Source: CartoonStock
Would you be open to engaging a portfolio adviser who only earns when your portfolio does well?”
That is exactly what you get when you invest with Unicorn.
Such a fee structure is almost unheard of in today’s financial industry. For investors, it should be comforting to know that such a portfolio adviser exists — right here in Singapore. This is the kind of set-up that investors, both locally and globally, have been yearning for. Most portfolio advisers scoff at the very suggestion of it.
Unicorn currently offers this performance-based service through:
- Unicorn Securities – Minimum investment: S$250,000
Investors’ Problem with Portfolio Advisers
US$100 billion — that’s the staggering amount Warren Buffett estimated that pension funds, endowments, and wealthy individuals lost between 2001–2010 to hedge funds and other managers who charge sky-high fees.¹
At first glance, Buffett may seem to be discouraging investors from using portfolio advisers at all. But that’s a misunderstanding. Buffett’s real contention is not with the use of managers — after all, Berkshire Hathaway essentially functions as a fund — but with managers who charge high fees and fail to deliver outperformance.1
Unfortunately, many investors took Buffett’s remarks as a cue to complain about any and all fees, calling them “gross” and “unjustified.”
But here’s the reality: paying more does not always guarantee superior results — and nowhere is this truer than in investing.
Would a Berkshire Hathaway shareholder complain about paying Buffett high fees, knowing the extraordinary returns he has generated? Hardly. A simple estimate of a US$1,000 investment in Berkshire in 1964 is worth about US$28 million today.²
What Should Investors Do?
Instead of obsessing over the absolute amount of fees, look at the fee structure. It reveals much about a portfolio adviser’s motivations and alignment with you.
Imagine this scenario:
You are a shareholder of a struggling company seeking a new CEO to turn things around. One candidate proposes:
- No pay until the company becomes profitable
- 20–30% share of profits thereafter
What does this tell you?
- Alignment of Interests – He is literally in the same boat as you. You pay only when there is performance.
- Confidence – Only someone sure of their ability would accept such a challenge.
- Desire to Succeed – As Napoleon Hill said:
“When a man really desires a thing so deeply that he is willing to stake his entire fortune on a single turn of the wheel in order to get it, he is sure to win.”
Apple’s legendary CEO Steve Jobs did just that. When he returned to Apple in 1997, he revitalised the company — while drawing an annual salary of just US$1, relying instead on stock options tied to performance.³
Conclusion
Finding a good portfolio adviser or wealth planner is critical to your financial success. But don’t just look at performance numbers — scrutinise how they charge.
A fee structure is like a microscope: it magnifies who the manager really is, what they stand for, and whether they are truly on your side.
When you find a manager who is willing to bet on themselves — to win only when you win — you may have found the “good shepherd” who will grow your flock.
And when you do, remember: quality comes with a price — but a high price does not always mean quality.
Source
1 – Warren Buffett rails against fee-hungry Wall Street Managers https://www.reuters.com/article/world/uk/warren-buffett-rails-against-fee-hungry-wall-street-managers-idUSKBN1640FF/
2 – Deep Seek (How much is a US$1,000 investment in Berkshire in 1964 worth today)
3 – Steve Jobs Still Makes a $1 Salary
http://techland.time.com/2011/01/12/steve-jobs-still-makes-a-1-salary/
