I own 20% of a privately owned company. This is going to increase in the future due to an inheritance (to 50%).
That company has a healthy amount of money in real estate and stock holdings. The real estate part performs quite good. If I’d own 100% of the company, I’d keep the real estate.
However, the stocks are not that great, part of the portfolio is stockpicked (bank advisor + CFO), part of it is in high TER funds. It hurts me to see the returns of the past 10 years. We all know that it would’ve been much more profitable if invested in VT for example.
I’d personally like to open an account at IB and invest all of it into VT.
I don’t know if this is rational thinking on my side. Companies probably should invest with less risk attached than 100% VT. But I also doubt that the stockpicking is less risky than 100% VT.
Fortunately I am able to propose some changes as I’m in a good relationship with the CFO.
Does anybody have some advice on how to act in this situation? Suggestions on how to convince the CFO/what asset allocation to follow?
PS: The CFO also suffers from sunken cost fallacy. It will be really difficult to change the whole portfolio right now as a good chunk of the stocks is in the red.