did anyone's financial advisor tip them off before the crash

RedRochey

3.4bn not 34bn, executives are always selling their stocks, maybe there was a legal reason he had to sell that week, maybe he wanted to buy a yacht, correlation doesn't equal causation

And that Bill Ackman trade was actually going to cost him $27million per month for five years, it just moved so dramatically in his favour in the first month

Either way, these are rare cases about some of the smartest people in the world, Ackman's hedge fund is still down YTD as far as I know, so to think your financial advisor (who's job is help plan for your retirement in the long term) should've seen this coming is ridiculous

Risk happens

patdownes

a good financial adviser should have done a risk assessment with you and then depending on your tolerance to risk and your financial and age profile and having built up this solid background information should have advised you on a suitable fund structure (usually multi-asset).

In terms of seeing a downturn coming most good advisers would have determined that the market was overvalued for about the last 2 years and advised clients to de-risk down to approx a 3/7 if they were in a higher risk grouping or lower again if in a higher age range. Should they have seen the COVID crash on the horizon. Assuming you worry about your own health and the health of your family, did you see it coming.

In terms of on-going financial advice. People should be more pro-active about their own pensions and investments. Ring your brokers for an update every so often. They're not bad people, they're busy people.

Also, to those posters who come out with the 'they are only glorified salesmen' nonsense. Most advisors take their job seriously, do their research, and spend the time maintaining ongoing agencies to a number of financial providers. they also have to pay full professional fees and insurances. Do they get paid for it. Yes. Do you get paid for the work you do ?

Nemeses2050

I actively manage my pension pot and after negative returns in 2018, was expecting a Market crash in 2019 and moved my pension pot to cash fund and also changed my allocation for 2019 , 50% cash fund 50% level 4 equities...however early this year was contemplating going back to equities and had the form filled...just didn't get around to send it to our pension trust....then the Covid hit the markets...I was thanking my stars....As many have noted above it's really hard to time market...

RedRochey

patdownes wrote: »

a good financial adviser should have done a risk assessment with you and then depending on your tolerance to risk and your financial and age profile and having built up this solid background information should have advised you on a suitable fund structure (usually multi-asset).

In terms of seeing a downturn coming most good advisers would have determined that the market was overvalued for about the last 2 years and advised clients to de-risk down to approx a 3/7 if they were in a higher risk grouping or lower again if in a higher age range. Should they have seen the COVID crash on the horizon. Assuming you worry about your own health and the health of your family, did you see it coming.

In terms of on-going financial advice. People should be more pro-active about their own pensions and investments. Ring your brokers for an update every so often. They're not bad people, they're busy people.

Also, to those posters who come out with the 'they are only glorified salesmen' nonsense. Most advisors take their job seriously, do their research, and spend the time maintaining ongoing agencies to a number of financial providers. they also have to pay full professional fees and insurances. Do they get paid for it. Yes. Do you get paid for the work you do ?

Majority of financial advisors aren't stock pickers, they wouldn't be looking at whether the market is overvalued or not, they set out long term goals for clients (maybe factoring SORPs) and invest across asset classes accordingly. You're basically saying that financial advisors should be trying to time the market rather than sticking to risk tolerance levels

Static M.e.

Nemeses2050 wrote: »

I actively manage my pension pot and after negative returns in 2018, was expecting a Market crash in 2019 and moved my pension pot to cash fund and also changed my allocation for 2019 , 50% cash fund 50% level 4 equities...however early this year was contemplating going back to equities and had the form filled...just didn't get around to send it to our pension trust....then the Covid hit the markets...I was thanking my stars....As many have noted above it's really hard to time market...

Hi Nemeses2050, what do you mean by level 4 equities? I haven't come across that term before.

Nemeses2050

Static M.e. wrote: »

Hi Nemeses2050, what do you mean by level 4 equities? I haven't come across that term before.

I'm with New Ireland and they've risk levels 1-6 ( 1 being the lowest and 6 being the highest)...sorry for not being clear...

Savecoronabeer

Pension funds are set up based on a risk assessment which is taken before a recommendation is made and one of the questions pertains to drops in the markets. Pensions are supposed to de-risk as you get older with a huge chunk of your fund being in cash at retirement.

If anyone in here expressed concern to their financial advisor about how much risk they were taking, a new risk assessment should have been taken there and then with the appropriate funds being recommended. If your financial advisor tries to talk you out of something without giving an assessment I would see this as a serious red flag.

patdownes

No but i agree with some of the points you are raising. generally the risk level of the fund would determine the ratio of shares to bonds to cash. the advisors job is to encourage the investor to select the risk initially and let the fund manager worry about the make-up of the internals of the fund after that. that being said the advisor should be aware of the general movements in the major stock indices and if concerned that a particular asset class is beginning to get overpriced to then advise clients to move down the risk level and so change the ratios (out of stocks). even the lower risk funds started to show a lot of volatility towards the end of 2018 and that was an early warning that shares in general might have been getting to the top of the cycle.

i agree that investments and pensions are a long term move but just accepting the original risk level chosen and sticking with it is assuming that the fund manager is adjusting their asset allocations to take the overpricing into account. an example would be should a risk 5 client with an 80/20 share/bond spread have had his portfolio reviewed and should the advisor have been willing to go out on a bit of a limb and suggest it might be time to lower the risk level.

