Next for this month’s article we recommend that readers take a look at a recent New York Times piece written by a Harvard economics professor titled “Why Investing is So Complicated, and How to Make it Simpler” (click here for link). A key point in the article is that investing is complex but the industry does not try to make it easier which causes many people to avoid dealing with their investments. The author implies that the industry deliberately confuses matters unlike, for example, the smartphone industry which competes to create the most elegant user interfaces. The article adds that if a fiduciary standard of care was required by all financial advisors consumers would get much better advice.
Finally, a quick six month update for Downtown Investment Advisory. Eighteen months into the launch of the firm assets under management exceed $25 million with accounts ranging in size from $50,000 to over $3 million. We are currently working with over 20 clients as well as acting as financial advisor and fiduciary for a 401(k) plan. While our portfolio strategies are broad and include allocations to various combinations of stocks and fixed income, about two-thirds of assets are invested in managed fixed income accounts with clients seeking to earn steady annual income in the 4%-8% range. DIA's value proposition remains sophisticated, conflict-of-interest free investment management services tailored to each client, with an emphasis on intense personalized service and attention, at a highly competitive cost.