Recently, a new client asked one of our advisors how high portfolio turnover would effect their portfolio. This timely question makes sense; after all, we often warn our clients and other investors about the disadvantages and high costs of wealth management strategies based on active management.
Our answer? High portfolio turnover is the source of most of the extra costs associated with active management – costs that are completely unnecessary and avoidable with more efficient investment guidance. Read on to find out why.