STOCKBROKER RECOMENDATION?

If they were any good, they wouldn't be brokers, they would be fund managers. And most fund managers suck even then.

Think car salesman. Would you ask a car salesman what car you should buy/drive? Same with a broker, they are just salesmen. Following their advice will put money on their table (through commissions) not your table.

 

not true. i have a broker at almost every major house. some do suck but there are a few that are very good.

the fact is the average joe doesn't have enough $$$$ to get the time of day from a good broker.

you can pm me for references if you'd like.

 

Use www.fidelity.com instead. I fired my broker years ago and have made much more money on my investments at Fidelity every since!

 

YMMV, but I remain skeptical. From my experience (sample size of 6-7, plus several times more by hearsay), none were any good long-term, though they all had moments where they looked good for a while.

Granted it's even more of a crapshoot finding a "good" broker if you don't get a referral from a satisfied customer. But here's what happens even if you do get referred to a "good" one -

* the "good" broker gets recommendations from satisfied clients, and adds to their client list;
* now he has an idea, who does he call about the idea? of course he goes down his phone list;
* someone is at the beginning and someone is at the end (maybe its alphabetical, by account size or by longevity of relationship), but the guys at the beginning have an advantage over those at the end;
* perhaps the advantage is small if it's a big cap stock that won't notice a few hundred thousand shares in a few hours or a couple of days, but the better ideas are usually small to mid-caps where a bump in volume can move the stock a few points;
* let's say the gains are there, now it comes time to sell, again the broker has to go down his list, the guys at the end of the list are hugely disadvantaged again
* worse, let's say the gains aren't there and the stock is tanking; if you put a stop in it's likely to be one the broker recommended (after all you're paying him for advice), so now you have a pile of stop-losses sitting at the same price, almost guaranteed to draw the attention of the market makers; if you don't put a stop in, you're back to the phone list situation where the last guys lose the most

This would be avoided if you gave the broker trading discretion, since presumably he would position a block buy or sell for his discretionary accounts first; but that's an even bigger crapshoot in most circumstances.

The standard joke is: "where are the customer yachts?" (asked of a broker showing off his and his buddies yachts).

 

i haven't seen it work that way. they buy/sell blocks of stock and everyone gets the average.

 

Never let anyone who is paid on commision have discretion over your account!

 

imho. unless you have a $1MM portfolio, you have no business owning individual stocks.

 

That depends... if you want to keep things simple and not think about it, then you are absolutely right.

If you are interested in learning about investing, pick up a copy of Ben Graham's "The Intelligent Investor" and give it a shot.