August 27, 2013

Millions of Americans get their investment accounts churned every year. What is this and what can you do about it?

2 thoughts on “August 27, 2013”

  1. Katherine Graham says:

    The goal of brokers is to get you to buy and sell as much as possible (this is called churning). You can avoid this by avoiding brokers and investing in no-load index mutual funds at Vanguard instead.

  2. Mike Finley says:

    Well said, Katherine. Let’s see how this plays out. The broker calls up his victim, I mean client, and tells them that the environment/sector/market/bla, bla, bla has changed so they must sell one investment and buy a different investment. Cha ching! Repeat every few months and years and the broker makes himself a nice living AT THE EXPENSE of his victim, I mean client. This is illegal, but mighty hard to prove. A broker can rationalize almost any recommendation that would cause you to buy and sell your investments.

    Follow Katherine’s advice and avoid brokers. Replace them with YOU as you invest in those boring, cheap and very efficient no-load index mutual funds at a place like It’s that simple.

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