"My guy always beats the market"
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"My guy always beats the market"
We've all heard people say this while we try our best not to roll our eyes and hold our lips tight. I heard a coworker say this about their Edward Jones adviser and had visions of him throwing 5% of his money into a burning trash can every time he makes a deposit. It prompted me to wonder how many people think they or their advisers "always beat the market" but I couldn't find any good articles or research. Does anyone know of any?
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Re: "My guy always beats the market"
Just a guess here, but I would guess that virtually nobody who claims to always beat the market has ever beaten the market. Just useless blowhards.
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Re: "My guy always beats the market"
I've noticed that when an adviser says they beat the market, or an individual is bragging about how his managed portfolio beat the market, what they really mean is that it beat the S&P500. Nevermind that their portfolio was full of emerging markets, SCV, gold, etc...
Re: "My guy always beats the market"
"Hello. I'd like to please get a written guarantee that you can beat the market average, and that if you fail to do this, you will compensate me for the difference. In addition, should you fail to meet your own internal performance benchmarks, I expect to be compensated for that shortfall, and I also expect to see a comprehensive and actionable plan to prevent it from happening again."
I don't think you'll get it.
And I think it might even be illegal to issue such a statement, if that is any indication.
"Pay me several times more than you'd pay a competitor. In return, I offer no guarantees of anything at all."
Wow. What a deal.
I don't think you'll get it.
And I think it might even be illegal to issue such a statement, if that is any indication.
"Pay me several times more than you'd pay a competitor. In return, I offer no guarantees of anything at all."
Wow. What a deal.
And probably over a carefully-selected period of time. Too often, graphs are used to mislead.clevername wrote:I've noticed that when an adviser says they beat the market, or an individual is bragging about how his managed portfolio beat the market, what they really mean is that it beat the S&P500. Nevermind that their portfolio was full of emerging markets, SCV, gold, etc...
Last edited by Jeff7 on Fri May 31, 2013 12:13 pm, edited 1 time in total.
Re: "My guy always beats the market"
It's easy to beat the market if you choose an inappropriate metric for comparison.
Invest in small companies, compare to the S&P 500. Invest in junk bonds, compare to Treasuries. Invest in anything, pick a 5 star Morningstar fund for comparison later on.
Make 100 predictions. Cherry-pick the ones that work out.
Keith
Invest in small companies, compare to the S&P 500. Invest in junk bonds, compare to Treasuries. Invest in anything, pick a 5 star Morningstar fund for comparison later on.
Make 100 predictions. Cherry-pick the ones that work out.
Keith
Déjà Vu is not a prediction
Re: "My guy always beats the market"
funny! whats the point of asking this get this in written when you know it is not possible to get?Jeff7 wrote:"Hello. I'd like to please get a written guarantee that you can beat the market average, and that if you fail to do this, you will compensate me for the difference. In addition, should you fail to meet your own internal performance benchmarks, I expect to be compensated for that shortfall, and I also expect to see a comprehensive and actionable plan to prevent it from happening again."
I don't think you'll get it.
And I think it might even be illegal to issue such a statement, if that is any indication.
"Pay me several times more than you'd pay a competitor. In return, I offer no guarantees of anything at all."
Wow. What a deal.
And probably over a carefully-selected period of time. Too often, graphs are used to mislead.clevername wrote:I've noticed that when an adviser says they beat the market, or an individual is bragging about how his managed portfolio beat the market, what they really mean is that it beat the S&P500. Nevermind that their portfolio was full of emerging markets, SCV, gold, etc...
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Re: "My guy always beats the market"
They also love to leave out the dividends when comparing to the S&P 500.
1) Invest you must 2) Time is your friend 3) Impulse is your enemy |
4) Basic arithmetic works 5) Stick to simplicity 6) Stay the course
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Re: "My guy always beats the market"
deleted.
Last edited by YttriumNitrate on Sat Mar 12, 2016 11:27 am, edited 1 time in total.
