In my conversations with you, we talk about the virtues of being a balanced investor. You can achieve this through a mix of blue-chip dividend payers and laddered bonds. To illustrate, I’ll use as a proxy Fidelity Balanced, Vanguard Wellington, and Vanguard Wellesley funds. In that order, they have roughly the following stock/bond allocation mix: 70/30, 60/40, or 40/60. (Note: Wellington and Wellesley are managed by Wellington Management in Boston, MA, not the Vanguard Group.) For more, read the P.S. below. With the Federal Reserve deciding to hold rates steady yesterday—they’ve made … [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:
BlackRock and Vanguard: Controlling Interest
"Who owns the world?" asks Dr. Joseph Mercola on his blog, Mercola.com. You can find all over the internet that BlackRock and Vanguard own nearly everything, with major percentages of many public corporations listed as being owned by the two money managers and, to a lesser degree State Street. To an extent, these assertions are correct. Ownership of shares in those companies are registered to accounts maintained by BlackRock or Vanguard. But the investors who own the accounts are the true owners of the shares. The question is, who is in control? Mutual fund and ETF shareholders give up their … [Read more...]
Vanguard Does a U-Turn on Investor Activism
After receiving pressure from investors and others, Vanguard has announced that it will withdraw from the Net Zero Asset Managers (NZAM) initiative. Brittany Bernstein reports in National Review: Vanguard announced Wednesday it is pulling out of the Net Zero Asset Managers initiative, an investment-industry effort to encourage fund firms to reach net zero emission targets by 2050. “We have decided to withdraw from NZAM so that we can provide the clarity our investors desire about the role of index funds and about how we think about material risks, including climate-related risks—and to … [Read more...]
All-Powerful Money Managers Voting YOUR Money Targeted by Senate GOP
You and Your Survival Guy have been watching the problems with ESG funds and all-powerful money managers voting your shares for years now. Finally, someone in Washington, DC, is realizing how bad this is for America. Senator Dan Sullivan of Alaska plans to introduce legislation that will force money managers to allow investors to vote their own shares. The Wall Street Journal’s Angel Au-Yeung reports: A group of Republican senators is looking to curtail the power big asset managers like BlackRock Inc. and Vanguard Group have over public companies. In legislation to be introduced Wednesday, … [Read more...]
Can We Still Afford the Riverboat Cruise?
Are you falling for the oldest trick in the book? Here’s how it reads. Managers today draw you in with low-cost index funds and past performance—not necessarily in that order. Then, once you’re in the door, they sell you on other stuff, like toxic variable annuities, until you’re blue in the face. It’s hard not to fall for the sales pitch. I get it. Here’s what happens. It’s Sunday morning. You don’t have a care in the world. Frank Sinatra is playing in the background. Life is good. Then you peel open the quarterly funds report in the Journal and look at the performance like a box score … [Read more...]
Bogle Warned: 800 lb. Gorillas & Greener Pastures
UPDATE: The numbers are in. BlackRock is pushing around boardrooms to focus on everything BUT profits and shareholder return. Politico reports: At companies across the globe, BlackRock supported 64 percent of environmental proposals and about a third of social and governance resolutions put forth by shareholders in a year when workforce diversity and climate risk rose to the top of investor concerns. With $9 trillion in assets under management and ownership of more than 7 percent of shares on the S&P 500, BlackRock voted against corporate management at 42 percent of shareholder … [Read more...]
Sell in May?/911 Emergencies/Fidelity #1/Cryptos/Stocks
Who's got your back in the world of finance when the going gets tough? And some other thoughts. When Georgia changed its voting laws, and over 100 CEOs and business leaders signed a letter in protest, did they even read the law? File this under my "You Invest, They Win." Are you surprised to see BlackRock CEO Larry Fink or Vanguard? You can check out the list below. Sell in May go away? Has there been a better time to be a seller of real estate? 2006 comes to mind. If you're a buyer, stay off the beaten path. Here's Your Survival Guy's tip of the day. Keep a chunk of your stock … [Read more...]
Timeless Wisdom from Vanguard Founder Jack Bogle
With few guarantees in the investment world, here’s one: Avoid companies growing their client base through acquisitions. It’s happening all the time, thanks to consolidation within the industry. But bigger isn’t better, especially when it comes to knowing your customers. Legendary investor and Vanguard founder Jack Bogle spoke about this when he was alive, and I’ve never forgotten it. What Bogle was referring to was the relationship between an investor and an advisor. But that sacred bond was muddled when a bigger company acquired a smaller one simply by writing a big check. Bogle understood … [Read more...]
Why Service Is King in 1(800)# Teenage Wasteland
Service is King, even today when many financial firms treat it like the Joker. Try getting a copy of your 1099, or figuring out a K-1. What you’re faced with is, perhaps, hours in a phone queue maze with no satisfactory answer. Some of these firms, not Fidelity, are too big and end up failing simple tasks. Other’s are left offering funds that are too big (like some of Vanguard’s) and then fail to meet the needs of investors (such as ESG funds from BlackRock and others) while trying to save the world. All you want is what you asked for, is that so hard? For some, in a word, yes. Action Line: … [Read more...]
Fidelity’s 26 Million Retail Accounts in 2020, Up 17%
Yours truly can attest to Fidelity’s banner year, as business is booming in my neck of the woods. Never before have I opened more accounts for existing and new customers. Who would have thought this would EVER happen in a pandemic year? I certainly did NOT. But as I’ve written to you before, when it comes to investing, you don’t want to be in the PREDICTION business. It never hurts to have a front-row seat, though. “Fidelity’s Retail Investor Accounts Rise 17% to 26 million” reports the WSJ here: Fidelity Investments capped 2020 with record annual operating profit, lifted by strong … [Read more...]
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