Q. We have been discussing putting our investments in the hands of a highly recommended adviser. As part of our discussion, he said that he must have full control of our assets so that he can take advantage of opportunities that are available only for a few minutes.
He wants not only control, but possession. I told him that you are opposed to giving any adviser both control and possession of the securities. He immediately pointed out that mutual funds do just that, and that you’re out of date.
That pointed us in the direction of mutual funds which have performance records at least as good as his. Is this a better way for us to go? We are in our early 60s with no plans to retire in the near future.
A. Giving an individual control of the securities is OK if you are certain of his credentials and performance. However, it is very dangerous for him to have possession at the same time. It is far better if the securities are in an account with a recognized broker. Even a discount broker can do the job more safely.
Mutual funds are far more carefully supervised and open than a financial adviser. There are mutual fund companies that can set up a recommended portfolio of different funds. You might consider seeing a few of them for their recommendations for people of your age with your resources and family situations. There are also a number of newsletters that recommend portfolios. n
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