Wednesday, July 25, 2007

Loser stocks, loser stockbroker

Yesterday marked the end of Month 3 since the broker at Wachovia (Santa Barbara branch) informed me of the contents of the investment account I was to inherit after my father's death. I tracked the 4 funds and 1 stock for these three months to see how they performed.

Of the 5, one was flat (less than 0.1% increase in three months) and all the others had lost money. In fact, all the others had lost money at an annualized rate of more than 12%. To add insult (and further injury) to injury, they were all items that had high management fees attached. And in fact these had been losers for the entire three months that I tracked them, while the stock market itself had been on a wild increase for the same time.

It is unbelievable to me that a professional investment adviser would have initially chosen and continued to stay with things such as this. It's unconscionable and in my opinion professionally negligent. My further opinion is that the guy is incompetent, but my father stayed with him because he has a nice Irish-sounding name.

I called the guy's assistant Naomi on the exact 3-month "anniversary" day and told her to tell Brian to sell everything. That day. She asked (courteously, which is more than I can say for him) why, and I told her "Because they are all losers". I think she is his assistant because she is in training to become a broker. I hope I have illustrated for her a bit of what happens to an incompetent when a no-BS person comes along.

I got the account statement first thing the next week, and took it to my guy. He seems better, but he also seems spread far too thin by his company. So I'll have to make most of my own assessments and decisions, and just tell him what to do and when to do it. I'm still playing the unsophisticated and semi-ignorant investor-dude for all of them, just to see how I get treated. But at least I got out from under the Wachovia loser.

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