Author Topic: Vanguar to Financial Advisors: "don't try to beat the market" whitepaper  (Read 1273 times)

Habilis

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Found this whitepaper in the "Financial Advisor" section of Vanguard's website

"Putting a value on your value: Quantifying Vanguard Advisor's Alpha"
https://advisors.vanguard.com/VGApp/iip/site/advisor/researchcommentary/article/IWE_InvResValueAdvisorsAlpha

It outlines a strategy where advisors can help their clients not by trying to beat the market, but by doing the following:

Asset allocation
Choosing low cost investments
Rebalancing
Behavioral coaching (don't jump out when the market crashes)
Asset location (what to put in taxable vs. tax-advantaged accounts)
Withdrawal order
Total return approach (take capital gains and dividends)

They sum up the benefit from each of these and come up with a 3% benefit, by which advisors could justify their fees.

My perspective is, "Do It Yourself!" But this is still a good guide.


deborah

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This is really worth looking at - thanks very much for the link!