All Over Town
You’re diversified…you have advisors all over town! Or, you have 100 different mutual funds! Sorry to break the news to you but that isn’t how it works!
Just because you have accounts all over the place doesn’t mean that you are diversified. The only way you can truly tell if you are diversified is when you look at your portfolio in a whole and assess which companies you own, including looking at your mutual funds and seeing which funds overlap in their holdings.
If you have several advisors then you need to inform each advisor about what you own outside of the investments you own with them. If they aren’t asking you, then shame on them. In order for your advisors to properly recommend investments, they should be aware of what you already own in order to reduce your risk by increasing your diversification.
If you don’t feel comfortable telling your financial advisor what you own, then you shouldn’t be buying from them. It’s like going to see your doctor – if you don’t tell your doctor all your symptoms, then they can’t accurately help you. If you don’t feel comfortable with your doctor, then it’s probably time to find a new one.
So, unless you know the intricacies of everything you own, you may want to find an advisor that you trust so you can consolidate your accounts and ensure your diversification. At the very least, handing your advisors a list of the investments you own and any changes that occur is smart.
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