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Re: "My guy always beats the market"
My guy Bernie always beat the market.
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Re: "My guy always beats the market"
I know there are examples of people who have beaten the market in the past but there has to be some kind of study or article which says that say 83% of people think they beat the market when in reality only XX% do...YttriumNitrate wrote:Warren Buffet has had a good run of beating the market. I believe the standard he uses is the five year average of Berkshire vs. the S&P500. That being said, there's a good chance that streak will come to an end soon.barnaclebob wrote: It prompted me to wonder how many people think they or their advisers "always beat the market" but I couldn't find any good articles or research. Does anyone know of any?
Re: "My guy always beats the market"
Is the "adviser" beating the market before or after dividends? Even the most inept manager can beat that.barnaclebob wrote:We've all heard people say this while we try our best not to roll our eyes and hold our lips tight. I heard a coworker say this about their Edward Jones adviser and had visions of him throwing 5% of his money into a burning trash can every time he makes a deposit. It prompted me to wonder how many people think they or their advisers "always beat the market" but I couldn't find any good articles or research. Does anyone know of any?
A few years ago several Swedish banks that have a major part of the mutual fund business used indices ex dividends as their benchmarks and after a "PBS" report highlighting this the reporting was changed.
Other, possibly unrelated, good news is that low cost index funds have appeared, in the range from 0.0 to 0.4, with no load fees.
Last edited by allsop on Fri May 31, 2013 12:33 pm, edited 1 time in total.
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Re: "My guy always beats the market"
Here's a few to help:
http://www.forbes.com/sites/rickferri/2 ... he-market/
http://www.forbes.com/sites/greggfisher ... et-timing/ (presuming the beater beats by including this strategy)
http://www.bogleheads.org/forum/viewtopic.php?t=76227 (and the threads progenitor, http://moneywatch.bnet.com/investing/bl ... #comments)
Seems like a good start.
http://www.forbes.com/sites/rickferri/2 ... he-market/
http://www.forbes.com/sites/greggfisher ... et-timing/ (presuming the beater beats by including this strategy)
http://www.bogleheads.org/forum/viewtopic.php?t=76227 (and the threads progenitor, http://moneywatch.bnet.com/investing/bl ... #comments)
Seems like a good start.
Re: "My guy always beats the market"
If you really had actionable knowledge that would allow you to beat the market, would you share it with everyone you knew, publish newsletters, and write articles in finance magazines, or would you trade in your own personal account and make yourself rich? Why do people think advisors are any different? If they had a surefire way of beating the market, why on earth would they tell you?
50% VTI / 50% VXUS
Re: "My guy always beats the market"
I actually haven't heard anyone say their advisor "always" beats the market; it's more like "my advisor may not beat it every time, but at least he can beat it more often than your index fund." Have to admit he got that last part right.barnaclebob wrote:We've all heard people say this while we try our best not to roll our eyes and hold our lips tight. I heard a coworker say this about their Edward Jones adviser and had visions of him throwing 5% of his money into a burning trash can every time he makes a deposit. It prompted me to wonder how many people think they or their advisers "always beat the market" but I couldn't find any good articles or research. Does anyone know of any?
"Yes, investing is simple. But it is not easy, for it requires discipline, patience, steadfastness, and that most uncommon of all gifts, common sense." ~Jack Bogle
Re: "My guy always beats the market"
Don't most of the advisers that show up on "American Greed" always beat the market?
Re: "My guy always beats the market"
It's just a scenario to illustrate to someone the reason that their premise simply doesn't make for a good sales pitch:Hector wrote:funny! whats the point of asking this get this in written when you know it is not possible to get?Jeff7 wrote:"Hello. I'd like to please get a written guarantee that you can beat the market average, and that if you fail to do this, you will compensate me for the difference. In addition, should you fail to meet your own internal performance benchmarks, I expect to be compensated for that shortfall, and I also expect to see a comprehensive and actionable plan to prevent it from happening again."
