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Wouldn't this only work if you had all your mutual fund investments with T. Rowe Price? They're not going to devise a plan that incorporates your holdings at Oakmark or Oppenheimer - are they?
Great post. I can see the benefits to those who keep all or most of their assets with Price. And a great company. But, frankly, I'm under-impressed. As far as automatic rebalancing, their Spectrum and other fund-of-funds do that now.
I've never understood what the difference is between services like this (offered by TRP or any other fund family at no cost) that allocates among house funds, and asset allocation funds (e.g. TRP's Spectrum funds). They are all managed portfolios along a risk/reward axis, and based on a questionnaire you pick the one that matches your objective.
For that matter, I don't see the conceptual difference between this and something like Fidelity's Portfolio Advisory Services. Services like those also effectively offer pre-packaged portfolios that they pair you with based on objective and risk. This variant uses funds across many families. It makes its profit by charging an extra fee instead of relying on the management fees of underlying house funds. But otherwise, it too seems similar.
Programs like these may offer other features such as tax management. But then so can allocation funds, e.g. VTMFX.
Not a bad idea for TRP folks wanting a hands-off approach - I own a few of their funds and think they're one of the better no-load fund companies out there. But I agree with the poster who wonders why this is any different/better than going into one of their balanced or T-D funds.
To TRP's credit, there's no extra advisory fee other than the ER of the funds you're put into via the program's allocation, which is a neat twist. However, I don't like allocations of anything that don't contribute meaningfully to a portfolio -- so while you have exposure to (say) 15 different asset classes, if 7 of them are in the 3-7% range allocation in the account, I think that's a useless allocation and not something I'd do myself. Thankfully, you can 'blacklist' funds to somewhat pre-approve your asset class exposure, which is a nice thing.
I don't see a need for this service, but from what I see, I commend TRP for how it's offering it.
Sounds like the TRP version of a robo-portfolio. There shouldn't be an advisory fee if they are using their own funds. Sounds much like the Schwab robo I use. No fees other then the use of their ETFs.
Probably a good idea for many. Wonder how it differs from their Target Date funds.
Comments
Wow...impressive:
They're not going to devise a plan that incorporates your holdings at Oakmark or Oppenheimer - are they?
Great post. I can see the benefits to those who keep all or most of their assets with Price. And a great company. But, frankly, I'm under-impressed. As far as automatic rebalancing, their Spectrum and other fund-of-funds do that now.
I've never understood what the difference is between services like this (offered by TRP or any other fund family at no cost) that allocates among house funds, and asset allocation funds (e.g. TRP's Spectrum funds). They are all managed portfolios along a risk/reward axis, and based on a questionnaire you pick the one that matches your objective.
For that matter, I don't see the conceptual difference between this and something like Fidelity's Portfolio Advisory Services. Services like those also effectively offer pre-packaged portfolios that they pair you with based on objective and risk. This variant uses funds across many families. It makes its profit by charging an extra fee instead of relying on the management fees of underlying house funds. But otherwise, it too seems similar.
Programs like these may offer other features such as tax management. But then so can allocation funds, e.g. VTMFX.
Not a bad idea for TRP folks wanting a hands-off approach - I own a few of their funds and think they're one of the better no-load fund companies out there. But I agree with the poster who wonders why this is any different/better than going into one of their balanced or T-D funds.
To TRP's credit, there's no extra advisory fee other than the ER of the funds you're put into via the program's allocation, which is a neat twist. However, I don't like allocations of anything that don't contribute meaningfully to a portfolio -- so while you have exposure to (say) 15 different asset classes, if 7 of them are in the 3-7% range allocation in the account, I think that's a useless allocation and not something I'd do myself. Thankfully, you can 'blacklist' funds to somewhat pre-approve your asset class exposure, which is a nice thing.
I don't see a need for this service, but from what I see, I commend TRP for how it's offering it.
Probably a good idea for many. Wonder how it differs from their Target Date funds.