Key Takeaways:
- It is possible to implement an asset revesting strategy in your portfolio without an advisor.
- Autotrading and revesting newsletter signal providers are available to help with advisorless asset revesting.
- For investors who like the roboadvisor model, having an asset revesting strategy autotraded in your self-directed brokerage account can help make advisorless asset revesting hands-free.
Not every investor wants to work with an advisor on their portfolio planning. The commissions, meetings, potential conflicts of interest and lack of fiduciary requirements can be a real obstacle for investors who have observed shifts in the financial industry over the past few decades. For these folks, advisorless asset revesting can be a good choice.
What is advisorless asset revesting?
Advisorless Asset Revesting is the self-management or machine management of an investor’s multi asset revesting portfolio. In this scenario, the investor either manually manages their own position movement based on signals for various assets in their hierarchy or they have assets autotraded for them. This includes moving capital out of falling investments and into rising investments as well as setting and recalculating protective stops and cash-outs to manage ongoing profit-taking.
Primary Benefits of Advisorless Revesting
There are powerful benefits to advisorless investing, but the main ones are:
1. Lower costs: One of the biggest benefits of advisorless investing is that it is generally less expensive than working with traditional financial firms like Schwab or Fidelity that charge 1% assets under management (AUM) fees. Without the need to pay for asset management services, investors can keep more of their money working for them. Save 1% per year for decades allows for additional compounding which helps you retire with quite a bit more money.
2. Convenience: Advisorless investing offers greater convenience, as investors can manage their investments online and on their own schedule, without scheduling calls and meetings with an advisor to do paperwork.
3. Control: Advisorless investing provides individuals with more control over their capital. They can change their portfolio positions as they see fit, rather than relying on an advisor to decide for them.
4. Automated trading: Those who are dissatisfied with the limitations of a traditional buy-and-hold investing method now have access to automated trading systems. Autotrading can reduce costs and make it easier for individuals to invest their money and follow proven asset revesting strategies.
What’s the best investing service for asset revesting?
Sadly, robo-advisors like Betterment and Wealthfront, which were created to help reduce the AUM cost for investors, seem to be primarily focused on the same old approach, including buy-and-hold. That means many of them don’t have the programming to recognize the signals necessary to create an active asset revesting portfolio. This means they will miss out on the volatility reduction and bear-market profits created by asset revesting.
The Robo Report shows that the returns on investment from traditional roboadvisors such as Wealthfront and Betterment over the last five years (2017 to 2022) have been poor, with an average range of 2% to 5% per year.
The traditional investment strategy (diversified buy-and-hold), which emphasizes purchasing and maintaining positions through volatile market swings, is being replaced by asset revesting. Revesting, on the other hand, sells assets that are no longer appreciating or are starting to decline and exclusively invests in assets that are increasing in value. When compared to the conventional technique, it gives greater and more reliable returns with far less portfolio volatility by forgoing diversification. Asset revesting is a game-changer for investors who wish to optimize their portfolio and reach their financial objectives because it provides the chance to avoid holding declining positions and instead invest in assets that are rising.
The good news is there are alternatives for investors who want an advisorless asset revesting portfolio but who might not know how to analyze market movement to recognize signals. A newsletter service that distributes asset revesting signals for investors to follow and execute is one option. You can also have the strategy autotraded for no additional cost within your IRA, self-directed brokerage accounts, and more, by TheTechnicalTraders.com.