Estate Planning

An Investment Bankers' Last Wish

By Hull and Hull LLP

I have to shamefully admit that I haven't always had a great grasp of my investments. I distinctly recall that most meetings with my financial advisor involved me nodding dutifully when he explained why I needed to invest more in this stock and less in another.  More often than not I'd go along with the recommendation, with no real sense of what was happening to my hard-earned money. I have only myself to blame, I know.

I have finally started paying attention, which is why I found Gordon Murray's story so interesting. Gordon Murray is a former bond salesman for Goldman Sachs, who rose to the managing director level at both Lehman Brothers and Credit Suisse First Boston. In 2008 he got diagnosed with a type of brain cancer.  His decision about what to do with the time he has left was to write a book called 'The Investment Answer' with his friend and financial adviser Daniel Goldie. 

The book explains investing in simple steps, and was inspired by what he learned in the last few years about dimensional funds. Mr. Murray wanted to get the word out before it was too late, and he did. The book reportedly asks readers to make just five decisions:

- First, will you go it alone? The authors suggest hiring an adviser who earns fees only from you and not from mutual funds or insurance companies.

- Second, divide your money among stocks and bonds, big and small, and value and growth, as a less volatile portfolio may earn more over time. '

- Third, subdivide between foreign and domestic.

- Fourth, will you be investing in active or passively managed mutual funds? The authors do not support active money management.

- Finally, rebalance, by selling your winners and buying more of the losers (while hard to do, it apparently improves returns over the long run).

Now this book, I've got to read…

Have a good day,

Natalia R. Angelini - Click here for more information on Natalia Angelini.

Full post as published by Toronto Estate Law Blog on December 16, 2010 (boomark / email).