Markets plummeting, dad unhappy.

[whybe]

Hi

About a year ago my father sold his share of an overseas apartment he inherited with his siblings. My uncle took over and my father directed the money to stock market investments. Meaning he *gave it to an investment expert, in the hopes this person could get higher than market returns*. I know, right?

Markets are on a downturn at the moment, and the money is disappearing quickly. My father is interested in summoning said expert and "having a talk", whatever that means and whatever that can do... Getting out of the market would only aid in locking in our losses. Right?

 as much as I implored with my father and brothers not to trust this investment firm, they have gone the "easy" route and let him basically do whatever he wanted with our money. I tried to explain that trying to beat the market is a fool's errand, but to no avail.

Forgot to mention this is supposed to go toward helping me and my two bros buy houses to live in in the not so distant future. Which is why I was so interested in this in the first place.

This is still father's money, even though it is destined for me in part. I guess question is what could be done to prevent irrational behavior on thr part of my family, so they won't sell sell sell...

[innerscorecard]

Is this in mainland China? Sounds a bit like it to me.

[forummm]

A globally diversified portfolio invested in low-cost index funds is doing fine right now. Maybe down a few percent from the all-time high. Sounds like his money's in the wrong place.

[Roland of Gilead]

Must be in the China market...most other markets would be hard pressed to call plummeting (maybe Greece though).

[johnny847]

A globally diversified portfolio invested in low-cost index funds is doing fine right now. Maybe down a few percent from the all-time high. Sounds like his money's in the wrong place.

OP's father handed the money over to an "investment expert." Meaning this money is probably invested in actively managed funds.

Regardless of what country the OP is in, the money is in the wrong place.

[johnny847]

And in response to your question OP.....there really isn't much you can do. Your father is responding emotionally. Trying to use logic on someone who responds emotionally will virtually never work. I've learned this the hard way.

[waltworks]

You need to decide if this money is worth hurting your relationship with your father/family.

If it IS, then you should go all-in and do whatever you can to convince your father to do something more rational with the money and/or just give you your share now.

If it isn't, then you should forget about it and just assume it's gone completely. If you get anything in the future, consider it a nice surprise. Enjoy the company of your family in the meantime and avoid discussing the money with them.

-W

[DavidAnnArbor]

Forgot to mention this is supposed to go toward helping me and my two bros buy houses to live in in the not so distant future. Which is why I was so interested in this in the first place.

Money to be used to purchase real estate in the not so distant future absolutely should not be in the stock market. What are you thinking?  Stocks could plummet at any given moment.

[innerscorecard]

I have the feeling the OP's situation involves both mainland China stocks and mainland China real estate.

[whybe]

Israel market is the one we're talking about (is where we live), but the portfolio is NOT based on large portions of diversified indices. the investor "expert" is basically doing whatever he wants with it, wasting tens of thousands on buy/sell fees (which my father disregards, only looking at bottom line), not to mention there will be the "professional's" management fees to pay regardless of loss. Family simply failed to see that.

[forummm]

I have the feeling the OP's situation involves both mainland China stocks and mainland China real estate.

I don't think it's a good idea to have 100% of your assets invested in stocks from a single emerging market country, even if it's where you live. And China does not even have a good investment environment. For starters, the accounting practices are somewhat Enronesque.

[Retire-Canada]

A globally diversified portfolio invested in low-cost index funds is doing fine right now. Maybe down a few percent from the all-time high. Sounds like his money's in the wrong place.

Yup. I was just looking at my main investment ETFs and then I read this post and thought "Plummeting??? I must have missed something"

To the OP all you can do now is get the money back from the "expert advisor" as much as is left and do some rationale low cost investing with it. Whatever damage is done is done. The longer you wait the worse it will get.

[Scandium]

Should maybe have done before it started falling, but: tell you're father you're just about to buy a house any time now, and ask him to take it out of the market to keep in cash. Then stall and drag your feet for a while. "deal didn't work out" etc. Assuming it's not too long until you actually buy that is (few years, not 10).

[Kaspian]

A globally diversified portfolio invested in low-cost index funds is doing fine right now. Maybe down a few percent from the all-time high. Sounds like his money's in the wrong place.

OP's father handed the money over to an "investment expert." Meaning this money is probably invested in actively managed funds.

Regardless of what country the OP is in, the money is in the wrong place.

^^ Both of these!  But if you can't get him to switch to passive index investing at least remind him if he sells that means there's somebody there waiting to buy who think they're just as smart. 

[bwall]

The Israeli stock market is neither deep nor liquid, so as a result it can be subject to greater than normal swings, both up and down.

The USA was/is the best place to park money. Better than Germany/Euroland, Japan, or the UK.

ANYONE willing to 'invest' in the Chinese stock market should be willing to lose 100% and call it a great experience.

[whybe]

 Thanks,  one and all for your wise words. I am currently going over the portfolio snapshot as it was captured a few days ago and I find myself going 'tsk tsk tsk'... Heavily localized,  almost no etfs, a lot of commercial bonds, no government bills, and 14% invested in the investment firm's own 0.88% managed fund... Oof