I don't think you'll get it.
And I think it might even be illegal to issue such a statement, if that is any indication.
"Pay me several times more than you'd pay a competitor. In return, I offer no guarantees of anything at all."
Wow. What a deal.
And probably over a carefully-selected period of time. Too often, graphs are used to mislead.clevername wrote:I've noticed that when an adviser says they beat the market, or an individual is bragging about how his managed portfolio beat the market, what they really mean is that it beat the S&P500. Nevermind that their portfolio was full of emerging markets, SCV, gold, etc...
They're making a claim that they can give you better performance than an index fund, which is why their higher cost will end up being worth it for you.
Ok, fine. Back that statement up with something, like a contract, or written guarantee. What's that? You can't do that? Then why should I pay your fees?
Well...John Bogle did kind of figure out a way to beat most of the "market" that was comprised of active traders: Go for the average. And he's certainly helped to share that wealth with very many people.nimo956 wrote:If you really had actionable knowledge that would allow you to beat the market, would you share it with everyone you knew, publish newsletters, and write articles in finance magazines, or would you trade in your own personal account and make yourself rich? Why do people think advisors are any different? If they had a surefire way of beating the market, why on earth would they tell you?
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Re: "My guy always beats the market"
That's why I ask Senator's and Representatives for security selection advice. Seems to work out well.
RM
RM
I figure the odds be fifty-fifty I just might have something to say. FZ
Re: "My guy always beats the market"
Does the S&P 500 include dividends re-invested?allsop wrote:Is the "adviser" beating the market before or after dividends? Even the most inept manager can beat that.barnaclebob wrote:We've all heard people say this while we try our best not to roll our eyes and hold our lips tight. I heard a coworker say this about their Edward Jones adviser and had visions of him throwing 5% of his money into a burning trash can every time he makes a deposit. It prompted me to wonder how many people think they or their advisers "always beat the market" but I couldn't find any good articles or research. Does anyone know of any?
A few years ago several Swedish banks that have a major part of the mutual fund business used indices ex dividends as their benchmarks and after a "PBS" report highlighting this the reporting was changed.
Other, possibly unrelated, good news is that low cost index funds have appeared, in the range from 0.0 to 0.4, with no load fees.
Or is there an accumulation index (dividends re-invested) to benchmark against?
Re: "My guy always beats the market"
It's just like going to the casino and bragging you won. you never come back and brag the times you lost.
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Re: "My guy always beats the market"
Depends on the population you pick. I would say from my small sample size (management of the company I work for) about 50% give me that line. I just ignore it and let them be happy. At least nobody tried to hook me up with their adviser yet.
Re: "My guy always beats the market"
From http://en.wikipedia.org/wiki/S%26P_500 :Redstorm wrote:Does the S&P 500 include dividends re-invested?allsop wrote:Is the "adviser" beating the market before or after dividends? Even the most inept manager can beat that.barnaclebob wrote:We've all heard people say this while we try our best not to roll our eyes and hold our lips tight. I heard a coworker say this about their Edward Jones adviser and had visions of him throwing 5% of his money into a burning trash can every time he makes a deposit. It prompted me to wonder how many people think they or their advisers "always beat the market" but I couldn't find any good articles or research. Does anyone know of any?
A few years ago several Swedish banks that have a major part of the mutual fund business used indices ex dividends as their benchmarks and after a "PBS" report highlighting this the reporting was changed.
Other, possibly unrelated, good news is that low cost index funds have appeared, in the range from 0.0 to 0.4, with no load fees.
Or is there an accumulation index (dividends re-invested) to benchmark against?
"The "S&P 500", generally quoted, is a price return index; there are also "total return" and "net total return" versions of the index. These versions differ in how dividends are accounted for. The price return version does not account for dividends; it only captures the changes in the prices of the index components. The total return version reflects the effects of dividend reinvestment. Finally, the net total return version reflects the effects of dividend reinvestment after the deduction of withholding tax"