QUESTION:
I don’t know much about investing so I hired a broker with a well-known brand name. When looking at my account, I notice she sells and buys a lot every year. For instance, between March 2018 and March 2019, she sold and bought small shares (100) over 50 times in just one of my IRAs. Besides my minimum required distribution (I’m over 71 years old), there wasn’t much growth in the account to show for it. Is she just making money on the trades and not performing with growth in the account? I don’t know enough to understand and don’t want to be unfair by moving the account without researching. It seems that other brokers always disparage what someone else is doing to get the business.
Although that does seem very excessive, without more evidence, it would be unfair for me to suggest that your broker is squandering your returns by generating unnecessary trading commissions. Get an aggregate of all fees, commissions, and other costs for your account and compare to your account balance. If it is excessive (>1% of your balance), perhaps look elsewhere. Also, keep in mind that, besides simply generating fees, timing the market or turning over stocks/funds frequently to pursue outperformance is usually detrimental to your returns. Asset allocation and discipline in the long term can instead help your odds of success.
A fee only fiduciary investment advisor may be able to provide you with a second opinion. We work in the best interest of the client and get paid only by the client, never by commissions. This means that you are paying for our advice. Good luck.