https://pamarnudisse.ga/map26.php Warren Buffett even lost money on some of his holdings -- Berkshire Hathaway itself is probably the best example of this. A finance professional who claims to have never lost money on an investment has either just started his investment career, has only put his money into bank accounts or short term government bonds, has been hanging on to paper losses for quite a while, is better at value investing than Warren Buffett, or is just a liar. Which do you think is most likely?
Intellectual honesty pays in the world of value investing. Actually, it doesn't even have to be intellectual or value investing -- just plain honesty pays when it comes to any type of investing. Let's forget for a moment about the ethics of making false statements to clients -- I hope everybody realizes just how wrong that practice is and how financially devastating it can be.
I'm a firm believer that, especially in the public eye, lies and dishonesty have a tendency to catch up with you. The risk that you'll be found out eventually, ending your career, is pretty large. Charlie Munger once told an interviewer how successful the Chinese brainwashing system was. The Chinese would just get prisoners to make statements until they believed what they were saying. It would start off small, perhaps something like, "It's raining today," but then they would eventually walk the prisoner through increasing levels of verbal compliance until the prisoner was a card carrying communist.
Never underestimate the power you have to lead yourself astray by saying things you don't initially believe. Be honest with yourself. If you're after a good long term value investing track record then being able to admit when you made a mistake or that you have had to adjust your investment strategy due to earlier mistakes in decision making helps improve your investment process over time. What would that do to your own long term net worth?
Saving face or purposely misleading others can destroy your portfolio. If you've spent a good amount of time misleading others then you're that much more likely to buy into your lies yourself. That's just how human psychology works. You want an adviser who is comfortable making the big decisions with enough reserve to withstand big-risk temptations on behalf of the client. But any financial adviser who is banking on their ability to beat the stock market and provide exponential returns is already going rouge with your cash.
Unless they also have hidden psychic powers, they will almost never truly deliver on that promise — especially when the primary goal of financial planning is creating a means to enjoy a lifestyle you want.
If your planner only focuses on beating the market, expect irresponsible investments to haunt you for years to come. Fiduciary advisers are the only professional obligated to protect your interests. If your financial adviser is not acting as a fiduciary , you could receive subpar advice that ruins your investment portfolio and overall financial picture.
Ensure your adviser is a fiduciary, meaning they have a legal requirement to act in your best interest, or seek out someone who is. Be wary of advisers who just push products.
Aggressively pushing products could suggest your financial planner is really just in it for the extra cash. Typically, financial advisers get paid in one of two ways: Fee-only advisers earn money solely from the clients they take, whereas commission-based advisers receive a kickback from the products they successfully sell you. Some suggest fee-based advisers are more objective with their clients, but it would be unfair to classify all advisers the same.
If your planner is continually pushing products, such as whole life insurance or mutual funds, then their primary objective could be to make the most money with commission from their recommendations to you. Make sure your adviser specializes in your area of need. Some professionals might be apt to assure you they excel in your specific area of need, when in reality they do not. Find someone who has an inordinate focus on one part of your finances to help ensure sound advice.
For example, someone with experience in investment strategies might not offer the same expertise as someone with a background in life insurance, college planning, or families with children with disabilities. Are they being honest about hidden fees? Any sales person will verify that commissions are often their biggest motivating factor for securing new business. When was the last time you did anything for free? There are many lies of omission that money managers use. This was one of the things that the Dodd-Frank bill sought to fix and failed.
Money managers can take your money - and then use it against your own best interest. They can invest your money, then knowing that the product they sold you will fail, can hedge against it. They are not required to tell you that they can take dual positions, for and against an investment product they have induced you to purchase. They say it is your responsibility to perform the due diligence to determine whether or not their actions are morally or ethically responsible.
The average person rarely has the wherewithal to do the research or understand what they are reading to determine the efficacy of complex investment schemes, and yet these are the very people who are targeted for these schemes.
