Online or Managed Investing?

16 Dec Online or Managed Investing?

Last month, I had an opportunity to be interviewed for a story that was published in the December 7th issue of Macleans magazine. The story was about whether people should delegate their investments to a qualified investment professional OR take control of their investments themselves and do it on their own.  If you were to ask me, my opinion would be biased considering that I’ve been managing my own money for the past 14 years. However, for those who aren’t sure at this point, let me outline the benefits of both.

Benefits of finding a qualified and successful investment professional

You can see that I underlined the word “successful”. There are too many investment advisors out there who are advising people what to do with their own money but yet, they are not successful themselves. These people are merely salespeople who are pushing investment products so they can make a commission. However, if you’re able to find someone who’s been very successful and  you agree with his investment philosophy, it could be a very good fit. The reason being that you can leverage his/her experiences, knowledge and expertise which could take you many years to attain. The rationale is why try to be an expert in investing when you can hire an expert to handle that for you.

Benefits of taking charge and investing on your own 

Notice the phrase I used; “Taking Charge”. Let me ask you a question. Who cares the most about your investments? Is it your broker? Your advisor or banker? It’s YOU. By taking charge of your investments, you have complete unbiased control on how you should manage your portfolio. If you’re not sure what investments to make, then you should go about educating yourself and learn as much about the types of investments you want to make. A lot of people fear that they are not experts in investing and believe that an investment advisor or portfolio manager would help them produce exceptional returns. This is not necessarily the case. There was a 2009 study done that showed that over a five year period, 71% of active fund managers DID NOT outperform the S&P 500 benchmark, the general stock market barometer. This means that the majority of fund managers out there produced sub standard returns. So the question you should ask yourself is: why should you consider giving money to these so-called experts when you have the possibility of performing better than them?

If you have the interest, desire and passion about investing, take control of your financial future and continue to develop your investing expertise.

For those interested in reading the Maclean’s article, please click on the link below:

http://www.advisor.ca/microsite/mfinancial/showdown-online-versus-managed

No Comments

Post A Comment