In my life there have been about six times when a decision left me full of angst and uncertainty. Car buying. House closing. Choosing a health plan. A couple of others. And determining what to invest in, and which advisor to work with.
I am not alone on that last one. You only need read the WSJ for about 20 minutes to realize that there are thousands of options and very little in the way of truly reputable advice on which to base your investment advisor decision.
You uncle tells you about his financial advisor, and you go with her just because. You stick with the guy you’ve got, because, well, you don’t know WHO to switch to.
Oh yes, there are ratings services and all that. But I’ve been in marketing long enough to know that you can cut ANY data in such a way as to have an upward pointing graph. And there’s probably a ratings organization that will give a AAA to anything.
Thanks to financialjoe, a new community for individual investors, you can get a lot of new information on what to do and who to do it with. The idea behind the site is to let a community of involved investors collaborate to find the best investments and advisors for their particular investment style and risk profiles.
Wouldn’t you rather SEE how a particular advisor is doing for people that think like you do? Wouldn’t you rather share thoughts about what you are doing? And in so doing begin, perhaps, to level the playing field versus the major Wall Street institutional investors?
To fully participate in the site, you first take an Online Asset Questionnaire that analyzes your goals and risk profile. This 15 question tool was developed in close aprtnership with a core team of advisors and investors who helped identify the characteristics of their relationships that resulted in long-term satisfaction. Apparently many advisors who use the tool find themselves changing the way they work with investors -- for the better.
financialjoe finds like minded investors for you by comparing your answers to those of other members. From there, you can observe what they have revealed about their investments, share opinions on advisors, and track the specific performance of advisors through information they make available on the site. You can also rate advisors that are not yet participating in the community. financialjoe isn’t in the business of advising you – rather, you and your peers share with one another, and consider the ideas and track records of investment advisors that participate in the community.
The import of this site is that it is a great example of how digital and democratization of information are eliminating the friction in the market in many categories. Why have dissonance and angst when you can participate in a community and get the answers and information you desire?
Years ago when I was in business school, I had a prof that said that the individual investor is probably best off buying S&P 500 index funds until they are 50 or so, because the best you are going to be able to do is to meet the market. Beating the market, in his view, was an unrealistic expectation because of the huge disparity in the information YOU HAVE versus what institutional investors have. Now all this was before the Internet got its start, but I expect that the disparity of available information is even more pronounced today.
financialjoe can’t get you all that information. But what it CAN do is help you make more informed decisions in who you invest with and how you invest. And that, my friends, sounds like progress to me.