I have found that if an investment manager cannot explain to you what they are doing in such a way that a five year old could understand it that they are lying to you and trying to sell you something that is contrary to your best interest. They use big words and complex terminology and act like they are superior. They are hoodwinking you. The financial press buys completely into this.
I love it when professional money mangers skewer some of Wall Street's biggest fibs. Here's a list of top lies that money managers and. To find out which investing lies proliferate the most – and why they are absolutely false – we reached out to an array of experts in the personal.
There is no end to the number of financial pornography magazines all telling you how their strategies will make you rich. Their goal is not to make you rich. Their goal is to scare buyers into purchasing whatever bullshit research that they have been paid to gen up for whomever is paying them. The economy is doomed. Reverse mortgages are the salvation of mankind. Annuities are the thing.
And then we have the fringe players like Franklin Mint who play on low income suckers on late night TV by hawking electroplated coins and passing them off as numismatic investments or bullion having actual value. People who buy them, secretly thinking thy are buying gold or silver bullion and will someday get rich are being suckered.
Another shark-like industry is the home mortgage industry. These smiling sharks are constantly churning the water looking for suckers. They are making a killing every time you turn over your mortgage - and every time you do, the clock starts over for you. Your house is NOT an ATM machine squeezing out money and people trying to convince you to go to Aruba on a cash-out refinance are doing you no favors. The Insurance industry is another total scam. Whether you know it or not your insurance policies change every single year.
And the one thing they NEVER tell you is that if you make three claims on your homeowners insurance - they will dump you. Their job is not to insure you. Their job is to find ways to avoid paying you when you have a claim. I have often said that if we jailed all the insurers and released all the current inmates, including the serial killers, we would be better off as a society.
If you want really slime and real sleaze, simply step into the office of an insurance salesman and see what happens. Buying stocks is generally like going to Vegas. Over time and throughout history nothing has performed better, safely. First, no one — not even or especially so-called experts — are right all of the time, or even most of the time. A seersucker suit Photo: Second — and worse — most investment experts or investment advisors, or private bankers, or something similar are looking out for their own interests first.
Investment advisors break the law in pursuit of their own interests with alarming frequency. A recent study in the U. It found that 7. There are a few ways to defend yourself against bad advisors. One way is to avoid them altogether, and chart your own financial future.
Maybe my question was too advanced. And why am I investing in this, does it fit my plan? And if they seem to be staying away from the percentages, ask them for the percentages. Their concern is only themselves: I've also continued to feed my habit of reading high quality material about how to manage money, high quality material written by legendary investors.
Another way is to arm yourself. A smart patient researches his ailment before he steps foot into the hospital — so that at least he knows what kinds of questions to ask the doctor. Similarly, if you know what to watch out for in investment advisors, you can protect yourself.
And many of them are highly profitable — for the advisor and the insurance companies that offer them. The vast majority of investors are much better off without them, though. Management fees charged by investment funds themselves can also add up very quickly. And the fees offset any potential tax savings the products are supposed to offer.
The average investor would be much better off opening an online trading account and owning a basket of exchange traded funds ETF. There is a role for financial advisors for certain investors. This is a guest post by Stansberry Churchouse Research , an independent investment research company based in Singapore and Hong Kong that delivers investment insight on Asia and around the world.
Click here to sign up to receive the Asia Wealth Investment Daily in your inbox every day, for free. And if they seem to be staying away from the percentages, ask them for the percentages. Is this the same type of percentage we are talking about? Wait for the answer.
It can either be a yes or a no. Then ask them for an official quotation of the projections, hand them your mobile with a financial calculator app downloaded and tell them to work out that promised percentage using only two sets of numbers - your investments, and the final amount you are projected to get back upon maturity of the investment period.
Every other detail is a smokescreen to complicate your mind and your calculations. Moral of the story: They will hide behind all sorts of details to gimmick your signature onto the dotted line.