T2 Asset Management, LLC
As a Managing Principal and Portfolio Manager, Dan Timotic's focus is to help clients achieve their financial goals. He works closely with clients to understand their current financial situation, evaluate their current investments, and make recommendations to better allocate their portfolio based on their risk preferences.
Prior to founding T2 Asset Management, Dan held various positions at some of the largest investment firms in the country as a trader, portfolio manager, and strategist. With over 20 years of professional experience, he has managed billions of dollars for institutions, endowments, foundations, pension plans and individuals.
Dan received his MBA in Finance from DePaul University. He is a Chartered Financial Analyst and a member of CFA Institute as well as CFA Society of Chicago. Dan also serves as a member of the St. John of the Cross School Advisory Board in Western Springs, Illinois.
MBA, Finance, DePaul University
Assets Under Management:
I try to encourage young investors to use ETFs. There are many types of ETFs ranging from broad index to sector specific to alternatives. I prefer to own a basket of stocks in a sector I fundamentally believe in. Diversification can take many forms. You can diversify within a sector or a market. Many studies have been done over the years and they all point to the same conclusions. Asset allocation is by far the bigger contributor to your returns rather than stock picking. Spend more of your time on the asset allocation and you should be in better shape later on.
It's great that you're taking control of your finances and interested in investing. A good starting point is to put an amount in an account that you are comfortable with and dollar cost average going forward. DCA will allow you to systematically contribute to your account. As for the type of account, it depends on what you're saving for. The Roth IRA is a retirement account. If you should need the money prior to 59 1/2, the IRS could impose a premature withdrawal penalty on you. If you're unsure, speak with an advisor to get your accounts set up according to your future needs.
This is a great question. The internet has completely changed the way individuals invest. Some of this change is positive and some is negative. The amount of information available today is significant relative to how it was when I first started in this business. I think the broader issue for investors is how to analyze this information. With all the technology available to us, we have become accustom to immediate gratification in everything we do. This need for immediate results can have harmful effects for investors.
As someone that has spent over 20 years in the investment management business, I have seen the ups and downs of individuals thinking they figured it out. I remember the days of the tech bubble when people were quitting their jobs to day trade. We all know how that ended.
In general, I am always in favor of more information. However, the consumption of information is just that. How you interpret, analyze, and implement your ideas is what really matters. It's a lot like WebMD. You can go on their website and self-diagnose yourself, but it's probably a bad idea. It's probably better to go see the doctor. Remember, we all have access to the same information. The difference is there are professionals that have spent many years of education and training to better analyze this information.
On a positive note, the fact that investors are being proactive and learning about different industries and economies can help them frame some ideas about how they would like to invest. This can be a great starting point for individuals as they meet with their advisor and implement an investment strategy. I try to remind individuals to ignore short-term noise and focus on longer-term investing. The markets will go up and down, but as individuals, you need to focus on your personal goals and use the information you find within the context of those goals.
Working with a professional can help individuals look through the noise of the media, friends, and other so-called experts. The media, and the internet for that matter, like to sensationalize a lot of things. Always remember, if they had all the answers, they wouldn't be sitting there giving out their secrets.
Banks have offered fixed rate loans for a long time and I expect them to continue to do so regardless of the interest rate environment. Banks make their money by borrowing on the front end of the yield curve and lending on the back end of the yield curve. The difference in the rates is where they derive their income from. If you are looking to make an investment in real estate, ask yourself why, for what reasons, and what your expectations are. Real estate is illiquid, so if you ever need to sell in a hurry, you probably will have a tough time. As for bubbles, that's a tough one. Depending on where you live, some areas haven't fully recovered from the banking crisis of 2008 so it's difficult to make a general statement about the sector.
This is a very sensitive topic, but if you plan on taking this relationship to the next level, you should both be aware of each other's finances. When a couple decides to make a big decision like moving in together, each person deserves the right to know what they are getting into. Being open about each other's financial situation can prevent future disagreements about budgeting and meeting the needs of the family. This street goes both ways, so you should also share your financial situation with her.