Quote:
Originally Posted by Enoch Root
Are you saying you want those services but not the portfolio management?
I see where you're going, but I don't agree. While it is very difficult to 'cover' the fees from good portfolio management alone, the fact remains that professionals are going to (or should) do a better job of it than a non-professional. They have more tools at their disposal.
But more importantly, it is the combination of all of it together that makes sense. The portfolio should be managed in a way that is complimentary to, and consistent with, the wealth management strategies and goals.
Also, if you separate them, people won't pay for wealth management until they think they need it, which is usually too late.
The best approach is a consistent plan that remains on track over the long term. The best way to achieve that is a fully bundled set of services.
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Yes, I'd potentially like a one-stop shop for those services but still manage my own money.
I do an objectively good job managing my own money (significant outperformance over a full cycle, including great Sharpe ratio and even better Sortino ratio). But I do that using strategies that I wouldn't get at basically any portfolio manager.
For example odd lot tenders. I made over $5k on the E-L Financial odd lot tender. But that is the maximum dollar amount possible. Funds wouldn't bother because it isn't meaningful, but $5k is still meaningful to me. A few low risk deals like that a year adds significant performance but minimal risk.
I also do things that are liquidity constrained. For example I bought Calfrac unsecured debt prior to their recent recapitalization. That worked out to buying the new CFW shares at just over $2, and a couple weeks after the restructuring they are over $4. This was more risky than an odd lot, but the implied valuation was absurd. But there was barely any liquidity. I doubled my money here, but again the time vs money wouldn't have been worth it for a fund or manager.
I do feel like I'm missing some integration though. For example, I do donations every year. I'd almost certainly be better off donating a security with a huge gain, but I tend to have my long term winners in my registered accounts, and my non-reg is full of short term stuff that doesn't work well for that. I'd like to generate offsetting gains and losses so I could donate the winner and claim the capital loss on the loser. I'm thinking narrow option spreads here, or maybe going long inverse funds. But it would be nice to have someone to kick around ideas like that with.
Anyway, maybe that isn't a common set of complaints. I'm sure all the advisors in this thread are adding value through both portfolio management and other advice, I just have a bit of a different perspective.