What is the big difference between investing with GFM vs investing with any of the other financial advisors and brokers in the large financial services industry? This was the question I aimed to answer in a single picture.
In short, I aim to make investing as direct and simple as possible. In the below picture, I aim to illustrate the difference between how many individuals have traditionally invested (on the right), vs how investing with GFM works (on the left):
- Traditionally, many investors do not have the time, interest, or expertise to directly pick stocks or bonds, so many would buy mutual funds from an asset manager (like Blackrock), buy an investment-linked insurance product, or simply have investments through their pension (which has a trustee / management fee). The mutual funds or investment-linked insurance products are often sold through commission-based advisors or brokers, who of course need to get paid a fee, which traditionally was not disclosed.
- Mutual funds manage a pool of investments for large numbers of investors and of course have a management fee. Mutual funds have large costs, including legal fees (to set up the fund, issue prospectuses, etc.), and audit fees.
- Mutual funds also typically set themselves up with large, relatively high cost prime brokers and custodian firms, who collect another layer of fees.
- Ultimately, all these layers of fees and complexity simply invest your money in the same stocks listed on the same stock exchanges where you could have bought them directly.
GFM’s managed account approach greatly simplifies this by directly managing each account in the individual’s name, and charging only one simple and transparent layer of fees.
Leave us a message below if you have any questions about how we can simplify how you invest globally.