That's most impressive! So was it your idea or your wealth manager's idea to buy TSLA and BIDU at such rock bottom prices? And if it was your idea, as I strongly suspect, then why on earth would you trust a wealth manager to make stock decisions on your behalf. Just curious to learn what kind of expertise or value do wealth managers bring to the table.
I used to subscribe to several Motley Fool advisories which recommended Baidu. I promptly bought in at $86+ just before their 10:1 split. Haven't bought or sold since. It is sometimes scary but still dominates search in China and when Google was present on the mainland, Baidu seemed to be gaining, certainly not losing its market share. Robin Lee seems to be repeating Google's playbook by diversifying plus has weathered the storm of cell phone shift in search without too much difficulty.
TSLA I did on my own, way before Motley Fool based solely on the information the roadster could get 300 miles range on a charge. Bought more on news: 1) stamping machine bought cheaply then after installation, workers quit their German company and signed onto Tesla, 2) Fremont factory bought for a song, 3) Model S rating by Consumer's union, 4) supercharger network, 5) Gigafactory, 6) M3 reveal. and now AP lead with fleet learning.
I tried to buy SCTY on initial public offering but Schwab would not let me do so, probably since I checked "long term growth" rather than speculation as my goal for the purchase. Bought in later at various price points and when I rolled over a 401K into an IRA with Schwab, foolishly considered it a safe "utility" and bought that stake at $82+. It is quite clear now their original approach up fronting the cost is not the way to go for consumers. I also thought it was "cute" they were doing the same as the bankers by monetizing their debt, if that's the right term, or at least bundling it and selling to others.
I've been impressed with a guy whose handle is Esekla on Seeking Alpha. He's one of the objective guys with a background of successful investing. He's more traditional on Tesla but pushes things like Nvidia, which I bought, and LG Display (Amoled screens), etc. Those recent bets our manager sold and went into pharma. I did a survey of his new purchases versus our old and in the first year they were pretty close so didn't worry. Thanks to TMC I am very impressed with Nvidia's research on teaching a car to learn how to drive. Then I felt maybe I should revisit our manager's choices, naw, "I don't even want to know if he's screwing up," I told my wife. But I checked Nvidia and learned it had gone up about three times over the 18 month period!
Why a wealth manager?
I am 80 and my wife is 40. QED. She's really smart, sometimes terrifying, because this peasant child is now getting a nearly first class college education. Fortunately she is a gentle soul and thinks I have, as the Thai put it, "a good heart." But she hasn't the time nor should she have to take it to learn how to invest. Maybe later she will.
We looked around locally and spent some time trying to find someone. We might have selected someone locally but at the end when we learned actual contact with the stock advisor would be remote since their guy is located elsewhere. I asked why we should go with them when in Delaware, equally close electronically, our family's advisor who two generations have trusted? Of course they had no answer. We were pissed.
My mother died just about two years ago a few months after her 99th birthday. Our manager did well for my late sister. He managed my mother's affairs with about $450,000 over a 20 year period which kept her steady with an income of $30-35,000 to cover all of her expenses. She left my brother and me about $177,000 each. I was impressed.
We have reason to trust him implicitly as we are almost like family and we are charged 3/4 of one percent even though we are far from his normal rate for that in accounts over $1,000,000. That in itself is insufficient reason to go with him. We have about a 11% loss with him since taking over from our affairs in about 15 months from our high but that may be because TSLA and Baidu and the market generally is so volatile. Many of his choices have done well. We did not discuss in detail how things would go, I've told him not to sell Baidu, SCTY, or TSLA without consultation. I have some TSLA in a Roth IRA which he does not charge for. Recently he called to see if I was still bullish on TSLA, don't know if he was checking for another client but a distinct possibility.
Both my late sister and my seven-year-younger brother had/have health problems but I take after my mother so I was more confident in my own longevity until a pacemaker implant and later diagnosis of afib within the last year. Therefore, we can always be surprised by the future so it seems the decision to hand off decisions to someone else is correct in our case. Please let me know if I'm wrong in this analysis. What I learn in the NVIDIA case is that wealth managers don't necessarily know as much as we do because we follow or search for only a few stocks and they have clients with differing objectives. E.g., my brother wants fixed income with security; we don't need income as long as I'm alive, but want reasonable security. Until the takeover by the manager, Schwab rated our growth per annum as 32% in their time, whatever, weighted average scheme over about an 8 year span. But that included about $100,000 in additional savings added to the accounts so given the minute size of our stake it doesn't count for much.
As I've said elsewhere quoting Shakespeare on loans, its foolish to give advice but as a foolish old man like Polonius I will anyway.
If I were starting over as a young man I would ask you what to do. Next, for tips, I'd follow Esekla's analysis. I think for $50 a year he will send you anything he writes. Then, of course, I would never buy anything unless I was willing to lose that amount. It goes without saying, to turn a phrase, I would spend as much time checking things out as I could spare. TMC is a great source for TSLA, for example. Bloomberg catches a lot, Electrek is wonderful, the New York Times is usually reliable, despite that horrendous test drive in cold weather a few years ago, yada, yada, yada.
