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Why Mutual Funds Are Hazardous To Your Wealth
#2
Posted 15 February 2009 - 08:59 PM
Its too bad that the author, who claims he is a fee only adviser that uses ETFs for his clients, rips into ALL mutual fund companies. We, of course, do not agree with his thesis about Vanguard or TIAA CREF. Vanguard for example "......will never tell you to move to cash when things get tough because it's just not in their best interest" (quoting the author). Vanguard will never tell you because they DON't know when things will get tough and they do look out for their clients best interests because of their extremely low fees. Excuse me, Mr. Fabian, but do you have a crystal ball that tells you with certainty when "things get tough" and I could not find your fees on your website--talk about transparency. Appears to be another blow hard adviser who has a gimmick.
#3
Posted 15 February 2009 - 09:27 PM
Let's examine the main points of the author:
1. The fund's interests are at odds with yours
Comment: I don't mind if companies make a profit by providing me with a service. I just want to keep that profit as low as possible.
2. No transparency of holdings
Comment: If I invest in index funds, this should not be much of a problem. For example, the S&P 500 Index fund's holdings are pretty well known.
3. No transparency of fees
Comment: This is often true. Lots of companies do a poor job of identifying the fees that they charge. Just look at the fees of variable annuities.
4. All invested, all the time
Comment: I WANT my money to be invested all of the time. The last thing I want is for a manager to try and predict the direction of the market.
5. Peddling bad advice
Comment: The author's main point here is that stock funds don't move out of stocks during a down market. I would be very interested to see Doug Fabian's long term record of deftly moving in and out of the stock market.
1. The fund's interests are at odds with yours
Comment: I don't mind if companies make a profit by providing me with a service. I just want to keep that profit as low as possible.
2. No transparency of holdings
Comment: If I invest in index funds, this should not be much of a problem. For example, the S&P 500 Index fund's holdings are pretty well known.
3. No transparency of fees
Comment: This is often true. Lots of companies do a poor job of identifying the fees that they charge. Just look at the fees of variable annuities.
4. All invested, all the time
Comment: I WANT my money to be invested all of the time. The last thing I want is for a manager to try and predict the direction of the market.
5. Peddling bad advice
Comment: The author's main point here is that stock funds don't move out of stocks during a down market. I would be very interested to see Doug Fabian's long term record of deftly moving in and out of the stock market.
#4
Posted 15 February 2009 - 10:13 PM
QUOTE(apteacher @ Feb 15 2009, 09:27 PM) 
Comment: The author's main point here is that stock funds don't move out of stocks during a down market. I would be very interested to see Doug Fabian's long term record of deftly moving in and out of the stock market.
Seconded
#5
Posted 16 February 2009 - 09:03 AM
Hi,
Notice the words "EFT Trader." He can't make money if people use mutual funds.
Joe
QUOTE
Doug Fabian is president of Fabian Wealth Strategies and editor of the Successful Investing and ETF Trader newsletters.
Notice the words "EFT Trader." He can't make money if people use mutual funds.
Joe
#6
Posted 16 February 2009 - 09:50 AM
QUOTE(sschullo @ Feb 15 2009, 08:59 PM)
Its too bad that the author, who claims he is a fee only adviser that uses ETFs for his clients, rips into ALL mutual fund companies. We, of course, do not agree with his thesis about Vanguard or TIAA CREF. Vanguard for example "......will never tell you to move to cash when things get tough because it's just not in their best interest" (quoting the author). Vanguard will never tell you because they DON't know when things will get tough and they do look out for their clients best interests because of their extremely low fees. Excuse me, Mr. Fabian, but do you have a crystal ball that tells you with certainty when "things get tough" and I could not find your fees on your website--talk about transparency. Appears to be another blow hard adviser who has a gimmick.
The funny thing is that Vanguard makes more money on their cash accounts, .30% - so technically it would be in their interest to tell you to move to cash!!!
ScottyD
QUOTE(apteacher @ Feb 15 2009, 09:27 PM)
Let's examine the main points of the author:
1. The fund's interests are at odds with yours
Comment: I don't mind if companies make a profit by providing me with a service. I just want to keep that profit as low as possible.
