Liquid Millionaire, drying up?

This is a discussion on Liquid Millionaire, drying up? within the Educational Resources forums, part of the Commercial category; Health and Safety warning... Brother Stevo and Brother Paulie, SIT DOWN NOW, the following may just buggar up the rest ...

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Old Nov 17, 2016, 12:33am   #46
Joined Aug 2016
Nobel Prize Winner 1.

sigmund1 started this thread Health and Safety warning... Brother Stevo and Brother Paulie, SIT DOWN NOW, the following may just buggar up the rest of your misguided life!

Eugene Fama is an American economist, often referred to as "The Father of Finance", best known for his empirical work on portfolio theory, asset pricing and stock market behavior.

His M.B.A. and Ph.D. came from the Booth School of Business at the University of Chicago in economics and finance.

His doctoral supervisors were Nobel prize winner Merton Miller and Harry Roberts, but Benoit Mandelbrot was also an important influence. He has spent all of his teaching career at the University of Chicago.

His Ph.D. thesis, which concluded that short-term stock price movements are unpredictable and approximate a random walk, was published in the January 1965 issue of the Journal of Business, entitled "The Random Walks In Stock Market Prices",[7] which was published in the Financial Analysts Journal in 1965 and Institutional Investor in 1968.

His later work with Kenneth French showed that predictability in expected stock returns can be explained by time-varying discount rates, for example higher average returns during recessions can be explained by a systematic increase in risk aversion which lowers prices and increases average returns.

His article "The Adjustment of Stock Prices to New Information" in the International Economic Review, 1969 was the first event study that sought to analyze how stock prices respond to an event, using price data from the newly available CRSP database. This was the first of literally hundreds of such published studies.

In 2013, he won the The Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel.

Bloody heck, that sounds impressive, a Nobel Prize Winner.

Good grief he must be one of those super brainy types that make Carol Vauderman look like a doughnut when it comes to mathematics.

Note to Brother Stevo...that’s SUMS to you, cos I remember you only got an F in maths.

So what does Fama say about TIMING ACTIVLY MANAGED FUNDS?

"NEVER...THE GAME OF DOING SOMETHING ACTIVE IS FRAUGHT WITH LOSSES...THERE'S NO EVIDENCE THAT MARKET TIMING WORKS".

Last edited by sigmund1; Nov 17, 2016 at 10:11am.
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Old Nov 17, 2016, 12:24pm   #47
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Eugene Fama quotes

sigmund1 started this thread The Nobel laureate known as one of the founders of passive investing lets loose on active management.

"Active management is a fallacy, and it’s completely unnecessary."

Passive investing is the only sensible way to go.

“There’s this fallacy that people believe that we need active managers".

“When is active management good?... The answer is ‘never"

“It’s always a zero-sum game".

“In the end, they realize that the game of doing something active is fraught with problems.”

Personally, Fama invests in index market portfolios.

“Active management is another way of saying market timing and there’s no evidence that works.”

Nan say's...what have the Sutherlands got to say about that?
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Old Nov 19, 2016, 10:39pm   #48
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Nobel Laureate 2. Daniel Kahneman

sigmund1 started this thread Awards, Nobel Prize in Economic Sciences.

The average investor's return is significantly lower than market indices due primarily to market timing...Daniel Kahneman.

Question. So investors shouldn't delude themselves about beating the market?

Answer. "They're just not going to do it. It's just not going to happen".

As reported Orange County Register. 2002.

Last edited by sigmund1; Nov 20, 2016 at 12:17pm.
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Old Nov 21, 2016, 12:58pm   #49
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Nobel Laureate 3. William F Sharpe.

sigmund1 started this thread "After costs, the return of the average actively managed dollar will be less than the return on the average passively managed dollar.”

William F. Sharpe, Nobel Laureate in Economics, 1990
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Old Nov 24, 2016, 10:54am   #50
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Nobel Laureate 4 Merton Miller.

sigmund1 started this thread "Any fund manager who doesn't have the vast majority of their portfolio in passive investments is guilty of malfeasance, nonfeasance or some other kind of bad feasance!" February 1997 - "Investment Gurus," Peter Tanous

"Most people might just as well buy a share of the whole market, which pools all the information, than delude themselves into thinking they know something the market doesn't. " 1974 - http://www.brainyquote.com
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Old Nov 26, 2016, 12:18pm   #51
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more quotes on timing the markets

sigmund1 started this thread The evidence has shown that market timing doesn't yield superior results. With that in mind, here are some quotes on market timing from some of the most astute minds in the industry.

