We estimate that retail investors lose around $400 billion annually in advisory fees and inefficient model portfolios. This value destruction is both explicit in typical 1% or higher fees charged and implicit in further 0.5% or more model portfolio asset allocation inefficiency. This is in addition to other contracting frictions, product commissions and costs.
At ActiveAllocator we are driven by an authentic mission. To increase expected returns for millions of investors by eliminating the loss that’s built into the way the retail financial advice and investment management industry is currently structured. To remove the dead-weight costs of $130 billion from strategic asset allocation inefficiency and to drastically reduce the $260-$300 billion in advisory fees. One portfolio at a time, across 33 million individual portfolios.