npalen
Elite Member
How do most mutual funds react to a downturn or impending downturn in the stock market? Do they tend to sell in a downturn or hang tight knowing that the market always comes back eventually?
How do most mutual funds react to a downturn or impending downturn in the stock market? Do they tend to sell in a downturn or hang tight knowing that the market always comes back eventually?
Independent financial advisors, any size, any place, are expensive. Most, not all, have their fees deducted directly from your capital, so it is difficult to determine your cost for their advice. Advisors are paid with your money, from your accounts, in up markets and down markets.
I have a T. Rowe Price annual report before me. For the X X X X X FUND, annual direct investment expense ratio is 0.64% per year.
X X X X X FUND - ADVISOR CLASS annual investment expense ratio with an intermediary independent financial advisor is 0.91% per year.
Assuming the long term growth rate for stocks will be 4% over inflation, a nearly 1% annual fee is a killer. Deal direct.
During my final fourteen working years my employer paid 100% of the 401(k) fund expenses, in addition to making a 3% match on 6% contributions, so on the funds within the 401(k) the employee expense ratio was not 0.91% not 0.64% but 0.00%. Not all employers are so generous.
I think a good way to get started is to find a local financial advisor. Personally, it would drive me insane to attempt to make investment decisions on my own. There are about a billion different options with different strategies, goals, and risks.
A good advisor would start by assessing your current state, goals, risk tolerance, etc..
Can anyone recommend the best way to start investing for beginners? For example, opening an account with TD Ameritrade or Fidelity? Broad topic I know, just would like someplace to start. Thanks!
Be cautious when looking for your "financial advisor" ... a great many of them are unqualified at best.
How do most mutual funds react to a downturn or impending downturn in the stock market? Do they tend to sell in a downturn or hang tight knowing that the market always comes back eventually?