Invest Intelligence When It Realy Matters
What Should You Do If You Can't Afford Our Research?
Originally published on May 18, 2012
We get emails all the time from people telling us that they want to subscribe to our research and newsletters, but they just can’t afford it.
That’s hogwash.
All it says is that you fail to recognize the power of brilliant world-class insight and how much you underestimate the extent to which media is steering you into the gutter.
Wise individuals realize that even our website Membership is worth tens of THOUSANDS of dollars due to the unique and power insight Members receive which will enable them to avoid con men, investment scams and become clear-thinking savvy investors.
Affording something is a matter of personal choice. Part of that formula involves deciding the value of various consumer goods and services you are willing to pay for.
It's all about where your priorities are.
The same individuals who think they cannot afford our research are likely to pay $50-$120 per month for cable TV, or $100/month for premium mobile phone service.
They may even be wasting $100 on newspaper and magazine subscriptions.
Why in the hell would anyone actually pay the media to receive advertisements? I suppose most people are naive.
Here, I am going to post our response to an individual who stated that he had a 401(k) plan, but the total amount of funds was not enough to justify the cost of subscription to the Market Forecaster.
“Not to sound biased, but we know of no other source where you will receive unbiased analysis and guidance that yields consistently excellent results. All you have to do to confirm this is check the track records of everyone out there. I take it you are familiar with the track record of our Chief Investment and Trading Strategist, Mike Stathis.
More of his track record here.
Keep in mind that mutual funds typically charge 3-5% of your assets in annual fees even though they report lower fees. They add several fees that most investors are unaware of such as tick charges, auditing fees, etc. These fees are discussed in the prospectus, but one has to study the document very closely to detect them, especially if they are not aware of them.
While 401(k) fund fees are usually lower than funds bought in outside of a 401(k) plan, they are still sizable when you compound the fees over several years. The average mutual fund (load or no-load) extracts up to 70% of the gross investment returns from the fund over a 30-year period (assuming 3.5% annual fees). We cover this issue, the weaknesses of mutual funds and many other issues in the Wall Street Investment Bible, which I strongly recommend you read.
I have attached a table (see attachment) showing the effect of fund fees over time. The fees shown in the table go up to 2.5% only, which is below the industry average of around 3-3.5%.
.png)
Without knowing what kind of plan you have or the funds, my guess is that your total fees per year come out to roughly 1.5%, which over a 30-year period will result in consuming about 34% of the gross returns from your mutual funds.
Note that the stated management fees are likely to be less, but other expenses are not included in this. If you don't believe me, I suggest you look into it further.
Knowing this alone is worth a great deal of money in my opinion. Incidentally, Mr. Stathis has filed complaints to the SEC about this poor fee disclosure and he reported that SEC attorneys told him ‘there is nothing wrong with that, the fees are explained in the prospectus.’
We do not provide personalized financial advice. However, we do provide world-class investment research and analysis and market forecasting.
If you have a good understanding about market forecasting, you can sell your funds and move the cash into money market funds (almost always at no cost as long as you remain within the same fund family; check with your plan administrator to confirm).
As an example, before we started publishing our newsletters, we received an inquiry from someone regarding what he should do with his mutual funds, having invested $500,000 a year earlier but having lost already $55,000 in the past month.
We did not advise the individual. Rather, we provided him with unbiased insights and facts about funds and our forecasts for the U.S. equities markets. After reviewing this material, he decided to sell his funds.
Three months later the stock market collapsed by some 30-35% and he thanked us for saving him from losses up to $200,000.
Finally, Mr. Stathis recommended investors start buying into the market at the exact bottom, as you may recall. We do not know what this individual did, but if he had listened to us, he could have repurchased the funds at a huge discount.
See here for the recommendation
If you check, you will see that this was Mr. Stathis very first market buy recommendation in years. In other words, he truly called the exact bottom because he was not telling people to buy all the way down.
You may also know that he predicted a low for the Dow at 6500 in his 2006 book America's Financial Apocalypse, and pin-pointed the timing in August 2008, as we recently reminded readers.
Which is more important, your retirement savings or watching cable TV and thus feeding the media criminals who do nothing but lie and support the agendas of corporate criminals?
Although we feel our research is priceless due to our spectacular track record, the media's ban on Mr. Stathis has kept rates for our research higher than they could have been if he were provided with just 1% of the exposure he deserved.
Meanwhile, the media promotes snake oil salesmen with miserable track records, allowing them to charge low rates for useless information, books and services because they have exposure to millions of people, most of which are sheep.
Affording something is a matter of personal choice. Part of that formula involves deciding the value of various consumer goods and services you are willing to pay for.
Ask yourself how much money you will pay from your fund returns over a 10, 20 or 30-year period, then determine whether you would benefit from our research and education.
For instance, assuming you have $50,000 in funds, and assuming 6.5% average annual gross returns for your funds over the next 10-year period (which is reasonable), at the end of that 10 years, your $50,000 investment will have doubled to $100,000, BEFORE fees.
Looking at the table in the attachment, you can see that if the total annual fees charged by the funds are 1%, you will have paid the fund 8.7% over that 10-year period, or $8,700.
For a 1.5% annual fee, you will have paid the fund 12.8% or $12,800 over that 10-year period. You can make the same assumptions for a 20-year period as well.
And fund managers are not able to sell much of the fund when the market collapses.
So what are you paying them for? Rebalancing?
Again, we explain how funds work and their limitations in the WSIB.
In conclusion, affording something is a matter of personal choice. Part of that formula involves deciding the value of various consumer goods and services you are willing to pay for.
Thus, the real question you need to ask yourself is whether you can afford to do without our research.
This is the most free (and honest) assistance you will probably ever receive knowing what I know about the financial industry. Good luck.”
Regards,
stafff
AVA Investment Analytics
Mike's track record speaks for itself