WiseBird Financial Group

Stewart Ogilby
Stewart Ogilby
FINRA S65, Fiduciary

The first modern open-end mutual fund was introduced in 1924. The creation of the mutual fund concept was a huge boon to stock and bond investors. It provided diversification, liquidity, convenience, and professional management.

The numbers and types of funds have soared over the years. Sold by brokers, mutual funds now dominate the investment world.

Today's huge brokerage firms spend millions of dollars in supporting a "suitability standard" that pertains to sales of financial products.

These institutional advertising monies are gleaned from clients through fees and charges within portfolios established through sales of investments, largely mutual funds.

An important fact can be found in a Kiplinger Magazine April 15, 2015 article written by Stephen Goldberg:

Thanks primarily to their rock-bottom costs, index funds have outperformed roughly two thirds of actively managed funds across all kinds of markets — and they'll almost surely continue to do so. What's more, picking the one-third of funds that will beat their indexes is extremely difficult; many argue that it is impossible.

If one remained fully invested, it took around five and a half years just to return to a break-even value following the 2008 "market adjustment". Financial experts refer to this as volatility risk.

When markets decline it is evidenced in corresponding index funds as in 2008. For persons in and near retirement the results were depressing. For retirees taking income from their portfolios the losses were devastating.

I consider it to be an important responsibility to provide information on ways to reduce portfolio risk. Safety, the protection of family assets, is primary today for the overwhelming majority of employed and retired Americans.

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