there can be no guarantee of future profits. The stated returns may also include option trades. We expressly forbid our writers from having a financial interest in their own securities recommendations to readers. All of our employees and agents must wait 24 hours after online publication or 72 hours after the mailing of printed-only publications prior to following an initial recommendation. Any investments recommended by The Oxford Club should be made only after consulting with your investment advisor and only after reviewing the prospectus or financial statements of the company. Protected by copyright laws of the United States and international treaties. The information found on this website may only be used pursuant to the membership or subscription agreement and any reproduction, copying, or redistribution (electronic or otherwise, including on the world wide web), in whole or in part, is strictly prohibited without the express written permission of The Oxford Club, 105 W. Monument Street, Baltimore MD 21201.