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Titan launches its mobile ‘not a hedge fund’

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Re: Titan launches its mobile ‘not a hedge fund’

#11

Post by [deleted] »

aml183 wrote: post #7
MrMember wrote: post #3

The average person is much better off putting their money in a whole market index fund that charges a tenth of a percent (or less) rather than a managed fund that charges 1%. The managed fund is unlikely to outperform the index fund in the long term.

I disagree. It's very unclear what strategy will work over the next 20 years. Many people are bullish on index funds because research has shown that they outperformed managed funds over the past 10-20 years. It doesn't mean they'll outperform over the next 20 years. Past results are no indication of future results.

[deleted]

Re: Titan launches its mobile ‘not a hedge fund’

#12

Post by nostromo »

aml183 wrote: post #7
MrMember wrote: post #3

The average person is much better off putting their money in a whole market index fund that charges a tenth of a percent (or less) rather than a managed fund that charges 1%. The managed fund is unlikely to outperform the index fund in the long term.

I disagree. It's very unclear what strategy will work over the next 20 years. Many people are bullish on index funds because research has shown that they outperformed managed funds over the past 10-20 years. It doesn't mean they'll outperform over the next 20 years. Past results are no indication of future results.

> Many people are bullish on index funds because research has shown that they outperformed managed funds over the past 10-20 years.

According to John Bogle, this has been true for over 100 years. His analysis goes back to 1900.

Re: Titan launches its mobile ‘not a hedge fund’

#13

Post by toomuchtodo »

Bedon292 wrote: post #10
wyldfire wrote: post #6

Earlier quoted context omitted.

I would go beyond that and say that the average person should use those retirement date targeted funds. Those are usually cheap and minimize risk towards your retirement date.

While that is what I have mostly done, the retirement date funds I have had access to tend to have significantly hire fees (sometimes close to double) compared to the index funds. Not sure their performance actually justifies it either.

Is this through a 401k or through individual IRA/investments accounts? If the latter, I'd suggest moving to a provider such as Vanguard, with very low expense ratios [1]. If through your 401k, I would suggest encouraging your employer to seek out options where you're not overcharged (preferably as a group of employees, as there is strength in numbers). Failing that, max out your 401k with just enough funds to obtain the full employer match, then fill your IRA(s), and then your taxable accounts.

[1] https://investor.vanguard.com/mutual-funds/profile/VTIVX (example fund, Vanguard Target Date 2045 fund, 0.15% expense ratio)

Re: Titan launches its mobile ‘not a hedge fund’

#14

Post by Bedon292 »

freeone3000 wrote: post #8
Bedon292 wrote: post #5

Earlier quoted context omitted.

It specifically says they invest in your name and pick shorts based on your risk profile though, which is where I got confused. It is not pooling everyone's money together. So not sure how it actually can hedge with such a small amount of money.

Based on the article, they use holdings of the same 20 stocks, and seem to adjust risk exposure by varying the percentage of short-sell. Their Program Brochure[1] backs this up - you get fractional stock as part of an investment pool in the 20 stocks they choose, instead of entire shares, so you get the same relative hedge you would otherwise. They do mention direct ownership, but it's fractional shares still held th…

On their FAQ: "Is Titan a hedge fund?: No. You are not investing in a hedge fund. Hedge funds pool their investors’ dollars together and each investor is treated the same. We keep your money in your own individual account and personalize this based on your risk tolerance and investment goals. Titan invests you like an active manager, with the personalization of an advisor in your pocket."

I could definitely not be understanding what they are saying, but it does say they are not pooling.

https://www.titanvest.com/faq/

Re: Titan launches its mobile ‘not a hedge fund’

#15

Post by Hasz »

1% of capital every year is crazy money.

If the fund is really that good, they'll take x% of the profits and not charge a fee on capital. You take capital because you're not really that good, and you don't know (like basically everyone else) what's going to happen.

Funds know they can't reliably beat the market, and thus don't offer such structures.

I want a ratcheting fee structure. No capital fees, and no fee if the fund loses compared to its benchmark. The fund only makes money if it beats the benchmark.

Re: Titan launches its mobile ‘not a hedge fund’

#16

Post by Bedon292 »

toomuchtodo wrote: post #13
Bedon292 wrote: post #10

Earlier quoted context omitted.

While that is what I have mostly done, the retirement date funds I have had access to tend to have significantly hire fees (sometimes close to double) compared to the index funds. Not sure their performance actually justifies it either.

Is this through a 401k or through individual IRA/investments accounts? If the latter, I'd suggest moving to a provider such as Vanguard, with very low expense ratios [1]. If through your 401k, I would suggest encouraging your employer to seek out options where you're not overcharged (preferably as a group of employees, as there is strength in numbers). Failing that, max out your 401k with just enough funds to obtain…

Employer 401k, I think my current one is 0.39% for target 2055. I hate it, but doesn't seem to be interest in changing. I think I will push for it again soon though.

Re: Titan launches its mobile ‘not a hedge fund’

#17

Post by Bedon292 »

Hasz wrote: post #15

1% of capital every year is crazy money. If the fund is really that good, they'll take x% of the profits and not charge a fee on capital. You take capital because you're not really that good, and you don't know (like basically everyone else) what's going to happen. Funds know they can't reliably beat the market, and thus don't offer such structures. I want a ratcheting fee structure. No capital fees, and no fee if th…

That would be awesome as an investor, but is that actually sustainable? I guess if the benchmark looses money, and they loose less they get to take a % of something? But they you are paying them for having lost money? Seems odd. I think I don't mind a minimum fixed %. Though as you say, 1% is pretty high still.

Re: Titan launches its mobile ‘not a hedge fund’

#19

Post by yellowstuff »

Bedon292 wrote: post #2

This looks very interesting. Has anyone here used it yet? And does hedging really work with such low numbers? I thought the point of hedging was being able to spread the risk across lots of large investments. Can you really spread enough with only $1000?

You seem to be using the term "hedging"(https://www.investopedia.com/terms/h/hedge.asp) but describing something more like "diversification (https://www.investopedia.com/terms/d/diversification.asp).

From the article it looks like Titan buys 20 stocks, and every Titan investor gets the same stocks in the same proportions, in an amount determined by how much they invested. The "hedging" part is that Titan also buys a product that makes money when the stock market goes down, and gives different amounts of that to each investor based on their risk tolerance. While it is possible to buy downside protection in small amounts, I assume that Titan essentially buys it wholesale and splits it up among its investors, rather than going to the market and buying small amounts with a separate transaction for each investor.

Re: Titan launches its mobile ‘not a hedge fund’

#20

Post by jorblumesea »

Hasz wrote: post #15

1% of capital every year is crazy money. If the fund is really that good, they'll take x% of the profits and not charge a fee on capital. You take capital because you're not really that good, and you don't know (like basically everyone else) what's going to happen. Funds know they can't reliably beat the market, and thus don't offer such structures. I want a ratcheting fee structure. No capital fees, and no fee if th…

It is pretty competitive compared to most other actively managed funds. Hedge funds sometimes take incredible performance fees, advisory fees, etc. They can amount to 2-4% off the top.

Not saying I agree with it, but it is well priced for the space.

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