Whether you are a current client or thinking about becoming a Turner Capital client, it is important that all of your questions are addressed to your complete satisfaction. We enjoy talking with our clients at any time and if you are considering us as a manager of a portion of investable net worth, we want you to get to know us, how we conduct our business and most importantly, how we manage client accounts.
Should you want to speak to us, please don’t hesitate to call us at 1-855-678-8200 or simply fill out our contact form.
Q: USING ANOTHER MONEY MANAGER, I LOST SO MUCH MONEY IN THE 2000 AND 2008 BEAR MARKETS THAT I AM AFRAID TO GET BACK INTO THE MARKET. I CANNOT AFFORD TO Suffer through another market crash. I don’t understand how you say you can make me money in a bear market. You must be taking on too much risk or everyone would invest the way you do. Please explain how I don’t have to be afraid of another bear market and not take on too much risk?
A: Most investors (and professional money managers, for that matter) only know one way to make money in the stock market: buy low and sell high. But, unfortunately, far too many times these investors buy high and sell low. Actually, it's even worse than this... far too many investors think the only way to "beat the market" is to buy-and-hold; which is, in reality, "buy-and-hope", where they buy now and 'hope' that someday in the future, if they wait long enough, they will make a profit. This is why you often hear professional financial advisors recommend that you have a 10, 20 or 30 year time horizon. They want to make sure they do not have to justify losses to you by just saying, "I have told you to have a long-term investment horizon." Having a long-term investment horizon is just another way to tell you not to judge their performance based on the one criteria that means the most to you: Return on Investment... Profit.
These advisors typically think of themselves as 'value' investors. Then, as their client's stock shares plummet in price in bear markets, they try to rationalize the debacle by saying the 'value' is still high even when their portfolio is being decimated.
Remember: You can't take 'value' to the bank or to the grocery store. You can't buy/sell 'value'. Your portfolio is worth only what someone will pay you for it in terms of share price of holdings in your account; NOT what you think its 'value' is.
We have a much better approach. We constantly look for and trade for profit. We have little regard for 'value' unless that value is resulting in our client accounts are growing in real value; meaning growing in net asset value... cash profits. This does not mean we do not care for a holding's fundamentals. We only want to hold fundamentally strong stocks in our investment strategies. But, just because a stock has great fundamentals does not mean that is the only reason to buy it or hold it in your account.
As for risk taking... We take far less risk than typical buy-and-hold strategies. We do not hold short positions. We do not trade futures. We do not day-trade. We do not trade FOREX. We do not trade or hold annuities. We do not trade or hold mutual funds.
Every position in a client account has a pre-defined downside exit price, which in worst-case scenarios when a trade moves against us, the loss is generally far less than 3% to 8%.
We buy fundamentally strong, up-trending equities in bull-trending markets and we buy up-trending Inverse ETFs in bear-trending markets. Inverse ETFs are designed to gain in share price as the ETF's underlying index drops in share price. This way, our clients make profits in both bull AND bear markets and at far less risk than in traditional buy-and-hold equity or mutual fund investment strategies.
Q: Where is my account (and my money) held?
A: Currently, we work with one of the largest and most respected brokerage firms in the world: T.D Ameritrade.
Turner Capital Investments, LLC never holds your money or maintains custody of your account at any time. You will open one or more accounts with the above brokerage firm (on their institutional side). Once you have funded your account(s), you will maintain 100% ownership of and control of the account(s).
Simply put, you are hiring us to make trades on your behalf and that is the extent of our ability to access your funds.
You can start/stop our limited trading authority in your account(s) at any time, at a moment's notice; even without contacting us directly. Since the accounts are yours, you can authorize or deauthorize us from having any trading capability in your accounts at any time by just contacting the broker directly.
Q: How often will you provide an update on my account? I don't like getting updates once a quarter?
A: You have 24/7 access to your account. You can log into your accounts on-line and see every trade and the net asset value whenever you desire.
We do not provide you with monthly, quarterly or annual reports since you have complete access to your account(s) at all times.
However, Mike Turner sends out a weekly eLetter to clients letter where he covers our current strategy and his views of the various global and domestic markets, plus an update on our investment strategy for each portfolio.
Q: How easy is it to speak with Mike Turner if I have a specific question about my financial situation?
A: Mike is our Chief Investment Officer and President of the company. His time is limited, but he makes it a point to respond to any client in a very expeditious timeframe. Mike wants all our clients to know he is very responsive to any request for a personal consultation.
Q: What are your management fees?
A: The fee TCI charges for actively managed accounts is negotiable on a client-by-client basis and is predicated on the relationship TCI has with the client and the total assets under management. The TCI management fee, as stipulated below, shall not exceed 3% or the maximum allowed per client’s state of residence, whichever is less. The fees and expenses in connection with these advisory services may be higher or lower than the cost of similar services offered through other financial firms or the fees associated with other financial services.
