Jump to content
Sign in to follow this  
tony

Investors Are Usually Wrong..I'm one of them

Recommended Posts

"Forget about getting everything right. Most people are so consistently wrong that merely avoiding major errors is enough to set you apart from the pack.That is the message in the latest data from Dalbar, a Massachusetts research firm that has been studying the behavior of mutual fund investors for 25 years".

I found it interesting that he stated annuities because of surrender charges helps an investor stay put and may help him/her do better long term...interesting, I never thought of surrender charges being an advantage.

https://www.nytimes.com/2019/07/26/your-money/stock-bond-investing.html?rref=collection%2Ftimestopic%2FMutual Funds&action=click&contentCollection=timestopics&region=&module=stream_unit&version=latest&contentPlacement=1&pgtype=collection

Share this post


Link to post
Share on other sites

I've never heard the author's claim before, about surrender charges improving performance by essentially protecting investors from making behavioral mistakes.  I suppose that could be true in some cases, but it seems like twisted logic to me.  It's kind of like a kidnapper saying he is protecting his hostage, because the victim is less likely to be in an auto accident or struck by lightning, etc. if they are chained up in my basement. 😆

Share this post


Link to post
Share on other sites
3 hours ago, MNGopher said:

It's kind of like a kidnapper saying he is protecting his hostage, because the victim is less likely to be in an auto accident or struck by lightning, etc. if they are chained up in my basement. 😆

that's a funny analogy MN Gopher!!

Share this post


Link to post
Share on other sites

Never heard of "advantages" of annuities claimed by the sales force? My goodness, you need to listen to the agents.

The agents are very good at telling those horror stories about the big bad stock market and how you can lose all of your money overnight! So, an annuity protects your assets because you never lose money in a down market, NEVER! (they never mention that insurance companies can go bankrupt too and the fact that the returns in an annuity are so pathetic that they never will keep up with the pace of inflation. SOOO, you lose money to inflation and taxes over time). 

Another advantage claimed by the sales force is that the agent will hold your hand throughout (they fail to mention that once the ink is dry by the teacher's signature on that terrible contract, the salesperson is gone!)

And lastly, the insurance guarantees that you will get your principal back. WOW! Isn't that neat? The agent doesn't tell you that this is rarely if ever used. Yet those absolutely hideous and completely useless M&E charges are up to 1.25% year after year on top of the other expenses. 

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Loading...
Sign in to follow this  

×
×
  • Create New...