When Your Survival Guy hears “digital advisor,” I run. Vanguard is "allowing" smaller accounts into "Digital Advisor" services. Alex Ortolani reports at Plan Adviser: Vanguard announced Wednesday it will lower the asset minimum for its automatic advisory services to expand access to a broader swath of clients. The asset management giant has lowered the minimum asset requirement to $100 from $3,000 to use Digital Advisor, its automated advisory offering, which provides a broader range of investing glide paths than its target-date funds, along with advice and planning tools. The digital … [Read more...]
Why Vanguard Is Too Big For You
If you want clear evidence of why Vanguard is too big, then look no further than the money flow into passive index funds. When investors are lulled to sleep by a bull market, they dream about things like early retirement, vacations, and second homes. What they tend to miss is that reversion to the mean is a fact of life. You can take my word for it and that of the father of index funds Jack Bogle.
Learn more about why Vanguard is too big for you below:
Have Your Cake and Eat It Too
You may have read my recent series on Vanguard Wellington, and your ability to own the fund at Fidelity. You can have your cake, and eat it too by owning a balanced fund at my favored custodian. If you read the series and enjoyed it, be sure to send this post along to anyone you know who could benefit from it. And if you want to talk more about building a personalized balanced portfolio of stocks, bonds, and precious metals, I'm here. That's the icing on the cake. Your Vanguard Wellington Fund’s Outlook Is your Vanguard Wellington fund’s outlook OK? In a word, yes. But before we get into my … [Read more...]
When You Should Be a Buyer, not a Seller: Part III
Is your Vanguard Wellington fund’s outlook, OK? In a word, yes. But what does that mean for investors in the fund? You know from parts I and II, you can have your cake and eat it too. In other words, you can keep your Wellington and transfer it to Fidelity Investments. But let’s step aside for a moment and consider how investors sell at the worst of times because they can’t handle losing money. When they capitulate and throw in the towel, it’s more about how much money they can’t stand to lose. It has nothing to do with the future. And, of course, history shows these are the times to be … [Read more...]
That ‘70s Show All Over Again?: Part II
You know from my recent piece on Vanguard, I like the outlook for the Vanguard Wellington fund. You can read about that and why I like Fidelity Investments here. Today, you’ll want to draw your attention to the recent mini blip in stocks. Imagine if it lasted decades instead of days. How would you feel if we had a redo of that '70s show? What I want you to focus on today is a performance comparison during the mini blip of Vanguard’s Wellington fund vs. the S&P 500. As you can see in the chart below, Wellington held up nicely. Action Line: You know my concerns about … [Read more...]
Some Housekeeping on Transferring from Vanguard to Fidelity
This morning, Your Survival Guy would like to clarify a few housekeeping items for you regarding transferring your accounts from Vanguard to Fidelity. When you make the transfer, there is no cost, and if you own my favored Wellington and/or Wellesley funds, you simply transfer them over as is or “in-kind.” There’s no cost, and once you’re at Fidelity, you can hold the positions for as long as you want. As an aside, you can read about my client’s relationship with his grandfather and how it was cemented through the Wellington fund. When you decide to become a client of Richard C. Young … [Read more...]
Your Vanguard Wellington Fund’s Outlook: Part I
Is your Vanguard Wellington fund’s outlook OK? In a word, yes. But before we get into my favorite balanced fund, let’s remember it’s not managed by Vanguard. It’s managed by Wellington Management up in Boston, the home base of my favored Johnson family’s Fidelity Investments and the epicenter of old-monied firms like Brown Brothers Harriman. My father-in-law Dick Young would call on Wellington during his days in Boston. And remember, Vanguard founder Jack Bogle was a Wellington Management guy. The money management business has deep Boston roots. As an aside, it’s my belief that Bogle’s … [Read more...]
PART III: Will Criticism Make Vanguard Better?
You know that Your Survival Guy has been honest about his opinion of Vanguard. You can read why in my SPECIAL CONFESSION: Why I’m Being Hard on Vanguard. In a recent interview with ETF.com's Allan Roth, new Vanguard CEO Salim Ramji said that the criticisms the company is receiving will make it better. Your Survival Guy hopes that's true. The reputation of Vanguard's great founder, John Bogle, relies on those who come after him. His legacy should be preserved. Here's the interview between Roth and Ramji: On the one-month anniversary of taking the helm as Vanguard’s new CEO, I conducted a live … [Read more...]
Concerns: Interview with New Vanguard CEO Salim Ramji
You know about my concerns with Vanguard from my SPECIAL REPORT: The Trouble with BlackRo… er… ummm, Vanguard. And I'm not trying to be unfair to Vanguard. But, as I explain in this piece, I have legitimate concerns, and think you should move to Fidelity. Here's what I wrote then: First, the most important reason for moving to Fidelity Investments is because it is still a family run business. It’s run by the founder’s granddaughter, Abigail Johnson. It is not a publicly traded company like BlackRock, pressured to meet Wall Street’s quarterly earnings expectations. Second, now that Vanguard … [Read more...]
PART II: Concerns: Interview with New Vanguard CEO
As I wrote to you here, now that Vanguard and other money managers are charging next to nothing for ETFs and index funds, there is a push for higher fee offerings, such as ESG funds. In an interview with ETF.com's Allan Roth (comments in italics), new Vanguard CEO Salim Ramji (comments in bold), discusses the company's revenue needs: Are systems and customer service related and how will you be addressing these issues? They are related. Modernization started three years ago though perhaps could have started earlier. We are making behind the scenes investments. When completed, this will … [Read more...]
ESG: Underperformance, Higher Fees
You know that Your Survival Guy is not a fan of ESG investing. It seems like a scheme that preyed on investor sympathy and so-called feel-good investing without results while generating higher fees for fund managers. The new fees were the main feature, as most of the funds are slightly altered index funds with pro-ESG weightings that seem to underperform the market. Andy Barr and Jay Clayton explain at The Wall Street Journal: If you invested your 401(k) in an environmental, social and governance fund, chances are your account underperformed. Worse, your investment probably didn’t affect the … [Read more...]
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