Warren Buffett
"We continue to make more money when snoring than when active."

"The only value of stock forecasters is to make fortune-tellers look good."

"My favorite time frame is forever."

Peter Lynch
"Far more money has been lost by investors preparing for corrections, or trying to anticipate corrections, than has been lost in corrections themselves."

"I can't recall ever once having seen the name of a market timer on Forbes' annual list of the richest people in the world. If it were truly possible to predict corrections, you'd think somebody would have made billions by doing it."

Jason Zweig
"Whenever some analyst seems to know what he's talking about, remember that pigs will fly before he'll ever release a full list of his past forecasts, including the bloopers."

Charles Ellis
"'Market timing' is unappealing to long-term investors."

Jonathan Clements
"What to do when the market goes down? Read the opinions of the investment gurus who are quoted in the WSJ. And, as you read, laugh. We all know that the pundits can't predict short-term market movements. Yet there they are, desperately trying to sound intelligent when they really haven't got a clue."

Bernard Baruch
"Only liars manage to always be out during bad times and in during good times."

Mark Rieppe
"Market timing is impossible to perfect."

David L. Babson & Company
"It must be apparent to intelligent investors that if anyone possessed the ability to do so [forecast the immediate trend of stock prices] consistently and accurately he would become a billionaire so quickly he would not find it necessary to sell his stock market guesses to the general public."

Financial Publications
"Let's say it clearly: No one knows where the market is going-experts or novices, soothsayers or astrologers. That's the simple truth." -- *Fortune.

"A decade of results throws cold water on the notion that strategists exhibit any special ability to time the markets." ---* The Wall Street Journal.
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Old Dec 9, 2016, 11:14am   #52
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Charles Ellis

sigmund1 started this thread Was one of the best kept secrets on Wall St...Aggressive Fund Mangers cannot beat the market.

Charles Ellis credited as being the first industry insider to go public that managed fund managers will underperform the market over the long term.

Did that make Charley a whistle blower!

Wrote the book The Losers Game in 1975...now in it's fifth print.

Noted research proves that money managers DO NOT possess any money making skills...message to Brother Paul and Stephen.

“The investment management business (it should be a profession but is not) is built upon a simple and basic belief: Professional money managers can beat the market. That premise appears to be false.”

Strange how slow the general public have been in learning that message.

As our Nan say's...Fools and Their Money.
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Old Dec 11, 2016, 12:55pm   #53
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Fading Stars

sigmund1 started this thread You might describe Star Manager Bill Miller of Legg-Mason as a fading star.

Brother Paul and Brother Stephen might want to take notes.

Bill Miller earned the reputation for out performing the SP500 INDEX for 15 consecutive years. No one else has ever managed such a feat.

Cue the cheer leaders.

HANG ON, NOT SO FAST.

That was back then and like all managed fund managers Bill's star started to fade until it was no more.

2008 saw the end of Bill's stellar performance, he hung in there for a few more years but unfortunately for Bill his edge was gone.

He'd gone from being the manager that could do no wrong to the guy who could do no right.

Bill and his clients had their 15 minutes in the sun but it's all a dimm faded memory now.

Mathematics and reality had caught up with him...ACTIVE FUND MANAGERS CANNOT BEAT THE INDEX'S FOREVER.

Last edited by sigmund1; Dec 11, 2016 at 6:43pm.
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Old Dec 14, 2016, 12:19pm   #54
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ISACO v SP500 TRACKER FUNDS.

sigmund1 started this thread ISACO 121%.

SP500 INDEX TRACKER FUNDS AROUND 190%.

ISACO's management fees, £3000 per year.

Tracker Fund fee's, around the cost of a fish and double chip take away!

Performance data found on ISACO's web site. Dec 1997 to Dec 2015.
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Old Dec 22, 2016, 7:08pm   #55
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Can't Find It!

sigmund1 started this thread I've looked and I've looked but it isn't there!

That is I've looked at the Brothers 2 books and can't find one word about it.

That's over 500 pages and not one reference, not one word...nothing, nuffing. nada, zilch, zero.

You would think this pair would only be to glad to boast about it, but seems not.

I'm talking about how they timed the run up to the 2000 bull market top and the market down turn into 2003.

But alas not one word...I wonder why?

Could it be that they made a pigs ear of it.

Could it be that their timing was worse than the 2007 market top.

