This shouldn’t, and doesn’t have to be the case. And frankly, nowadays, it’s almost rare. Most of the proprietary product pushing is long gone. There are plenty of fee based advisors who do not work on commissions and are legally bound by a fiduciary standard of care. Why have that doubt in the back of your mind when working with a professional you should trust completely?
Not to derail the OP's thread. But I have been battling with Edward Jones for over a year trying to get my money put into what I want. It's in a 401k, they call it a "simple IRA". I wanted it to be 50/50 in the SPY and QQQ. Not allowed to do that. I am required to have at least 4 different positions. And they must have atleast 20% in each of these categories. Small cap, mid-cap, large cap and international.
I’m a FA, we are a RIA. We have rolled over so many assets the past couple years from these firms bc of this….Not to derail the OP's thread. But I have been battling with Edward Jones for over a year trying to get my money put into what I want. It's in a 401k, they call it a "simple IRA". I wanted it to be 50/50 in the SPY and QQQ. Not allowed to do that. I am required to have at least 4 different positions. And they must have atleast 20% in each of these categories. Small cap, mid-cap, large cap and international.
Frustrating doesn't even describe this. They tell me that they have me invested for the "long haul, not get rich quick" they say "you are invested in "good, safe growth stocks". But when you have them look up a chart of the SPY and QQQ they either aren't smart enough or don't care to see how much the SPY and QQQ have out preformed thier normal crap they have me in. Thier international stock I am in has something like a 7% growth over a 5yr period. That's not 7% annually, it's over the whole 5yrs. Imagine 20% of your account being in something that has growth 7% in 5yrs
They don't know it yet but they are losing my account Jan 1st
Edward Jones said if I wanted more flexibility with my account that they could move it over to a traditional IRA. The annual fee would be really cheap. But they wanted to charge me $1200 for a transaction fee to go 50/50 into SPY and QQQ. Currently looking to see where I can move it to with lower cost
| Asset | Percentage | Comments |
| US Stocks | 30% | Capitalize on good economic growth |
| US Real Estate (REITs) | 20% | Protection from inflationary environment. Typically low correlation with other asset classes. Payout 90% of net income. |
| International Stock, Developed Markets | 15% | Capitalize on good economic growth |
| International Stock, Emerging Markets | 5% | Capitalize on good economic growth |
| Treasury Inflation-Protected Securities | 15% | Bear market security + inflationary environment |
| US Treasury Bonds | 15% | Bear market security |
Do what you want with your money but show me when in investment history that idea has panned out.
I mean, the Ivy League endowments seem to do alright…
From investments or people keep throwing money at them? Think it’d be the latter.
Endowments and individuals will generally have very different financial goals, so I wouldn’t presume a strategy that is appropriate for an endowment is appropriate for an individual investor.
Some random paragraph that has no actual data? Show me actual metrics. You can’t. Because they don’t exist. You stick with your supposed 8% (don’t think you’ll make 8%) I’ll make money.
Don’t know where you got the article but clearly it is wrong.
Endowments usually continue to bring in donations from alumni and have a consistent annual payout % for perpetuity - both very different fact patterns from individual retirement. Not to mention tax considerations.
Like you, I found the Swensen Model interesting and I’m glad you posted it. Given the analytical expertise they have access to they have allocated 30% to downside risk. Roughly speaking, they have a 70/30 portfolio. As a non financial professional, I would say it’s a balanced or conservative portfolio. Over the up and down cycles it provides steady growth and protects their original investment. As someone mentioned, they have not forgotten the lessons of 2008.
Not sure what you mean by lessons of 2008. But that was a self induced housing crisis. It created a buying opportunity for stock.
