Insight of the day

[mdlbear]

Realized this morning that most of the trouble I was having with $insurance_company were due to the fact that they're not set up for any way of doing business except through your own unique agent. This is not the way I'm used to interacting with large companies. I'm used to it with health-care providers, but even there it was a long time before I figured out that I had to pick a doctor at Kaiser: before that I just went in when I was sick.

As it turns out, stock brokerages work the same way -- your connection is to the broker, not to the company. This explains why I've never really gotten a handle on my investments.

Now that I understand this, maybe I can start fixing it. Or turn the investments over to the flower_cat, who does understand how to do business through a personal connection, and is comfortable with it.

Comments

[catsittingstill.livejournal.com]

Um. If you're handling your investments as individual stocks bought through a broker, you might want to switch at least some of them to some sort of investment fund-type setup like Vanguard or Fidelity. The fees are a lot lower, and since fees basically sip the cream off the profits, that's generally a good thing. It also doesn't require an agent.

I'm not very well equipped to give financial advice, but if the For Dummies books don't make you break out in hives, there's a "Personal Finance For Dummies" book that does a good job explaining the different kinds of investments and how to take advantage of them over the long term.

[mdlbear]

They're mostly in mutual funds, but there are some stocks in there. We just recently bought Investing for Dummies; the "Personal Finance" book would probably be useful too.

[catsittingstill.livejournal.com]

I'd read the investing one first; if it has what you need, you won't have to spend the money on the Personal Finance one :-)

[patoadam]

What Cat said. I haven't asked a live human being for investment advice in decades. I get most of the information I use to choose investments at www.morningstar.com. For historical reasons, we have accounts with four online discount brokers that don't bother us with investment advice: Fidelity, Schwab, TD Ameritrade, and E*Trade. I'm happy with all of them, although last time I looked, Schwab had slightly higher fees.

When selecting mutual funds, I invest only in no-load funds. I look at historical risk-adjusted performance (Sharpe ratio), and I totally ignore absolute performance.