Saving Expenses:  Saving and maintaining wealth is a major part of Wealth Management.

Saving Expenses Matters

Savings is profit too. Every dollar that leaves our clients accounts to investment costs is a dollar less our clients and their families have to reach their goals. Creating efficiencies and savings is another way we try our best to improve performance.

First, we operate on an Institutional platform that allows us the benefit of no cost trading. Simply put most transactions such as buying or selling a stock or an ETF are free, so are thousands of mutual funds, and there are no nuisance fees such as IRA custodian fees or inactivity fees and alike. But we take it much further than that whenever possible.

For example, some of the most common investments today are mutual Funds or Exchange traded funds (ETFs). These funds are basically baskets of something (usually securities), that either mimic some index (such as the S&P 500), or the Biotechnology Index, or specialize in some sector or target such as Semiconductors, or China investments, or Gold etc.

The idea is that for most investors it is difficult to create sufficient diversification with a smaller portfolio and these pooled investment vehicles benefit for their size, selling instead shares in that pool to the retail client. It’s all a very good idea but it comes with a cost. These funds have expenses (they afterall have employees, portfolio manager, executives and so on and they all must get paid for their work). So, what happens when an advisor puts his/her clients into a fund is that there is a double layer of investment expense. The client is paying the advisor to manage the portfolio but he is also paying the fund for their internal expenses and expertise. That can range for a low as 1/4 of one percent to as high as a full one percent of the amount invested on top of the investment advisory fee the client is paying.

Using our institutional platform's very advanced technologies and our own internal proprietary systems, we are able in some cases to create a basket of individual securities that mimic the content of these funds. By being able to purchase partial shares of a security, and do it at no cost to the client, we can seek similar results while avoiding these internal fund costs and achieving significant savings for our clients. This means we have to work harder at our job as asset managers, and we bear more of the responsibility for success or failure, but that is our job and we do it gladly.

Finally, because on our platform there are no costs affiliated with the trading of most securities, we are free to be as proactive as we need to be, allowing us to pursue momentum and to feel free to sell and protect our assets whenever we perceive danger, without having the overhead of trading expenses to consider.