Choice = Returns
My wife has two RSP accounts – one with me through Worldsource Securities here at MatRx Financial and a newer one through an Insurance firm at her place of employment. We maintain the latter because of the matching contribution program that is offered. I was recently reminded of the enhanced returns that can be attained with a broader range of investment options.
The Insurance firm is confined to offering a defined group of generic mutual funds from the larger fund companies. There isn’t any assistance offered that would enable an investor to pro-actively manage these if they chose to do so. However this is not a concern for me since I am in the business. I check these funds for her on a quarterly basis and re-allocate money as best I can given the limitations. Despite my best efforts the four funds that I had selected produced a return of only 11% for the twelve month period of Nov 1/06 to Oct 31/07.
Many would be very happy with 11%, but outside the world of mutual funds lays many other opportunities. Although I was following the same investment strategy in the MatRx portfolio, there were many more options available to maximize profits. We were able to access niche money managers, individual stocks, index products, and lower cost closedend funds. For the same twelve month period her return was 21.1%.
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