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I’ve never understood the Jones bashing that goes on here. It’s a good place for some people. It’s not good for others. It works fine for the way that Spaceman wants to run his business. If it stops being a good place for him, he’ll leave. Jones’ top priority is to make as much money as they can for Jones. This makes them the same as every other B/D.
And this isn't a "How much does the broker love it?" survey its a "how much does the client love it?" survey, and while you can say that the firm stuufs the ballot box in the "greatest place to work in the whole wide world" contest, they can't push the clients to say so.
Percentage on the confirm? That's news to me. yeah, if my clients could see that I'm working for a lower markup than the grocery store, that'd be gooder!
Spiff-
Why do you use only preferred families when you know that your firm discloses the obvious conflict?
Why not work outside of the preferreds just to avoid it? What would be the harm?
Otherwise, I respect your post. Even 6M is a leg up to those of us that started at 0. But I will grant you not much of a help.
[quote=bspears]Whomit, what was Hitler's approval rating in 1939?[/quote]
Godwin's law you lose.
I think you take second place as the fastest Godwinner I ever met (First place guy had written an article and Godwinned himself before the forum thread even started, so he'll be tuff to beat.)
foot - I know I got a little bit of a headstart with the $6 mil. But in STL it is very rare to start with $0. I'm pissed that the lady that started a month after me got a $20 mil office. Had I just procrastinated a little longer.
I use the preferred fund families because they are good families. I use mainly American, Franklin, and Goldman. American because...well, they're American. I use Franklin because they have a better product mix than American, but a similar philosophy and management style. I like Goldman because people recognize the name and they have great performance since they cleaned house a few years ago. I'd love to use D&C, but they've closed most of their funds. And I'd be worried about what happens when the old guys die. I've looked at MFS, Columbia, Pioneer, Calamos, AIM, Alliance Bernstein, and a few others. All of them have their merits, but not enough for me to do a wholesale change in what I'm doing now. I found something that works for me and my clients. Yes, it was because they are Jones preferred funds. I would expect if Jones ever launces a fee based platform with any sort of autonomy I'll look at other families. But for now, I'm happy with the ones we use.
I don't think the conflict of interest is incredibly important to clients. That doesn't mean I think they don't need to know about it, I just don't think they look at it as much as the industry does. It's important to brokers when trying to convince a prospect that the local Jones guy is not working in their best interest because of the conflict. But at the end of the day as long as we're hitting the returns they want, clients are happy, conflict or not.
Spiff-
I like the dialogue. Let's keep going. What about ETF's or UIT's to fit your style boxes? Have you considered them as an options to funds? What about those clients that would prefer NOT to have to pay taxes on their non-retirement assets? Do you still employ the 3 fund families for that strategy?
Capital gains is part of the story. What about trading costs? What are your answers to these issues?
I'm starting to use more ETFs for satellite type investments. I've looked at both iShares and Powershares. If someone else has another family they use I'd love to hear it.
I've used UITs sporadically. It's Jones, so the UITs I have access to are pretty sparse.
The tax issues with funds are something I do discuss with clients. We talk about annuities and individual stocks/bonds as alternatives. I don't get a lot of those kind of accounts. Most of the money I deal with is IRA money. I've never actually looked into the percentage, but I'd guess 75-80%.
By trading costs I assume you're talking about internal trading costs on mutual funds. I don't talk about them. Kind of like the conflict of interest conversation we had before, I don't think the clients are overly concerned about them. I only hear that discussion from brokers trying to convince their clients that they are controlling the costs by buying stocks or UITs or ETFs. Or from the people that believe that indexing is the only way to invest. More power to them. When the day comes that a client or a prospect asks me a question about them, I'll answer it. I'm not trying to avoid it. It's just a non-issue for my clients.
Spiff-
Look up the term fiduciary. If you were one or acting as one, you would or should be concerned about all costs affecting your clients portfolios. Even ones you don't talk about.
If you know about them and don't reveal them aren't you acting in an unethical manner?
[quote=footsoldier]
Spiff-
Look up the term fiduciary. If you were one or acting as one, you would or should be concerned about all costs affecting your clients portfolios. Even ones you don't talk about.
If you know about them and don't reveal them aren't you acting in an unethical manner?
[/quote]
Does your doctor explain every single detail when they're treating you?
