It all boils down to whether or not you want to take over control of someone else's money, and how you want to treat that person after you have done so. That's the bottom line.
Registered Representatives (the legal phrase for a stock broker) must, by law, take into consideration a multitude of factors involving the client's willingness/ability to assume risk. Brokers can have their license taken away if they pitch the "wrong" stock/bond/fund to the "wrong" client.
My complaint about these so-called gurus that pitch stocks to their paying clients is simply that they may not consider the client's personal weak points. Many, many investors have been blown up in the last 6 months because they blindly followed someone else's (broker or "guru") bad advice. Once they are blown up, they can complain all they want, but the fact is that if you turn control over to somebody else, you have to that degree given up control of your investments.
If the advisor is interested in helping the client understand how to invest better, then I applaud that. The problem is that some advisors have their own income demands put before educating their clients. I've met brokers that wanted nothing more than to keep their clients in the dark...the thinking was that if the client learns how to invest properly, they would no longer be a client.
Jenna probably pulls in over a hundred grand a month from her clients. A@P is probably in the same range. Good calls or bad calls, the money arrives each month. That's a powerful magnet for someone who wants to pitch investment advice. A broker that makes that much dough a month is in the upper 1% of his industry. I know more than one day trader that makes that much every week. They have absolutly no interest in 'educating' anyone in how they do it. What possible reason would someone who takes that much dough out of the market every week have in telling anyone how they do it? <G>
There is no substitute for education, and if someone jumps in the pond with the sharks, he better be ready to either bite, or get bitten, because there's no half way. If someone is unwilling or unable to learn, then they are better off buying mutual funds.
If a broker or a "guru" is unwilling to educate his clients, you have your Big Clue. |
