Like-minded PP Financial Advisors?

[moda0306]

How do you handle clients with large 401(k) balances?  I assume you factor that into how the portfolio is being split... do you charge 1% of that amount as well?  If not, what if a client has most of their funds in a 401(k)?

[julian]

Do you worry about counter-party risk with GLD and IAU? 

Have you ever considered GTU or even Goldmoney.com?

Why would the risk be less with GTU or Gold Money? Further, why does GLD have more risk then VTI?

[julian]

How do you handle clients with large 401(k) balances?  I assume you factor that into how the portfolio is being split... do you charge 1% of that amount as well?  If not, what if a client has most of their funds in a 401(k)?

401's are a prob if they represent too much of the portfolio as generally GLD & TLT are  not an option.

[AdamA]

"Why would the risk be less with GTU or Gold Money? Further, why does GLD have more risk then VTI?"

GTU and Gold Money hold all of their gold in vaults that are regularly audited.  I don't think GLD does this, and I believe it may actually lend its gold out. 

I'm not saying that GLD has more or less risk than VTI (they are different asset classes), but GLD is definitely different than holding physical gold, which is what it should be compared to in the portfolio. 

Again, I'm not saying that GLD is more or less risky than physical gold, both have their risks.  I am just asking if, when you invest millions of dollars in ETFs that are relatively new, you have any concern about the counter-party risk involved (which is a different risk than holding physical gold in your home).

Just to clarify, I'm not bashing GLD or IAU.  Just curious as to your opinion of the risks specific to gold ETFs, since you have a lot of experience (and money) with them. 

Thanks,
Adam

[julian]

I guess I am just a believer in the system. Nothing fell apart in 2008 so that leads me to believe the system is real and will work. Do I think GLD could have some bad bars or shortage? Probably yes. But that would only be apparent in a 100% liquidation which is why I prefer the larger ETF.

[Maestro G]

Hi Julian,

You mention on your website a total return of 6% for 2008. However, according to Craig's figures for the standard 4 x 25 PP, the return for 2008 was approximately 2%. What accounts for this rather large divergence

Enjoying this thread!

Maestro G

[julian]

The additional return was from using active mutual funds such as FAIRX AND GRSPX etc. for the equity slice. I have been able to add return with very slight mod to how the equity piece is invested

[Maestro G]

The additional return was from using active mutual funds such as FAIRX AND GRSPX etc. for the equity slice. I have been able to add return with very slight mod to how the equity piece is invested

I see. So, with respect to the equity portion of the portfolio, do you intend to continue to actively manage on your own part and through the purchasing of actively managed funds/etfs going forward?

Thanks,
Maestro G

[julian]

The additional return was from using active mutual funds such as FAIRX AND GRSPX etc. for the equity slice. I have been able to add return with very slight mod to how the equity piece is invested

I see. So, with respect to the equity portion of the portfolio, do you intend to continue to actively manage on your own part and through the purchasing of actively managed funds/etfs going forward?

Thanks,
Maestro G

Currently I am using the VTI but would consider going back to funds if I felt we were entering a bear phase

[moda0306]

Julian, due to the tax implications of moving people in and out of different stock funds, do you have a general rule for how well or how sustained you see another fund outperforming TSM?

How do you feel about overweighting SCV given the sector's performance?

[julian]

We are always weighing taxes vs return. Re SCV, I just decided to keep it simple & tax efficient with VTI but I have read all the posts re using various indicies & it is a reasonable thought. I just felt that when I sold the mf's best to stay pure with VTI