Should I Go It Alone?

Over the past year I have been an advocate for using an advisor as a source of some good advice and as a way to keep a small barrier between you and your money, to prevent over-active trading. Frustrated by the fact that Clearsight Wellington West, after getting rid of my former investment advisor, has not bothered to call me, and unimpressed by what I see on the web pages of investment management companies, I have been contemplating going it alone. The main reason I got a financial advisor was to stop me from doing stupid things and that worked. It was also done to save myself time. But if I don’t do stupid things and stop trying to be too active with my money, then it should not take too much time. Having an advisor for the past year was a great experience. Over the year we never sold a single investment. I don’t think I ever went a year before without at selling a mutual fund at some point. Am I ready to go it alone? I don’t know, anyways, it is just an idea at this point.

After my unsuccessful search for an investment management company, I briefly looked at options for self-directed RRSP accounts. I first looked at TD Waterhouse (I used to be at TD Waterhouse and TD EasyWeb) because I really like their web services. I also looked at E-Trade. Their trades are a bit cheaper at $20. My portfolio as it stands right now mostly consists of a bond mutual fund, a Canadian ETF, a Canadian small-cap mutual fund, a US mutual fund, and an international mutual fund. I might switch the US component to an ETF and leave the CDN small-cap and international where they are for the time being. If after the transfer is all done from Clearsight to E-Trade and I buy 1 ETF, if all I have to pay is $20 then that is pretty good. It looks like their have some conceirge account transfer thing so the transfer fee is waived if you have more than $25,000. I have that much but my wife doesn’t so I’ll have to think about what to do there.

3 thoughts on “Should I Go It Alone?”

  1. I depends 😉

    If you think you are ready, and think you can apply the required self-control to stick to your plan, then it’s probably worth having a go at DIY. At least you’ll find out after a year if DIY is for you, and, provided you exert some self-control and don’t deviate too far from what you currently have in place, you should’t do yourself too much fiscal harm – think of it as the cost of learning.


  2. I am currently doing both, I have about 30% of our portfolio managed by an advisor and the rest managed by me. Until the recent income trust debacle the portion of the portfolio managed by me always (since 2003, when I started managing a separate portfolio) out-performed the advisor managed portfolio. My plan is to eventually move all the assets out of the advised portfolio. Personally I think it is very possible to do well managing your own portfolio but you have to understand what you are doing. You have to understand what a balanced portfolio means, how much risk you are taking in the positions in your portfolio and you need to have clear long and short term goals for your portfolio so you don’t just chase the hot sectors of the month…

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