advice for me…

[socalarm]

Hi, I credit piggington for helping me learn about the housing market. I sold my house in LA in ’06, and have been a happy renter since. I have however made one ‘error’ since. Till June this year, I’d parked my cash with ING and didn’t want to touch any risky investments until the outlook became clearer. By June however, I succumbed to the notion that the market wasn’t tumbling quite yet. Through a financial advisor at Morgan Stanley I invested in a combination of equity and bond funds. I know it’s only been 6 months, but so far I’m down 5% (and dwindling steadily). When I mentioned I wanted to be very conservative, he recommended I diversify into currency funds as well. My portfolio now stands at about 40% equity funds, 40% bond funds, 20% currency funds. I’m definitely not an expert and I don’t want to tell him how to do his job, but I’m quite stressed about the whole idea now. I don’t need this money for income but I also don’t want to watch my savings dwindle. Thanks in advance !

[stansd]

That doesn’t strike me as a conservative portfolio. Depending on how soon you think you may need the money, 40% equity may be aggressive. The mix of the bond fund is also important as well. If it’s longer term maturities (look at the duration of the fund-if it’s more than a couple years, it’s fairly risky for someone that may need the dough soon), or a fund that invests in anything except T-bills, you may have risk there.

The currency fund may not be a terrible idea if it’s a bet against the dollar (the assumption being if the dollar does well, your other funds will do well also, but if the dollar does poorly, your equities are likely to do poorly so you are a bit more hedged). That said, I have trouble seeing a conservative portfolio that includes a currency fund.

Is your advisor earning any fees on these funds (look for the front or back end load and the expense ratio)? If any of those are more than 1%, you’ve been taken for a ride in my mind.

Hard to say without more info, but the early indicators aren’t good to me that you have been given good advice.

Stan

[stansd]

That doesn’t strike me as a conservative portfolio. Depending on how soon you think you may need the money, 40% equity may be aggressive. The mix of the bond fund is also important as well. If it’s longer term maturities (look at the duration of the fund-if it’s more than a couple years, it’s fairly risky for someone that may need the dough soon), or a fund that invests in anything except T-bills, you may have risk there.

The currency fund may not be a terrible idea if it’s a bet against the dollar (the assumption being if the dollar does well, your other funds will do well also, but if the dollar does poorly, your equities are likely to do poorly so you are a bit more hedged). That said, I have trouble seeing a conservative portfolio that includes a currency fund.

Is your advisor earning any fees on these funds (look for the front or back end load and the expense ratio)? If any of those are more than 1%, you’ve been taken for a ride in my mind.

Hard to say without more info, but the early indicators aren’t good to me that you have been given good advice.

Stan

[stansd]

That doesn’t strike me as a conservative portfolio. Depending on how soon you think you may need the money, 40% equity may be aggressive. The mix of the bond fund is also important as well. If it’s longer term maturities (look at the duration of the fund-if it’s more than a couple years, it’s fairly risky for someone that may need the dough soon), or a fund that invests in anything except T-bills, you may have risk there.

The currency fund may not be a terrible idea if it’s a bet against the dollar (the assumption being if the dollar does well, your other funds will do well also, but if the dollar does poorly, your equities are likely to do poorly so you are a bit more hedged). That said, I have trouble seeing a conservative portfolio that includes a currency fund.

Is your advisor earning any fees on these funds (look for the front or back end load and the expense ratio)? If any of those are more than 1%, you’ve been taken for a ride in my mind.

Hard to say without more info, but the early indicators aren’t good to me that you have been given good advice.

Stan

[stansd]

That doesn’t strike me as a conservative portfolio. Depending on how soon you think you may need the money, 40% equity may be aggressive. The mix of the bond fund is also important as well. If it’s longer term maturities (look at the duration of the fund-if it’s more than a couple years, it’s fairly risky for someone that may need the dough soon), or a fund that invests in anything except T-bills, you may have risk there.

The currency fund may not be a terrible idea if it’s a bet against the dollar (the assumption being if the dollar does well, your other funds will do well also, but if the dollar does poorly, your equities are likely to do poorly so you are a bit more hedged). That said, I have trouble seeing a conservative portfolio that includes a currency fund.

Is your advisor earning any fees on these funds (look for the front or back end load and the expense ratio)? If any of those are more than 1%, you’ve been taken for a ride in my mind.

Hard to say without more info, but the early indicators aren’t good to me that you have been given good advice.