Are they unethical if they don't?
I was unaware. My firm does not require me to disclose internal trading costs. As long as my clients' statements are showing that our strategies are doing what they're supposed to, who really gives a rip?
In other words, I don't ask the doctor how much of the cost of my perscription was the direct result of the idiot at the end of the line who couldn't get the lables on the bottles put on straight. I ask him if he can cure me, if the drug he's giving me will work, and what the next step is.
You can't be a fiduciary. Not if you consider knowing all pertinent facts about an investment, and choose not to disclose. Your analogy doesn't work.
It might help you feel better, but it doesn't pass the smell test.
Footsoldier, a fiduciary does not have the duty to disclose all expenses. The client doesn't need to know all internal expenses of an investment, nor do they care. Footsoldier, you can't disclose the trading costs because you don't know what they are. They can be estimated by third parties, but there is no guarantee that the information is accurate.
It goes back to the old saying that when someone asks the time, they don't want to know how the clock works.
[quote=joedabrkr] [quote=Whomitmayconcer]
[quote=bspears]Whomit, what was Hitler's approval rating in 1939?[/quote]
Godwin's law you lose.
I think you take second place as the fastest Godwinner I ever met (First place guy had written an article and Godwinned himself before the forum thread even started, so he'll be tuff to beat.)
[/quote]
I think Godwin's law is completely gay....
[/quote]
funny Joe, but I think it's interesting that someone even comes up with this stuff.
http://en.wikipedia.org/wiki/Godwin%27s_law
[quote=footsoldier]
You can't be a fiduciary. Not if you consider knowing all pertinent facts about an investment, and choose not to disclose. Your analogy doesn't work.
It might help you feel better, but it doesn't pass the smell test.
[/quote]
I agree that I'm not a fiduciary. Never said I was one or was trying to be one. It' not a word I use with my clients. I'm a Financial Advisor. I get paid to tell them what to do with their money. I make money doing that. If you want to play a semantics game, I might interpret a role as a fiduciary as one who gives advice, but does not financially gain from said advice. So, maybe you can't be one either.
I think you're splitting hairs with the internal trading costs issue. Personalfund.com is the only place I ever seen that will break down out the internal trading costs on a fund. They're not using factual data from the fund companies. They're using averages. So, the difference in transaction costs at a large company like American Funds and some of the smaller ones would be vastly different, but they're lumping them all together for the calculations. I'm not saying the costs aren't there, but to actually quantify them would be next to impossible. I think it's interesting that the difference between the transactional cost avg on a Large Cap fund vs the index is only 5 bps.
Also, in the prospectus for CWGIX (and I would therefore assume all other funds too) there is a footnote that says "includes custodial, legal, transfer agent and substransfer agent/recordkeeping payments and various other expenses." Maybe the "other expenses" includes their transaction costs.
Like I said before. The only brokers who use transactional costs are the ones trying to convince someone that they're stock or ETF portfolio is far and away better than a typical mutual fund portfolio.
Spiff-
Who do you think did most of AF transactions (filling EDJ fund orders) before the SEC banned directed brokerage? Yep. Every step of the way Jones was in bed with AF.
For years Bachman and Hill preached , "There is only one revenue source." The IR (now FA). BS. And you fell for it hook line and sinker.
My way may or may not be better than yours. But its a helluva lot cleaner. I think the time has come for you to educate yourself about options your clients have. Checkout dfaus.com and if you have time between doorknocks read the white papers about costs of funds, and active vs passive management.
Oh yeah, the next time you have lunch with an attorney don't forget to mention that your firm discloses all conflicts of interest, just doesn't change any of its business practices. Your own trust company, (unless they have changed recently) who is a fiduciary, buys only preferred funds and accepts kickbacks!
Ignore it, Spiff. Another "holier than thou" pundit attempting to pick a fight.
Meanwhile, the local TV store can sell whatever brand of TVs it wants. Same with the shoe store, or any store. But the broker/dealer store is a charlatan if it decides it likes to sell certain brands over others.
When is the SEC just going to make all our jobs obsolete, and make everyone invest in I, F, C, S, or Lifecycle, managed by Barclays(R) ?
Freedom of choice helps to make my country great. Loudmouth sanctimonious soapboxers doesn't.