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Anthony Layton MBA, CIM

Chairman & CEO, Portfolio Manager

Peter Guay MBA, CFA

Portfolio Manager
Contact
  • T514.875.7566 x 224
  • 1.800.875.7566
  • F514.875.9611
  • Place Alexis Nihon
  • 3400 de Maisonneuve Ouest,
    Suite 1501
  • Montreal, Quebec H3Z 3B8
September-24-15

Are You Ready To Become a “DIT” Investor

We’ve all heard of the DIY or Do It Yourself approach. Whether it’s building a new deck or changing the oil in your car, DIY can be rewarding … as long as it’s an activity you enjoy. When it comes to managing your finances, I prefer a DIT or Do It Together approach.

What do we mean by DIT Investing?

If you’re like most people, you probably want to know where you stand financially. You want to feel confident that you have enough money to support your lifestyle for the long run. Or, if you’re not there yet, you want to know how to get there.

While these end goals are worthwhile, you probably aren’t excited about the details along the way. Over time, your life and financial interests can grow increasingly complicated. You may question the investments and choices you’ve already made, but be unsure about when, how or even if you should make adjustments. This can suck away hours and energy that could be spent on far more rewarding activities.

The concept of DIT Investing makes sense. It’s that sweet spot where you’re an integral participant in managing your money, but you share the burdensome and/or perilous parts with a professional advisor.

DIT Investing in Action

As a DIT Investor, instead of flying solo, you partner with a professional advisor who has your back whenever your own time, ability and – let’s face it – patience may fall short. But you also remain fully engaged in your investment experience. You’re not just a rubber stamp to somebody else’s rules:

  • You learn what you need to know to invest sensibly over time, so you can stay on course through volatile markets and across the years of accumulating, investing and spending your wealth.
  • You are familiar with your assets, so you can make the most of opportunities that come along.
  • You are on top of your life’s challenges, so you can minimize any damage done by unforeseen events.
  • Most important, you have defined your investment goals, you are keeping them relevant over time, and you are proceeding according to a practical plan that you have been part of developing.

The Data on DIT Investing

There’s hard data on the value a DIT relationship can bring you. In 2013, Vanguard® published an analysis of “Advisor Alpha” as a measurement of “the experience and stewardship that the advisor can provide in the relationship.” The analysis concluded: “A financial advisor has a greater probability of adding value, or alpha, through relationship-oriented services, such as providing cogent wealth management and financial planning strategies, discipline, and guidance, rather than by trying to outperform the market.” In follow-up work to its original paper, Vanguard’s analysts found advisors could potentially add as much as 3 percent to investors’ end returns by serving in these and related roles.

We’re in This Together

So, what are the qualities of a “Do It Together” approach that contribute to an improved investment experience? What are the details that matter? Equally important, which are the ones you can safely ignore, so you can get on with the fun part of living? Beginning with today’s post, I will explore the many ways that DIT Investing can add value to your and your family’s financial future.

Please “follow” me to participate in the series. Better yet, pass it on! 

By: Peter Guay | 2 comments