True Contrarian Investments LLC
Steven Jon Kaplan began TrueContrarian.com in August 1996 as a weekly blog and later expanded this to a daily newsletter with intraday updates in February 2006. He has been trading his own account, and those of family and close friends, since 1981, and handles separately managed accounts for qualified clients. As a registered investment advisor, Steve charges a 20 % performance fee on net profits and no management fees. He has been quoted in Barron's, Market Watch, Dow Jones Newswires, Seeking Alpha, Kitco, and elsewhere and has appeared on Market Watch cable TV with Stacey Delo.
Steven's goal is to identify those assets which are farthest away from the best estimates of their realistic fair-value levels. This is done through designing algorithms which examine the most reliable signals in the financial markets. These include insider buying relative to selling; investor inflows and outflows; media and advisors' sentiment; and intraday behavior especially near multi-decade tops and bottoms. He studies historical interrelationships to mathematically identify which divergences from typical behavior are pointing the way toward essential trend changes.
Steve enjoys running with the New York Road Runners Club, composing and performing on piano and voice, writing stories, and traveling to unique places. He enjoys hearing from anyone about a wide range of topics, so please let him know what you think about the web site or whatever is on your mind. You can find his music on ReverbNation.
BES, Electrical Engineering and Computer Science, The Johns Hopkins University
Assets Under Management:
20% of net profits; zero management fees.
That sounds like a simple question but the answer is quite complicated and has been the basis for many lawsuits and legal judgments. It varies enormously from state to state and the gray areas are wide. Usually, assume that creditors can seize your retirement savings, and that IRA accounts are easier to seize than employer plans like a 401(k), 403(b), or 457. If the creditor is the IRS then they can seize all of the above and more. Private creditors have far more restrictions but it depends upon the terms of your relationship with them. Usually it is much easier for a creditor to collect in a situation where they are the lender and you are the borrower with promised periodic loan payments where you didn't follow the written payment schedule, or where they are the landlord and you didn't pay your rent according to a written lease. It is harder for someone to collect in a business dispute of any kind or when any arrangement involved non-written agreements.
You didn't say how many children your have or whether you have any grandchildren. If you want, you can give up to 15 thousand dollars per person per calendar year without filling out any paperwork or paying any gift taxes. You can do that immediately without having to wait until you die.
If you prefer to wait then if you are still working you should put the maximum $6500 into a Roth account each year and $6500 for your spouse. If you give your children, grandchildren, friends, or others Roth accounts then they can grow them tax-free throughout their lifetimes. They would only have to make a small annual withdrawal based upon their life expectancy according to the IRS table. The younger the recipient, the longer they have to grow it tax-free. Be sure to list a specific beneficiary or a set of beneficiaries for each of your accounts.
If you have any non-Roth retirement accounts then you should be gradually shifting them into Roth retirement accounts. Otherwise your heirs will have to pay taxes on all money withdrawn from your traditional IRA or 401(k) or 403(b) accounts which makes them much less valuable. You can convert whichever amount each year that will not put you into too high a tax bracket.
A defined benefit plan is much better for an employee, since you know exactly how much money you will get in a pension. With a defined contribution the employee has to decide how to invest the money which requires difficult decisions, and you have no idea how much it will be worth one or five or ten years in the future.
From an employer's point of view, the defined contribution plan is much better since it removes the fiduciary investment responsibility of the employer. That is why, since the law was changed in 1981 to permit defined contribution plans, most employers have switched to it. It removes the employer's responsibility and switches it to the employee.
Paying a performance fee is definitely illegal by SEC rule 205-3 which specifies that this is permitted only for qualified clients with a total net worth of at least two million dollars not counting a primary residence, or if the advisor has at least one million dollars of money invested by the client. Such an agreement must be made in advance, and should never be done immediately prior to a trade.
For a sophisticated investor, paying zero management fees and 20% performance fees can be a superior method of compensation so an advisor only gets paid when is client comes out ahead. However, only the wealthiest clients qualify for this kind of fee structure.
A decade ago the U.S. Federal Reserve was convinced that it would, so they began their destructive policy of near-zero interest rates. Instead of increasing investment spending and stimulating the economy as they thought it would, it created dangerous asset bubbles for stocks, corporate bonds, and real estate which have just begun historic collapses, not to mention huge wealth disparities. By 2019, no one will hopefully seriously consider repeating this fiasco again.