The Ledger
Every statement that passed quotation and attribution checks. Mix any filter with any other: certainty 1/5, debate potential 5/5, or both at once.
why aren't all 18 resolved? a statement only gets an assessment when the public record can support or contradict it. opinions and what-ifs never can, and 0 checkable ones are still open, waiting for their date. predictions held up or didn't; assertions are supported or contradicted. on every card: ▮▮▮▮▮ certainty · ▮▮▮▮▮ debate potential. speakers are clickable
Egan: Many professional investors enjoy investing personal capital as entertainment
“I think that's where a lot of professional investors, they enjoy the doing more than they care about the outcome of it.”
Egan: Searching for manager alpha is only worthwhile with millions in assets
“However many hours you spend trying to find the right manager, or trying to find the right strategy and understand what this stuff is doing, is not well spent unless you already have a very, very large asset base. I'm talking in the millions, at least.”
Egan: Betterment employs human advisors primarily to study and automate their jobs
“In the longer term, to be clear, We are going to keep automating a large part of that. So it is not simply a matter of, oh, we hit some brick wall and we had, you know, we ended up having to use advisors. Every single financial planner or licensed expert on ou…”
Egan: Saving $33 more monthly matches 1% annual manager alpha for averages
“He basically found that for that person, in order to, if that person went with finding out how to, you know, save more or invest more, rather than pick the better manager, they would need to save something like 33 more dollars per month. So, that's the trade-o…”
Egan: Betterment Aims to Be First Fiduciary Advisor to IPO
“I think that's, in the long run, what we see ourselves as being, is The first company that goes public off the back of being a fiduciary advisor rather than a broker or mutual fund company.”
Egan: Tax loss harvesting is most valuable during an investor's first decade
“So strictly speaking, the value of tax loss harvesting grows over time monotonically, but it is convex. So the tax loss harvesting you do the first sort of 10 years of your life will be the most valuable tax loss harvesting you ever do. It will continue to be …”
Egan: Marginal gains from over-optimizing rebalancing methodology are very low
“The marginal gains from thinking about rebalancing too much are really low. As long as you think about, like, the tax component of it, and you're not letting your asset allocation get crazy, You're fine. If it's daily, quarterly, monthly, annually, drift-based…”
Egan: Personal investing lacks accountability because investors cannot fire themselves
“Giving advice and being responsible for somebody else's money is different than what you do with your own. So I know people who have made bets on Bitcoin or various other things that lost tons of money, and if they were an advisor, they would be fired, but you…”
Egan: Only 5% of Investors Demand Deep Technical Due Diligence
“I would say five percent of the population is going to be a sophisticated investor, and they want to know how we do it, and how we calculate the benefit, and everything that you would think is sort of good due diligence on it. The other 95% of people want to t…”
Egan: Behavioral Finance Knowledge Does Not Stop Irrational Decision-Making
“It doesn't stop you from having all of those issues. It doesn't stop you from making irrational decisions. It doesn't make you some sort of super rational person. It just does give you a framework of saying, okay, this is why this is happening. This is how thi…”
Egan: Non-Professional Investors Suffer From Poor Feedback Loops
“The vast, vast majority of investors, unless you're in a professional shop, you have a very low quality feedback loop about how well you're doing. The only people who have really high quality feedback loops are professional PNs, sometimes analysts, who get lik…”
Egan: Betterment tax impact previews reduced trade completion rates by 70%
“And what we found was that if we showed them a positive tax number, they were about 70% less likely to go through with a transaction. If you look at transactions that would have incurred 50 dollars or more in taxes, the completion rate was somewhere around eig…”
Egan: In-app crisis popups reduced negative investing behaviors by 15% at Betterment
“And we found that that simple, easy thing to do, just a pop-up notification, reduced the bad behaviors by about 15% and increased deposits by about 10 or 12%.”
Egan: Wealth platforms must build for 5% of experts to win 95%
“The 95% of normal people, they're asking the five percent of people who they should use. So you can't simply say, oh, well, we'll just target on the 95%. You actually have to provide the transparency and knowledge for the five percent of sophisticated people t…”
Egan: Betterment will not make capacity-constrained hedge funds a core offering
“I don't foresee us Making that a core part of our value prop. If only because our mission is to democratize a lot of the higher end wealth management things. And those are almost always capacity constrained or exclusivity plays, right?”
Egan: Excitement about an investment is a warning sign for investors
“If you're excited about what you're investing in, you should worry. Right? If you're kind of like, oh, I'm doing this thing, it's pretty standard, you know, like, it's not very exciting, you're gonna stick with it. You don't, you're not motivated to monitor it…”