Mom's 'managed portfolio' at Edward Jones

With Dad's death last year, Mom was faced with selling the house, renting a condo, and investing the proceeds from the sale to provide an income stream. I toyed with the idea of managing Mom's assets myself (I went so far as to offer), but she followed the time-honored tradition of asking her friends who they invested with and went that way.

Since Mom still labors under the delusion that 'I'm the smart one', I was asked to review the portfolio and give her my blessing. Here's what they came up with:

Diversified Portfolio at Edward Jones


Domestic Stock Funds



International Stock Funds



Municipal Fixed Income Bonds




Fund Name (ticker)



U.S. Large Cap Stocks Growth

Oak Ridge Investments, LLC - Large Cap Growth (Chicago)

1.88% Expense Ratio


U.S. Large Cap Stocks Value

Davis Advisors - Large Cap Value  (New York)

1.88% Expense Ratio


U.S. Mid Cap Value

Anchor Capital Advisors (Boston)

1.88% Expense Ratio


U.S. Small Cap Core

Gannett Welsh & Kotler, Inc (Boston)

1.88% Expense Ratio


International Equity

Jarislowsky Fraser Limited (Montreal)

1.88% Expense Ratio


Muni Fixed Income Bonds

Lord Abbett & Co. (Jersey City, NJ)

1.88% Expense Ratio






If it's not obvious, the portfolio is structured around a 'one price for everything' management fee of 1.88%. If you've been reading around my site, you'll know I'm pretty loathe to pay sales loads, high expense ratios, and the like.

This presented something of a dilemma. If these guys are going to 'manage' the funds, they should of course be fairly compensated. When I had what I considered a properly diversified portfolio in relatively efficient mutual funds, I had a total weighted expense ratio of 0.98%, or roughly half the expense. Weighing this against my potential actual time managing Mom's account, and the awkwardness of it (imagine the 'fun' of explaining that Mom's portfolio is down 10% YTD at the Thanksgiving dinner table), I decided that the difference in expenses may well be worth it. Plus, Mom likes it. They provide a 'one stop shop' feel for her, pay her rent, stuff like that.

I was also nicely impressed at the asset allocation scheme. The stereotype for a senior portfolio leans towards '100% Muni bonds', and this portfolio is well-positioned to outpace inflation and actually grow.


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