This is Warren Buffett’s ‘first rule’ about investing. Here’s what to do if your financial adviser breaks that rule
Of course, your financial adviser isn’t always going to be able to follow that rule — the markets do go down, and nobody beats the market every time, even Buffett himself — but when they do lose you money, how do you know when to pull the plug? “Some brokerage firms may include a target portfolio as part of their statement or a financial adviser can likely include it in a client’s portfolio review,” says Lam-Balfour. Additionally, you can use a benchmark like the S&P 500 but you will likely need to do a weighted average of one or more indices because a diversified portfolio will not be 100% invested in the S&P 500.