Few managers satisfy these dual criteria, but those who do tend to have both good returns and low risk - just the kind of manager that anxious investors are more likely to follow through thick and thin.Įach year for two decades I have compiled a list of investment newsletter editors who meet these dual criteria I call it my Investment Newsletter Honor Roll. So what’s the solution for skittish investors? One option is to only follow managers who have historically produced above-average performance in both up- and down markets. Read: The 7 tough questions you need to ask your financial adviser This doesn’t work for everyone many skittish investors find the attendant volatility too much too take. Lynch instead recommended that investors stick with his fund through thick and thin, which is indeed one way of overcoming these constant whipsaws. This meant they bought at the high and sold at the low, which is a reliable way to lose money. What was evidently happening was that many investors were only buying into the fund after it had rallied, then selling after a correction. equity fund over the trailing two decades, and yet he told those advisers that more than half the investors who’d ever owned the fund had lost money. His fund at that time was the best-performing U.S. The crucial role psychology plays in investment success was brought home to me in a powerful way in the early 1990s after reading something that Peter Lynch, the legendary manager of Fidelity Magellan fund, told a group of financial advisers. *merged with Suncor Energy with shareholders receiving 1.28 Suncor shares for every PCA share.Tips for financial freedom from Nobel Prize winners Newsletter Credibity Check: Here are some of the "buy" rated stocks mentioned in some major investing newsletters in October, 2008 while the stock markets plunged. Though it's disappointing to see Manulife down about 11 per cent while the capped financial index has gained 35 per cent year to date, it's worth noting that Manulife fell as low as $9.02 in March, 2009. What didn't work: Manulife Financial, the worst performer in the S&P/TSX capped financials index in 2009 and, these days, the financial stock most likely to surprise shareholders in a bad way. The best return came from Bell Aliant Regional Communications Income Fund, a good defensive name. What worked: A trio of income trusts all made at least a little money. But each crisis is also similar, in that they all pass eventually, and they are very often followed by a significant rally as confidence in the future resurges." What it said in October, 2008: "Each crisis is a little different, and this one is particularly special, in how it manifests itself. Reality check: Diageo's gains were eaten up by the appreciation of the Canadian dollar against its U.S. The other picks were nicely diversified throughout the economy. One impressive thing about IWB's picks is that they included only one defensive name, Enbridge. Each of the five picks made last October was higher as of late this week, although some made it by mere millimetres. What worked: IWB was the one newsletter of the five to have a perfect record.
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