14 November 2019

Fees in an area of Zero Interest Rates

£1,720 smackers for 'advice' - that is 1.72% BEFORE you even make a penny on your £100,000. That is the sad reality in today's Private Banking business. And there is NO GUARANTEE that you will make any money - the fee is payable whether your portfolio has a positive or negative return. Nice money if you can get it! Ask for INDEPENDENT advice before signing on the dotted line!
"Schroders Personal Wealth gave the example of a client with an investment of £100,000 to illustrate the fees. Their total annual costs will be around 137bps (see table below), or 172bps if they use a Discretionary Fund Manager"

5 November 2019

Fund of Funds - nice but how much do they cost?

If they charge a separate fee on top of underlying funds you basically pay two people to do a job that one of them should do. Or let them split the fee, which should not be out of line with the regular fund fee. Take independent advice if you are not sure what level of fee can be justified.
New Fund of Fund launched

14 October 2019

Don't take my free holiday away from me!

That is the cri de coeur that goes out from the pathetic Financial Salesmen (aka Financial Advisers) at the St James Partnership. At least investors know that they are not financing yachts but this still makes crystal clear where their priorities lie. It demonstrates that all investors should take independent advise about fees, charges, risks and performance comparisons before committing any funds to a fund manager or Private Banker.
St James Place Advisers threaten revolt over lost holiday rewards perks

11 October 2019

Should you ever pay an initial fee?

Initial Fees charged by Financial Advisers or other Fund Managers/Private Banks can take a hefty chunk out of you savings. They vary but in some cases or countries they can reach nearly 5 per cent of your capital. In addition you will then be charged an ongoing annual fee by the adviser or the custodian of your investments.
Investors should take independent advice before accepting any terms and conditions. A small one off consulting fee may well save you thousands over a period of time.

5 October 2019

Happy to pay a Wealth Tax - to your Financial Adviser?

This calculator will do the sums for you


20 August 2019

Megatrend Funds - is this a clear strategy?

Bankinter jumps on the "Megatrend" train, launches a fund that seems to be able to invest in a mishmash of asset classes. "Fund invests above 60% in companies without any constraints in terms of market capitalisation, sectors, currencies or geographies.The remaining part of the portfolio will be invested in public and private fixed income instruments.The fund's portfolio could also have exposure to other asset classes or factors including commodities, credit risk, volatility, interest rates, inflation and currencies."
So what is the strategy? And how will the performance be measured as there is no clear benchmark against which such an asset mix can be compared.
Investment Europe

5 August 2019

Questions to ask before you buy any bond

I have a somewhat critical view of rating agencies - they should not be paid by issuers as this could create a conflict of interest. But the regulatory authorities seem to condone this practice.
But if you as a non-professional investor/saver are offered the opportunity to invest in a bond you should ask some basic questions before taking the plunge.
Now with interest rates globally at rock-bottom bonds that offer high interest rates may at first glance look attractive. So ask the following questions:

Who is promoting the bonds? Does the broker/investment bank have skin in the game?
Who is issuing the bonds? Is the issuer guaranteeing the bonds? How long has he been in the business? What is their track record?
If there is collateral or any guarantee - what is behind? Is there a good margin of safety?
What is the maturity of the bond? You may not be able to get your money out before
Especially if there might not be a liquid market in the bonds
Is the bond rated by one of the large rating agencies? As mentioned above, they do have their problems but no rating would be a serious red flag
How high are the fees charged by the issuing/placing agents?
If a Financial Adviser recommends a bond, is he charging a commission from you or the issuer?

Please be aware that this site gives no advice on specific investments but is intended to offer general guidelines for educational purposes. You or your Adviser may have a look at this new offering in order to see how the above suggestions can be applied before you make any investment decision of a similar kind.

A current example of a bond issue would be Urban Exposure Finance Plc 6.50% Secured Notes due 13 August 2026
Urban Exposure launches Sterling Bond

18 July 2019

Fintech Bubblemania is back with a vengeance

Should Joe Public be concerned about these fantasy games that are played with 'valuations'? $3.5 bio for an operation that has a pitiful balance sheet of 150 Mio as per last data I could find. Even if double that it is still ridiculous. And what is the business 'model'? Offering an app and collect deposits? But that is the easy part in banking, if all they then can do is lending it to the wholesale market, mainly other banks, where is the added value? and how much margin is in this 'model'? And the investors that put money into this - and similar start ups - whose money do they look after? It is not their own money but the money that investors - the Joe Public again - have entrusted to them. So any losses are not suffered by the promoters/insiders. The media should be critical and not write adulating reports. And the regulators? Better not say too much, bad for my blood pressure.
On line Bank N26 valued at $3.6 Bio

15 July 2019

Do you know who your ethical fund is backing?

Without specialist help it is easy to fall for catchy advertising. The definition of 'ethical' investing is far from clear and therefore the investment strategies followed by ethical funds are also not necessarily what investors expected.

Should you trust Fund Ratings?

Fund rating firms could be misleading investors by improving the score they give funds in an effort to sell their badge of approval to investment managers. So do not rely blindly on these ratings.

7 April 2019

Get in touch for a free initial consultation - We help you to manage your investment risk, monitor your performance and help you to keep your management fees at an acceptable level. No investment advice on actual investments.
Some of the Problems you may need Help with when investing:
  • Are you suffering from Overconfidence Bias?
  • Performance Fees: Should you pay a fund manager more for doing their job well?

27 March 2019

Expert: Recession is coming - but we don't know when

All too often investors are faced with ambivalent forecasts that are of little use for the management of their portfolios. It is no secret that recessions happen on a regular basis. But when exactly is the next recession going to arrive?
Credit Suisse CIO says a recession is coming