2. No transparency of holdings
Comment: If I invest in index funds, this should not be much of a problem. For example, the S&P 500 Index fund's holdings are pretty well known.
3. No transparency of fees
Comment: This is often true. Lots of companies do a poor job of identifying the fees that they charge. Just look at the fees of variable annuities.
4. All invested, all the time
Comment: I WANT my money to be invested all of the time. The last thing I want is for a manager to try and predict the direction of the market.
5. Peddling bad advice
Comment: The author's main point here is that stock funds don't move out of stocks during a down market. I would be very interested to see Doug Fabian's long term record of deftly moving in and out of the stock market.
Fabian was up 15.50% last year.......but down on average 11% the previous ten. Here is a USA Today article by Mark Hulbert on Market Timing in 2008.
#7
Posted 16 February 2009 - 09:53 AM
This just in from Mr. Fabian's web site:
"You don't have to take unusual risks to realize profitable rewards. Successful Investing subscribers have been achieving 15%-20% compounded growth for 25 years... with a simple plan for knowing when to buy and when to sell. That's more than a quarter century's worth of successful investing!"
There you have it, fellow investors. No need to take unusual risks! 15%-20% compounded growth for 25 years! Simple!
Here is more from the web site:
"ETF Trader generates consistent, rapid-fire profits using today's ... investment vehicle -- ETFs. Subscribers can enjoy 5-10% returns in just a few weeks and 25-50% in a matter of months."
25%-50% in just months?
"You don't have to take unusual risks to realize profitable rewards. Successful Investing subscribers have been achieving 15%-20% compounded growth for 25 years... with a simple plan for knowing when to buy and when to sell. That's more than a quarter century's worth of successful investing!"
There you have it, fellow investors. No need to take unusual risks! 15%-20% compounded growth for 25 years! Simple!
Here is more from the web site:
"ETF Trader generates consistent, rapid-fire profits using today's ... investment vehicle -- ETFs. Subscribers can enjoy 5-10% returns in just a few weeks and 25-50% in a matter of months."
25%-50% in just months?
#8
Posted 16 February 2009 - 11:09 AM
QUOTE(Scottyd @ Feb 16 2009, 09:50 AM)
The funny thing is that Vanguard makes more money on their cash accounts, .30% - so technically it would be in their interest to tell you to move to cash!!!
ScottyD
Hi Scotty,
Slight correction, .28% fee on their Prime MM fund.
Yes I agree it would be in their interest, but not their ethics.
Have a great day,
Steve
QUOTE(JMacDonald @ Feb 16 2009, 09:03 AM)
Hi,
QUOTE
Doug Fabian is president of Fabian Wealth Strategies and editor of the Successful Investing and ETF Trader newsletters.
Notice the words "EFT Trader." He can't make money if people use mutual funds.
Joe
Hey Joe,
"EFT Trader," now thats the best example of a definition of oxymoron that I have ever read. You might submit this to this oxymoron website.
Steve
#9
Posted 16 February 2009 - 02:34 PM
QUOTE(sschullo @ Feb 16 2009, 11:09 AM)
Hey Joe,
"EFT Trader," now thats the best example of a definition of oxymoron that I have ever read. You might submit this to this oxymoron website.
Steve
Hi Steve,
I see where I mixed up some letters: ETF not EFT.
Hey,
This guy is showing the way to big bucks: 25% to 50% in a just months. I am pulling my money out of Madoff's fund and moving it to this guy. Madoff is only promising me 12%. :>))
Joe
#10
Posted 16 February 2009 - 08:38 PM
Hey All
Looks like Mr Fabian got all the diehards to come out swinging. Are you guys trying to tell me not to suscribe to his newsletter?
He only sends me 30 e-mails a month asking me to join.
Tony
#11
Posted 16 February 2009 - 09:04 PM
I'm curious: does Mr. Fabian make more money by utilizing his system, or does he make more money by selling his newsletter?
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