Author: David C. Arena

Article:
Why you should fire your broker or financial advisor

by David C. Arena

The recent bear market should have opened the eyes of
investors, making them realize that you can't possibly think
someone else, such as a financial advisor or broker can care
more about your financial situation than you do. Now that
investors have lost in some cases over 80% of their retirement
accounts, all that these so called "advisors" can do is put
their hands up in the air and say I was wrong. That is simply
not good enough for clients who have trusted that professional
for 10, 15 or 20 years. I know people that literally had to put
retirement plans on hold and go back to work because they can't
financially support themselves after these losses. Brokerage
firms teach their brokers to advise clients that thinking long
term by making them sit in mutual funds for years and years is
the way to come out ahead. This is done in an attempt to easily
control that client for a long time while continuing to collect
commissions no matter if your money is growing or not. What if
after years, your funds didn't grow enough to meet your goals?
When we have a market fallout like we did a few years ago,
advisors simply say, "that's ok, we planned for these ups and
downs, now we have to stay invested and wait for it to go up".
They are preying on a person's fear. "If I leave this advisor,
will I be wrong"? This keeps most investors with an advisor for
much longer than they need to be. There is no excuse for having
major losses like this, it is simply the advisor's fault. You
either were not diversified, the investment choices were poor or
they didn't take profits and manage losses properly. Believe it
or not, the main problem is that brokers and advisors don't know
enough about the investments they are recommending. The major
brokerage firms influence their brokers by pushing whatever
product they want clients to buy. They will even sponsor nice
lunch meetings with the sales staff, so the brokers rally behind
this product and then immediately sell as much as possible to
their clients. These recommendations are regardless if the
investment is appropriate for the client or not. The brokerage
firm will even offer contest incentives to those that push the
most product. Does this type of selling seem like it has the
investor's best interest in mind? Then once you buy it, they
make sure you feel comfortable just sitting there not making any
major decisions and hoping the advisor knows what he is doing.
It's about time people knew that there is nothing glamorous
about a financial advisor or stock broker, they are simply over
glorified salesmen. Most couldn't predict the correct direction
of a stock if his or her life depended on it. And independent
financial advisors do the same thing. They may not have a large
firm telling them what product to push, but they have several
mutual fund choices to pick from, each offering incentives or
certain commissions for using their fund. And why all the mutual
funds? Because they are easy to sell and the broker doesn't have
to worry about getting calls every day from annoying clients
wondering if the 50 shares of some stock they just bought is
going up or down. Mutual funds are for the long term they tell
you, so you are supposed to sit and wait. The most ironic thing
about mutual funds is that they claim to be long term
investments, but the fund managers are actively trading in and
out of positions daily without the client even realizing. But
these brokers tell you that active trading is dangerous. Why?
Because they do not have the know how to manage such an account,
having to give you advice sometimes intra daily. They also have
no interest in actively managing such an account. It takes up
way too much of their time to baby sit a bunch of clients, but
more so, they do not have the expertise to correctly advise you
of what to trade or how to manage risk. What an advisor wants is
to put everyone in the same few long term investments and review
everyone's portfolio once a year. Then, they can sit back and
manage more clients and more assets, collecting a small
percentage on those assets for their trouble. Minimal work for
maximum gain. And what if you are ready to retire after waiting
for 20 years through a good market and the bubble bursts like it
did a few years ago and suddenly you have only a fraction of
your retirement account left? What then? You work some more? Is
this a position you want to be in after all is said and done,
because you put faith into some other person looking after your
finances? How much attention do you think you will receive from
a so called "full service" broker? The really savy ones will
call you after they haven't spoken to you in a few months and
tell you about a great new mutual fund that he heard of over
" lunch" and advise that you buy some. So, after he just
railroaded you for a 5% percent fee on the last mutual fund, he
will take your money out of the fund he just sold you and pop
you into another one, so he can earn another 5% on the same
money. Not only is this immoral, it's also illegal. And it's
done everyday. Anyone with an interest in being a successful
investor needs to learn how to do their own research and make
their own trades. In today's market, you must be an educated,
active trader who has more knowledge than most retail brokers or
financial advisors. If you can do that, you will be a wealthy
investor. If not, you will simply be an average investor or
perhaps even worse if you allow the market to control you
instead of controlling the market.

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******* David C. Arena is a Wall Street veteran of over 10 years
and has developed his professional trading strategies into a
simple to follow step by step options trading course valuable to
the novice or pro investor. This course is even used by New York
Stock Exchange Floor Traders. Learn How to Turn $200 into $4,630
in 30 Days, How to get Paid for Doing Stock Research Online and
Secrets Brokerage Firms Don't Want You to Know. To instantly
download the course click:
http//hypertracker.com/go/1optionscourse/ezinearticles1/ Free
investment newsletter also included.
*****************************************************************
*******

About the author:
David C. Arena is a Wall Street veteran of over 10 years and has
developed his professional trading strategies into a simple to
follow step by step options trading course. Learn How to Turn
$200 into $4,630 in 30 Days, How to get Paid for Doing Stock
Research Online and Secrets Brokerage Firms Don't Want You to
Know. To instantly download the course, click:
http://www.hypertracker.com/go/1optionscourse/ezinearticles1/
Free investment newsletter also included.

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