A VERY SOPHISTICATED INVESTOR

Most of the people we help are "above average" 401K/IRA investors. They generate returns that are better than the 5% per year that the average 401K investor. Most of the portfolios we see are positioned to generate about 6.5% to 7.0% per year - about what a Target Date fund investor produces. This is not bad, but we can immediately get them to be able to generate 9% to 10% per year just by changing their fund selections.

Very rarely do we get to work with more advanced investors who have the fund picking part of the equation solved. But, even these sophisticated investors struggle with the challenge of protecting their portfolios in bear market crashes. Let me tell you about Tom.

Tom is a very successful Do-It-Yourself investor.  When he came to us his fund picking was so good that he was positioned to achieve almost 10% per year on his investments.  It took him a long time and a lot of work to get to this point.  He says he made a lot of mistakes along the way and he has the scars to prove it.  

Tom had tried all the various methods being pitched including following the big names on CNBC.  He had read tons of books on investing and paid for many investing services.  He is definitely the most sophisticated and experienced investor we have ever helped. He even uses some of the more sophisticated analytical and trending tools used by the big Wall Street firms -  industry tools like MACD and RSI indicators.  He was using these tools to make adjustments to his portfolio in volatile markets.

We were not able to help him much with his investment choices because he was doing pretty much everything we teach already.  We were able to simplify his investments because he had a lot of overlap in his portfolio and some investments that just did not fit.  So he will earn a little more as a result but he came to us because he wanted a better system to protect his portfolio during bear markets.  

He was using a service that relies on the trending tools previously mentioned, but he lost a lot of money in 2023 using that service.  He never really trusted it to begin with but now he knew he needed something better.

For the sophisticated investors in our group, we do not use the standard industry statistics like moving averages and relative strength indicators because, like Tom found out, they don’t work.  Most of these tools are lagging indicators.  They do a good job of telling you what has happened in the market but they are not great predictive tools.  And because they rely on moving averages, they are too slow to react.

We use our own proprietary algorithms for our Market Signals indicator.  It was developed and refined over many years and has the sole purpose of moving our customer’s money to cash when the probability of a market meltdown is high.  It is not perfect, but our “secret sauce” that makes it so successful is our rapid self correction mechanism when the Signal is wrong.  There is no other tool like this available anywhere to protect your life savings.

Tom is new to the service but he was able to get an in depth understanding of our model and he is very comfortable with our approach.  Since our service is so simple and easy to use, our next goal for Tom is to get him to spend less time analyzing the stock market and spending more time doing the things he loves.  We do the work so you don’t have to. 

Happy Investing,

Phil

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Investing in the financial products discussed in the Newsletter involves risk. Trading in such securities can result in immediate and substantial losses of the capital invested. Past performance is not necessarily indicative of future results. Actual results will vary widely given a variety of factors such as experience, skill, risk mitigation practices, and market dynamics.