No. of Recommendations: 1
Hi -- new to this board!

I currently have a personal financial manager at a major brokerage managing my bond portfolio, which is made up of tax-free muni bonds.

I have been successfully managing my own stock portfolio for several years and am weighing my options for also taking over my bond portfolio in order to avoid the brokerage fees, which are currently .5% of my portfolio value annually. So my most fundamental question is whether I can hope to match my portfolio manager's performance by within .5% -- in other words, does his superior experience, and access to new bond issues not available on the secondary market warrant this .5% fee.

Obviously, measuring his skills and my own likely acumen is hard to quantify -- and it does seem to me that bonds are more difficult to manage than stocks? -- but let's say I turn out to be a decent bond investor.

My question: to what extent does the professional manager's access to the primary market (is that the right term? I have in mind the brokerage participating in the float of new bond issues) constitute an advantage that helps to "earn" that .5% fee?

1)Is he able to get better interest rates on bonds for me because he has access to these offerings, where I would have access only to the secondary market?


2) Is there also a negative here, in the sense that he needs to get these bond issues *sold* and so he may be putting me in these bonds that his brokerage is floating from time to time, instead of getting me a better deal on the secondary market? If so, this would seem an additional reason I'd be better off doing it myself . . .

Comments and related observations about the pros and cons of enlisting (and paying for) such a manager are appreciated.

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