Opinions Differ but it’s highly recommended investors insist their advisers get to Pooled Investment Vehicle. There is much reason and to highlight some of them:
From an Investors standpoint :
A. No investor wants their Net Worth to grow little or shrink when the markets are so unpredictable. An investor invests 100K for example in the year 2012 aiming for KIDS education when the kid is 10 years old and in next 6 years, he/she goes to university with a goal to use the money for education. And after 6 years the net worth is still 105K or 90K. Is it worth the investment?
B. In my opinion, I rather have a monthly check coming to me vs. waiting for uncertainty and unknowns which is under no one’s control. With that monthly check, I can keep it in the bank separately or use it for my kid’s education or do whatever. But I am assured that even if a market turmoil happens my extra income from investment which is in this case – the stock market is secured.
Much better feeling if you compare point (A) vs (B).
Is it better to lose money as mentioned in point (A) or pay tax and then take care of kid’s education? Kid’s will not wait till you are 65 to retire and enjoy tax holiday which usually all advisers recommend. You need money TODAY for your kid not when you are 65, by then your kid might already be a grown up already in the workforce.
This theory ONLY works if the adviser generates decent return an investor gets still decent monthly check after paying fees and taxes.
And finally, the cost of commission reduces significantly in Pooled Investment Vehicles.
From an Advisers / Wealth Managers standpoint :
- To maintain a low cost of operation, generate higher ROI% with very low Draw Down% and Scale exponentially without increasing cost.
- To be able to disburse cash to out-going investors who are into Pooled Account. Our strategy rotates cash daily and available cash is always there.
- Our strategy with Software As A Service along with Interactive Brokers Software (OMNIBUS ACCOUNT) it’s possible. OmniBus Account from Interactive Broker would make easy even a wealth manager has 100 or 1000 individual account. Same effort. Also, refer to our Product Tab as how scaling can still maintain a low cost of operation. Every individual account would have their own login and statement for themselves.
THIS IS FOR US ONLY, NOT SURE HOW IT WORKS FOR OTHER COUNTRIES. Advisers or Wealth Managers will have to find what is possible for their own country and as per their compliance.
Additional MUST READ links are provided below :
https://www.interactivebrokers.com/bro/en/main.php#open-account
https://www.interactivebrokers.com/en/software/applicationguide/home.htm
