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Using 3rd Party money managers so we can be FA's

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Jul 25, 2010 7:43 pm

What is your opinion of 3rd party money managers like Curian who seem to be able to provide "Institutional Returns" and have world class resources like Ned Davis and Rodgerscasy. 

My point is a real FA should be in front of clients and prospects to help them listening to them and developing a strategy to define and focus them on their goals. EH?

Jul 27, 2010 2:25 pm

Curian is just like all of the other firms SEI included. Lead Dog my advice would be to go to Dorsey Wright and Associates take a three week trial and explore the opportunities in Point and Figure Charting. Put together your own process and your own philosophy, disciplines and tactics.

Successful investing is counterintuitive.

Rule #1 Don’t Lose.

Investing is truly not a business off hitting grand slam home runs. It is a business of avoiding substantial reductions in capital.

The financial services industry has always looked at investing as we can pick ‘em better than they can pick ‘em.

Our performance is better than theirs. When in fact what the last decade has demonstrated very clearly is you can be right for several years and if you are wrong on one of the disastrous occasions. You have wiped out all of the value that was created.

Success in investing is counterintuitive.

Think for a moment about hitting a golf ball. The number one problem with any golfer's swing is that they try to swing too hard. When I’m out to produce a result that’s both far-reaching and accurate in aim, my first inclination is to grip the club tightly, wind-up and swing with as much force as possible.

Ironically, this almost never produces the intended result. When I relax, limit the height of my back swing, and allow the club head to fall naturally in a gentle and controlled arc toward the ball, I get better distance and accuracy than I can imagine or understand. It is counterintuitive.

Successful investing is the reverse of how most of us are stimulated by advisors and firms. Investment firms are always coming up with their lists of investments that will double or triple in value over a relatively short period of time.

Wealth can create complexity, but wealth doesn’t need to be managed in a complex fashion. The recipe for preserving and building wealth is the same as it was 50 years ago.

You need to align your portfolio to what Albert Einstein referred to as one of the mathematical mysteries of the universe.

Albert Einstein was a pretty fair mathematician.

The mystery to which Albert Einstein was referring was the power of compounding.

The only thing that destroys the power of compounding is the loss of principal.

It would serve you well to have in place a discipline to recognize and trigger action at “unacceptable levels” of capital loss.

Rule #2 Take Losses

You may be thinking, “Wait a minute Roger, first you say don’t lose, now you are saying take losses.”


I will be wrong.

We live in a world of probabilities and possibilities.

That is the way it is.

Unsuccessful advisors assume they will never be wrong.

Successful advisors understand that they will be wrong.

Good luck!!!!!!!!!!!!

Jul 27, 2010 7:56 pm


Thanks, I'll take a look.

I talked to a former Bloomberg analysist last week, he was a big fan of managing Beta


Aug 6, 2010 1:50 pm


My point is a real FA should be in front of clients and prospects to help them listening to them and developing a strategy to define and focus them on their goals. EH?


I think you'll find that this may not be the definition may FA's have of their duties. While I wouldn't disagree on knowing your client and listening to them. I got into this business to invest for them not to just gather assets.

I won't comment on the company you mentioned as I don't have enough to base any comment on. But, don't put too much creedence on what these 3rd party guys do. I only say this because I know a few who do this and seeing behind the scenes in some of these operations reaffrims my belief that I am doing the right thing.

Sure it takes more time, but the rewards are gratifying and you know why your client is where they are. Pros, Cons go on and on...

Aug 6, 2010 1:57 pm

I agree with Jack.  If you are going to outsource investments, you have to make sure they are good, and that you really believe in their process.  And know what is going to happen in the event of a 2008 Redux (i.e. how do they react).

Aug 6, 2010 2:49 pm

Dog - I think it depends on how you want your office to run.  At some point you have to choose if you are going to be a planner who spends his day running retirement planning reports, monte carlo analysis, and estate planning calculations or if you are going to be a money manager who researches, trades, and makes strategic moves based on market conditions.  I personally don't think one person can do both well.  Not with a large client base anyway.  If you've got 50 clients with $2mil each, then it might be something you can accomplish.  Beyond that, it gets dicey as to whether you can pull it off or not. 

You've got to decide how you want to spend your day.   

Aug 8, 2010 3:45 am

All Good points!

since i have posted that Question I have Joined  firm that has a fab team of people that monitors the market and performs trades, developes plans, etc. It is a good fit for me. I don't regret trying to do it all...i learned tons.

Jack, you speak to what are your interests. Spaceman, finding your juice is not easy but, certianly not impossible. I wish to have access to a network that can provide it all. I believe the future of our professon is still being defined. Our job is to be a great Quaterback.  I am the quarterback  is to give them the best investment/retirement soloution and investment advice available. That entails that I focus on what is best for them. Having confidence that the resources available to make that happen has been



Aug 9, 2010 12:54 pm

Well put LDM...