Our wrap fee includes all of the normal costs associated with managing the account including strategy management fees, trading costs, and reporting requirements. The brokerage services may require the client to pay costs directly to the custodian of the client’s account in addition to TCI’s fee in every respect with regard to trades and transaction costs, wire transfer and electronic fund fees, custody fees and other administrative fees, and taxes on brokerage accounts. Exchange traded funds also charge internal management fees, which are disclosed in a fund’s prospectus. Such charges, fees and commissions are exclusive of and in addition to TCI’s fee, and TCI shall not receive any portion of these commissions, fees, and costs.
A minimum of $50,000 of assets under management is generally required to invest in an account managed by Turner Capital Investments, LLC. The minimum investment amount may be negotiable under certain circumstances, including the total relationship with Turner and the size of the account(s).
Q: My current manager only charges me about 1.5%, but you want to charge me more. why should i pay you more?
A: First, let's make sure we are comparing apples-to-apples. Here is everything that is included in our "wrap" fee:
- You do NOT pay for trade transactions. Our broker charges us (Turner Capital Investments) for trade transactions. Many managers will charge a lower management fee because they can bury or hide this cost and if questioned will typically say, "Every brokerage firm charges for trade transactions." That is true, but it is up to the manager to pass that fee to you or pay that fee out of his/her management fee.
- Our management style is very tactical and actively managed. This means we move your account into and out of various aspects of the market depending on how the market is trending. Our average hold-time for most positions is generally three to six months, although we may hold a position for well over a year if it stays on trend.
- If we do not earn you a greater return than what you would get with a lower fee firm in both bull and bear markets, then we would certainly understand if you decided to not use our services. However, we believe you will find that our fee is very low in comparison to the return you will be receiving.
Q: I AM CONCERNED ABOUT HAVING TO PAY CAPITAL GAINS ON SOLD POSITIONS. DOES YOUR TRADING STRATEGY FAVOR A LONG-TERM CAPITAL GAINS TAX STRUCTURE?
We do not manage our accounts based on capital gains considerations. It is more important to us to have realized profits than to risk that profit for what could be a lower capital gains tax. Also, many of our clients have us managing tax-deferred accounts so capital gains taxes are not an issue.
Q: I HAVE A trust, a ROLL-OVER IRA, A TAXABLE ACCOUNT and a health savings account. CAN I GIVE YOU all OF THESE TO MANAGE?
Yes, our strategies are tax-deferred-friendly, including individual, joint, retirement, trust, health savings accounts and trustee. We can get into the specific structure of matching your financial requirements with the best strategy when you are ready for a personal one-on-one phone call.
Q: YOU SAY THAT IN BEAR MARKETS, YOU'RE GOING TO PUT ME INTO SOMETHING CALLED AN INVERSE ETF. WHAT IS AN INVERSE ETF?
An inverse ETF is an exchange-traded fund that is constructed by using various derivatives for the purpose of profiting from a decline in the value of an underlying benchmark. This means, for example, an inverse ETF of the S&P 500 (Ticker: SH) tends to move higher as the S&P 500 moves lower. Buying a long position in an inverse ETF is similar to shorting the underlying benchmark, but one advantage is that inverse ETFs do not require the investor to hold a margin account as would be the case for investors looking to enter into short positions. This gives us the ability to "short" the market without actually executing a short position.
Q: I HAVE HEARD THAT INVERSE ETFs ARE RISKY AND ARE HIGHLY LEVERAGED. IS THIS TRUE?
Buying and selling any stock or ETF in the stock market is not without risk of loss, regardless of the stock or ETF. It is important to understand that if we place an inverse ETF in your account, it can move up or down in share price. According to the SEC, inverse ETFs seek to deliver the opposite of the performance of the index or benchmark they track. Like traditional ETFs, some leveraged and inverse ETFs track broad indices, some are sector-specific, and others are linked to commodities, currencies, or some other benchmark. Inverse ETFs often are marketed as a way for investors to profit from, or at least hedge their exposure to, downward moving markets.
Most inverse ETFs “reset” daily, meaning that they are designed to achieve their stated objectives on a daily basis. Their performance over longer periods of time -- over weeks or months or years -- can differ significantly from the performance (or inverse of the performance) of their underlying index or benchmark during the same period of time. This effect can be magnified in volatile markets.
Turner Capital Investments does NOT generally use highly leveraged or "ultra" inverse ETFs. We focus our inverse ETF investments on 1x inverse ETFs of broad-market and sector benchmarks, and will on occasion, invest in highly liquid commodity indexe (both regular and inverse) ETFs that focus on oil, natural gas, gold, silver, etc.