Nick O’Connor – Capital and Conflict (Great Britain) –
Here’s a conundrum for you.
Charlie Morris worked in the City for 17 years. He managed $3 billion in client assets. And in the ten years between 2003 and 2013, he more than doubled his clients’ money (keep in mind that included the financial crisis). So how come this year as The Fleet Street Letter investment director, he’s had one of the very best years of his entire career?
The answer is obvious when you think about it. And it proves why our business – providing high-quality investment research for private investors – can help you be a more successful investor without handing control of your money to someone else.
First up, the numbers. Charlie became investment director at The Fleet Street Letter in January. We offered all our readers the opportunity to follow his advice at a discounted price (£79). Maybe you took us up on the offer. Or maybe you thought it wasn’t right for you. Or perhaps you didn’t see it!
That’s all in the past now so it doesn’t really matter. What matters is: if you started following Charlie in January, then chances are you’ve destroyed the market this year.
Charlie has built two portfolios for his readers. They’re called Whisky and Soda. Whisky is more aggressive and tactical. Soda is more long term, lower risk and less active. The idea is you follow both, with an allocation that suits you. Perhaps 50:50. Or if you’re more risk-averse, perhaps 20:80. It’s your call.
Whatever your allocation, you’d have beaten the market so far this year. Both portfolios have performed admirably. Whisky is up 24% for the year. Soda is up 20%. The FTSE 100 is up 14%.
That’s some outperformance. Given one year of Charlie’s work is £159 (and you can get your first year for £79 as an introductory offer), it’s probably the best performance at the best value around.
Those are my words, not Charlie’s. My question is: how come Charlie’s had such a great year right after leaving his long-held post in the City?
That’s simple. Freedom. As a fund manager, you often have an obligation to own certain asset classes. You can tinker with the allocation, but it’s hard to completely avoid certain things – like bonds, for instance.
And of course, you may have a mandate to invest in certain kinds of assets. You often don’t have complete freedom to invest anywhere and everywhere you see opportunity.
As investment director of The Fleet Street Letter, it’s the complete opposite. Charlie has the latitude to invest in exactly what he wants, when he wants. He’s free to go 100% cash, if that is what he feels is best (I can’t imagine he would, but he can). That’s because as newsletter publishers the only obligation we have is to provide our readers with credible investment advice and research. If we don’t do that, we go out of business. The best thing we can do when someone like Charlie comes along, is give him the freedom to share his experience and insight with you.
It’s a great example of the value of having an active manager on your side. And it comes with a big added benefit: you don’t actually have to hand your money over to someone else. You get the insight and the returns, without the loss of control. Which is more or less the mission statement for our entire business.
It’s also an argument for active management in general. To be honest, I find the whole active vs passive investing debate tedious so I won’t go on about it. But examples like this prove that it is possible to beat the market through active management. But you won’t beat it if you don’t try.
Passive investing, to me, is often just a euphemism for being intellectually passive: for giving up, toning down your ambition and walking away. That’s fine. You’ll get what everyone gets and no better. And you won’t pay through the nose. But you’re essentially giving up on the idea that anyone can ever beat the market. Results like Charlie’s prove that’s wrong.
But the very fact you read Capital & Conflict tells me you’re probably someone who believes you can beat the market, and wants to try. If you’re not… there are plenty of people in the City who’ll manage your money for you and charge you handsomely for the privilege. But if you want to keep control of your money, figure the markets out for yourself and not pay vast fees – you’re in the right place.
By the way, I got a couple of emails last week complaining about the price of some of our research services. It’s true: some of our work is intended for serious investors who want high level investment advice and research, and the price reflects that.
But if you’re a new reader or on the fence about trying our work out, you should know we publish several newsletters that are suitable for everyone and are extremely good value.
For instance, if you want to follow someone like Charlie – an active, tactical investor who’s constantly on the lookout for new opportunity – you can receive your first year for just £79.
If you’re more interested in higher-risk, high-tech stock picks – where you’d likely select a few to follow, rather than track the whole portfolio – you should try following Eoin Treacy at Frontier Tech Investor. It’s just £29 for your first year.
Or if you’re more interested in a simple, long-term “set and forget” portfolio that’ll see you through hard times and good (or that pays you a steady income) try Tim Price’s London Investment Alert. You can get your first year for £45.
We publish a lot more than that, of course. But if you’re just getting started and you want to explore what’s right for you without breaking the bank, that’s a good place to start.
And of course, all of the above have a 30-day money back guarantee period. So you can try things out, see what’s right for you and walk away without having paid a penny if you don’t like what you see.
As always, I’m keen to hear what you think. You can write to me at firstname.lastname@example.org any time. I do read all emails personally, even if sometimes I can’t respond (I’m only human!).