9 January 2017

High Fees? Hedge Funds not the only suspects!

Many comments are made about high fees charged by Hedge Funds. But before you jump ship you should keep in mind that Private Equity or Traditional Funds are not necessarily cheaper. The Hedge Fund concept per se does not mean that the 2+20 fee structure is set in stone. It is a choice that the providers give the investor and you are free to shop around.
But Private Equity Funds are also charging a not inconsiderable management fee and take a cut from the fund's performance. And when you invest via a Private Bank or Financial Adviser you quite often are paying a fee to them as well as a fee for the underlying investment vehicles they allocate your investment monies to.
You need to take special care and advice when awarding a management mandate to any Wealth Manager and get a clear analysis of the impact of fees on future performance!

https://www.bloomberg.com/news/videos/2017-01-04/why-asia-s-richest-families-are-dumping-hedge-funds (Bloomberg)

Should you let Friends manage your Portfolio?

It may be tempting to let a friend manage your portfolio. He or She may be more familiar with the world of money, - or at least give that impression. You may save on fees and prefer to interact with someone you think you know well.
But watch out! Is your friend really running his own - let alone somone else's - money well? How is the track record, especially in turbulent markets, and when a stomach-churning downturn occurs, such as we have seen in 2008-09?
You have little protection if something goes wrong either due to mismanagement or even worse - fraud. It has happened before many times and given human nature it will happen again.

http://www.telegraph.co.uk/investing/funds/could-fund-manager-next-door/ (Daily Telegraph)

Is Stock Picking the right Strategy for You?

Everyone loves to be able to pick the next IBM, Apple or Facebook but it is difficult even for the Professionals to pick the right stock!

2016 was a terrible year for stock picking, and 2017 may not get much better (CNBC) 

7 January 2017

Index ETF: Time to say Good Bye?

More and more commentators suggest that investors should move out of passive investment vehicles, i.e. index funds, mostly packaged as ETF's. But you should resist the lure of active mnagement and instead review your asset Aalocation.

6 January 2017

Know your Fund Manager

An important - and often overlooked - aspect of selecting a fund manager or financial advisers: what is his PERSONAL track record? Who is actually managing the fund (is it a team or is one person responsible for the performance)? Is the fund manager focused on only one fund or does he have a number of funds to look after? Achieving good performance is difficult enough but the additional task of deciding which fund should benefit from the best ideas is nearly insurmountable. Naturally, fund managers and their employees are more interested in boosting the number of assets under management, and their profits/compensation, rather then just achieving best possible performance.

26 December 2016

Target Date Funds - spot the Target!

It may well be your pocket that is the target. The concept of Target Date Funds may be plausible but in practive they may well be (1) more expensive than necessary to achieve their stated aim and (2) more a clever marketing concept than a proven investment strategy.

1 December 2016

Gold is the ultimate protection

Governments are waging a silent war against Cash. They don't do it openly but sail in the tailwinds of Financial Technology Companies, including Credit Card providers and Banks that do the dirty work for them. Cashless societies open the door to total control of all activities and by implication also total control of the citizens, or maybe one should call them worker ants that are only allowed to finance the more and more absurd spending perpetrated by the Polit-Establisment. Gold is even more unpopular in that Nomenklatura and it is no wonder that there are persistent efforts to make it difficult to buy and hold gold.
Given that it is the ultimate insurance policy against total state control of your wealth careful planning is imperative when purchasing and storing gold.

Sad end to Swiss Bank Secrecy

Switzerland has been created as the result of a tax revolt against its Hapsburg (Austrian) overseers. So it is sad that a proud nation abases itself to become what can only be seen as a tax collector for the USA. Different nation states with different laws and customs were the main factor behind the fantastic cultural and economic development of Europe - in stark contrast to the unitary state of China.Nevermin d that bank secrecy helped any number of persecuted people to escape from Nazi Dictatorship with their lives and the means to start a new life elsewhere!

Credit Suisse said to freeze accounts in search for U.S. assets

Do you know your Asset Allocation?

While picking individual stocks, currencies, bonds or even countries and sectors may be sexy most investors do not know that the decision about asset allocation (stocks/bonds/currencies/real assets) is the most important factor in achieving long-term investment success. Depending on your personal situation this holistic approach should also include real estate and interests in business, either directly or indirectly held.

31 October 2016

It all comes down to style in Managed Futures (HedgeWeek)