So how about it Brother Stephen and Brother Paul.

Your silence is deafening!
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Old Dec 29, 2016, 12:37pm   #56
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ISACO vs SP500 Tracker Fund.

sigmund1 started this thread The Brothers ISACO claim on their web site that 7 years ending 31 Dec 2015 and following their hot shot fund picking methods...

£250.000 would have increased to £539.000.

Wow, Golly Gee-Whiz.

A typical numb-nut, passive SP500 TRACKER FUND would have increased to £657.000. Same period.

NO WAY...YES WAY.

That's a whopping £118.000 more from the Tracker Fund.

NO WAY, YES, NO-WAY.

It's even less for these poor little people who signed up to the ISACO lunatic mystery tour.

Because...

Management fees for the 7 years is £21,000.

Which means ISACO INVESTORS are £139.000 out of pocket.

And that's just in 7 years.

NO-WAY, YES-WAY, YES, DOUBLE WAY.

Last edited by sigmund1; Dec 30, 2016 at 12:17pm.
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Old Jan 18, 2017, 1:14pm   #57
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Who's the Daddy?

sigmund1 started this thread Like they say on the Jeremy Kyle show, the results are in.

So, Who's the Daddy?

Is it the Brothers ISACO, with their In Out, In Out, Shake It All Around, smarty pants methods.

Or, the Wake Me Up Before You Go-Go PASSIVE INDEX TARCKER method.

The ISACO Brothers tell us on their web site that for the 5 years ending December 2016 they managed to return 8.2%.

But how does this compare with the FTSE100?

Dont take my word for it...take a look at the RUSSELL FTSE web site under Fact Sheet.

FTSE100. 9.1%
FTSE250. 15.4%
FTSE SMALL CAP 16.4%
FTSE ALL SHARE. 10.1%
FTSE FLEDGLING. 19.8%

Good bloody grief...does this mean that the ISACO Brothers have under performed their fav benchmark for the last 5 years?

Looks Like It.
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Old Mar 13, 2017, 11:15am   #58
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Folly of Market Timing

sigmund1 started this thread So what went wrong?

Looks like the ISACO Super Timing Fund Picking Portfolio has under performed the FTSE100 for the last 5 years.

But could this fatal adventure have been avoided?

According to one such research paper...YES!

A study by University of Utah Professor John Graham and Duke University Professor Campbell Harvey.

The massive 51-page study tracked 15,000 predictions made by 237 market-timing newsletters from June 1980 to December 1992.

By the end of the period, 94.5% of the timing newsletters had gone out of business with an average life span of just four years.

"There is no evidence that newsletters can time the market," the study concluded.

"Consistent with mutual fund studies, 'winners' rarely win again and 'losers' often lose again."

"Sure, it'd be great to get out of stocks at the high and jump back in at the low," observed John Bogle in an interview with Money Magazine.

"In the 55 years I have been in this business, I not only have never met anybody who knew how to do it, I've never met anybody who had met anybody who knew how to do it."

Our Nan say's...you can the Sutherland Brothers to that list as well.
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Old Mar 15, 2017, 12:17pm   #59
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RESULTS, ISACO v SP500, NASDAQ.

sigmund1 started this thread The Isaco brothers Paul and Stephen were full of confidence back in 2007 when they wrote their Book of Funny Sayings...Liquid Millionaire.

Here is one such funny quote...

An investment System Capable of Beating the Nasdaq. page 97.

But since inception how have our Deadly Duo actually performed?

According to information found on the ISACO web site...

Since December 31, 1997 to December 31 2016 have returned for their clients, wait for it, drum roll...149% Total Return.

But for a LOW COST SP500 TRACKER FUND PLUS DIVIDENDS the Total Return was 270%

For a LOW COST NASDAQ TRACKER FUND WITHOUT DIVIDENDS the total return was
290%.

Seems to me the Brothers Stephen and Paul are wealth destroyers not wealth creators.
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Old Mar 17, 2017, 11:51am   #60
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ISACO v OTHER TRACKER FUNDS

sigmund1 started this thread Recap...ISACO total return since inception 149%.

But for exactly the same period...

US SMALL COMPANY INDEX FUND...445%

INTERNATIONAL VALUE FUND... 215%

EMERGING MARKTS INDEX FUND... 315%

EMERGING MARKETS SMALL CAP INDEX FUND... 630%

Just like those before and those that will follow, the ISACO Brothers have fallen flat on their faces when it comes to fund picking.
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