Separately, I would have no issue encouraging clients to ride out the normal ups and downs with a long term outlook. the COVID 19 circumstance is a unique situation and unless someone moved very early in that cycle then stick it out and wait for the uptick.

cfedsas

A financial advisor is one who identifies new opportunities for you by assessing your short or long-term goals.

bankboucy

My financial advisor has called me three times in the last 30 years......in 1999 just before the dotcom crash, in 2008 before GFC collapse & then in early 2020 to warn me about the pandemic.........I can give you his name if you DM me........he's currently looking to raise cash for an initial token offering i think he called it, he said that some people call them sh!tcoins but not to listen to them they are just jealous little bitches who want to stay poor! :)

dil87

https://www.boards.ie/discussion/comment/112829711#Comment_112829711

This is unfortunately what a lot of people experience. Advisors are just sales people working on commissions. Most will be given the boot if they pull peoples money out, they do not act in your best interest.

dil87

https://www.boards.ie/discussion/comment/112850056#Comment_112850056

This is correct. If you are in it for the long term and have a few decades left before you retire, adding to funds when the market corrects is sound advice. I would not say the same thing about buying individual stocks however, even the institutional darlings of today may never return to the prices they once saw. Take Cisco for example, it was once the Apple of it's time before peaking in 2000 and has never reached that price again since. Stick to adding to funds in bear markets and leave the stocks alone.

TalleyRand83

https://www.boards.ie/discussion/comment/119006661#Comment_119006661

I would gladly switch to funds or indexs, but seems to me to be harder to get to arrange. With stocks I can use Revolut, DeGiro etc but for an index I'd like to invest in a non-ETF structure, but as far as I know its not possible? Hoping I'm corrected on this as would be glad to switch future investments towards funds or indices.

JimmyVik

At the start of the pandemic a few colleagues got spooked and switched their pensions into bonds and cash.

The main advice I got was that normally after a 10 or 20% fall it only takes about 6 months before the markets are back up, so stay in mainly equities.

I dont know how the guys who switched are doing now but at the moment im up about 50% since then (of course i was up by even more a couple of months ago it has to be said).

Im still being advised to stay in equities and that the current downturn will be history in 3 - 6 months.

Wanderer78

https://www.boards.ie/discussion/comment/118821678#Comment_118821678

.....and whos pay is related to your decisions, and can sometimes be incentivised by certain products sold to you!

very few truly seen the crash coming, as most largely ignore the role of banks, money and debt, in our modern societies, and still do......

Donald Trump

https://www.boards.ie/discussion/comment/119008676#Comment_119008676

Im still being advised to stay in equities and that the current downturn will be history in 3 - 6 months.

Not always true. Ask the Japs. I think it took the Nikkei 30+ years until last year to surpass its previous high back in the early 90's bubble on a total return basis (i.e counting all the dividends received after the crash, and the price of the index itself, it took 30+ years to get back to where you were in 1990). The index price level itself is still something like 30% below where it was back then.

Will there be a correction? It is looking like it. Will it go back up to where it is now - eventually. The reason for the rapid recovery when covid came in was due to stimulus money. But we are now dealing with the after-effects of that which is the inflation (exacerbated by geopolitics). Buffet is buying though

Rates are going only one way. Fed is currently meeting and there is a 50bps move more or less priced into the market at the minute. All your tech stocks will get dented far more (relative to where they otherwise would have been)

JimmyVik

https://www.boards.ie/discussion/comment/119008764#Comment_119008764

Thats a tough one. Yes indeed Japan was a basket case. I worked there for a year and people just do not trust investments of any type over there now. There is lots of cheap property to be had though.

But I think im going to stay with mostly equities in my pension.

Donald Trump

https://www.boards.ie/discussion/comment/119008781#Comment_119008781

Pension is fine. Your horizon is much longer than 3-6 months.

JimmyVik

https://www.boards.ie/discussion/comment/119008786#Comment_119008786

Might not be much longer to be fair. Im so sick of the amount of tax im paying im seriously contemplating early retirement. But i havent pulled the trigger yet.

Atlas_IRL

They'll never advice to take your money out, its in there best interest to manage as much money as possible. Would you care if it is your pension? It's in the same boat but people dont care cause they dont look at it and it builds wealth over a long time. Time in the market >

AnF Chuckie egg

https://www.boards.ie/discussion/comment/119009650#Comment_119009650

https://youtu.be/PvIPhv0fKmE

Funny but true

Atlas_IRL

Great Film!!!