Stan

[stansd]

That doesn’t strike me as a conservative portfolio. Depending on how soon you think you may need the money, 40% equity may be aggressive. The mix of the bond fund is also important as well. If it’s longer term maturities (look at the duration of the fund-if it’s more than a couple years, it’s fairly risky for someone that may need the dough soon), or a fund that invests in anything except T-bills, you may have risk there.

The currency fund may not be a terrible idea if it’s a bet against the dollar (the assumption being if the dollar does well, your other funds will do well also, but if the dollar does poorly, your equities are likely to do poorly so you are a bit more hedged). That said, I have trouble seeing a conservative portfolio that includes a currency fund.

Is your advisor earning any fees on these funds (look for the front or back end load and the expense ratio)? If any of those are more than 1%, you’ve been taken for a ride in my mind.

Hard to say without more info, but the early indicators aren’t good to me that you have been given good advice.

Stan

[mrwrong]

I’m not qualified to give financial advice, but if you trust your financial advisor, I will suggest you to talk to this guy about exactly what you are uneasy about your portfolio and see if he can do anything to make you comfortable again. Investment involves risks and everyone’s risk tolerance is different. It is important that your asset allocation reflects that.

Mr. Wrong

[mrwrong]

I’m not qualified to give financial advice, but if you trust your financial advisor, I will suggest you to talk to this guy about exactly what you are uneasy about your portfolio and see if he can do anything to make you comfortable again. Investment involves risks and everyone’s risk tolerance is different. It is important that your asset allocation reflects that.

Mr. Wrong

[mrwrong]

I’m not qualified to give financial advice, but if you trust your financial advisor, I will suggest you to talk to this guy about exactly what you are uneasy about your portfolio and see if he can do anything to make you comfortable again. Investment involves risks and everyone’s risk tolerance is different. It is important that your asset allocation reflects that.

Mr. Wrong

[mrwrong]

I’m not qualified to give financial advice, but if you trust your financial advisor, I will suggest you to talk to this guy about exactly what you are uneasy about your portfolio and see if he can do anything to make you comfortable again. Investment involves risks and everyone’s risk tolerance is different. It is important that your asset allocation reflects that.

Mr. Wrong

[mrwrong]

I’m not qualified to give financial advice, but if you trust your financial advisor, I will suggest you to talk to this guy about exactly what you are uneasy about your portfolio and see if he can do anything to make you comfortable again. Investment involves risks and everyone’s risk tolerance is different. It is important that your asset allocation reflects that.

Mr. Wrong

[XBoxBoy]

If you want to be conservative, you might put your money in short term treasuries. They don’t pay much, but you don’t need to worry about losing any of your capital. (Although like all dollar investments, you could lose purchasing power as the dollar declines in value) One nice thing is you can do this through Treasury Direct, and not pay any broker fees whatsoever.

Advantages: Investment is fully backed by the USA government. Never loses any capital, no broker fees to deal with.

Disadvantages: Doesn’t pay that great a return. But hey, you don’t risk much, you can’t really expect a lot of upside.

XBoxBoy

[XBoxBoy]

If you want to be conservative, you might put your money in short term treasuries. They don’t pay much, but you don’t need to worry about losing any of your capital. (Although like all dollar investments, you could lose purchasing power as the dollar declines in value) One nice thing is you can do this through Treasury Direct, and not pay any broker fees whatsoever.

Advantages: Investment is fully backed by the USA government. Never loses any capital, no broker fees to deal with.

Disadvantages: Doesn’t pay that great a return. But hey, you don’t risk much, you can’t really expect a lot of upside.

XBoxBoy

[XBoxBoy]

If you want to be conservative, you might put your money in short term treasuries. They don’t pay much, but you don’t need to worry about losing any of your capital. (Although like all dollar investments, you could lose purchasing power as the dollar declines in value) One nice thing is you can do this through Treasury Direct, and not pay any broker fees whatsoever.

Advantages: Investment is fully backed by the USA government. Never loses any capital, no broker fees to deal with.

Disadvantages: Doesn’t pay that great a return. But hey, you don’t risk much, you can’t really expect a lot of upside.

XBoxBoy

[XBoxBoy]

If you want to be conservative, you might put your money in short term treasuries. They don’t pay much, but you don’t need to worry about losing any of your capital. (Although like all dollar investments, you could lose purchasing power as the dollar declines in value) One nice thing is you can do this through Treasury Direct, and not pay any broker fees whatsoever.

Advantages: Investment is fully backed by the USA government. Never loses any capital, no broker fees to deal with.

Disadvantages: Doesn’t pay that great a return. But hey, you don’t risk much, you can’t really expect a lot of upside.

XBoxBoy

[Author]

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