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A Comment on All-ETF Portfolios

All,
I have been following the post and need to respectfully disagree with the statment "If you have a lot of money and you are paying for advice I think you should be getting more than just ETFs"

I agree that anyone paying for advice should be getting other services in addition to investment management. This could include advice on real estate transactions, insurance, financial and estate planning, and other areas.

However, if the author is suggesting that ETF's alone cannot make a complete and total portfolio solution, then he/she is off base. Further, a statment such as the one made did not quantify the amount being paid for the advice so it would be difficult to judge the value. I believe the author is suggesting that individual stocks should be included in a portfolio to justify an unnamed fee structure.

It is my opinion that individual stocks should be included if they are in an area where the manager has an extremely high level of conviction, and the client has a tolerance for the risk associated with individual stock ownership.

Regardless of the need, or the level of fees or the size of a portfolio; indexing can present a total solution and ETF's are now of sufficient quantity to cover every core asset class. Academic work in the area of portfolio returns has concluded that it is asset allocation rather than security selection which determines portfolio results.

All the best, thank you for allowing my post.

Regards,
Herb Morgan
Chief Investment Officer
Efficient Market Advisors, LLC
San Diego, CA