I do not. Here is my analysis of it. This explains why I view In this eight-page newsletter there is only brief mention of seven individual issues. In fact, three of the eight pages of this newsletter are consumed by a widely spaced list of 20 no-load funds he presently recommends. Removing the best three as well as the worst three performers as anomalies, the average annual yield was
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I want to first talk about Bob Brinker in part one and then Dave Ramsey in part two. Millennials probably never heard of Brinker, but he was the go-to guy for personal finance for millions every Saturday and Sunday for the last 30 years. Bob Brinker Who was Bob Brinker you ask?
Bob Brinker was the financial radio host who set me on a path to financial freedom. He was the Dave Ramsey of my era. Bob Brinker was the guru of everything financial.
Every Monday at work, I would discuss with co-workers the latest revelations from Bob. I began to listen to him in the late s as a novice investor. There was much to learn and his show was the staple of my financial diet. In it, he claims he can time the market using a proprietary model which analyzes four market components.
He believed mutual funds were better suited for the average investor. Only on occasion would he recommend an individual stock. I digress, let me pause for a moment and reflect on that disaster. I bought it based on his recommendation in his newsletter. I am sure every investor remembers their first stock, well Ultratech was mine. At this point in time, I was mainly invested in mutual funds, I was looking to venture out into the world of Individual Stocks. I did not, however, do my own due diligence.
UTEK was recommended May 31, I turned on my computer, opened the Vanguard website, I was ready to buy my first stock. I sat back and smiled with a sense of satisfaction as I hit the buy button.
Bob continued to recommend UTEK as the stock continued to plummet. I sold my position in UTEK long before Brinker stopped including it his newsletter but many subscribers continued to hold as the stock price continued to fall. My interest in individual securities did not wane. I had started to read The Motley Fool , and it was their website that helped me understand how to value and purchase individual stocks. Only subscribers are privy to these special bulletins.
I was thinking about doing that very same thing because I knew the stock market was out of control. This was when venture capital ruled the roost; profits were a thing of the past. I remember my brother sold his business as a landscaper to join the ranks of the millions who were obtaining computer certificates to enter the dot-com workforce.
The job market was so tight, anyone, with no prior experience, could obtain a ten-month certificate and make top-dollar at a high-tech company. At the time, he was living with my wife and me. It was only a matter of time before the bubble burst but I escaped most of the devastation wrought by the panic that set in when technology stocks cratered as a result of dot-com mania.
I thought I had made a mistake at first when the market kept climbing. This was a perceived brilliant move on the part of Bob Brinker, and thanks to him I exited the market in the brink no pun intended of time but …that is not the end of the story. Another special bulletin On November 5, , Bob Brinker issued a special bulletin to subscribers. He expected the rally to last between two to four months and continue into the first quarter of I felt uncomfortable making this trade so I only invested a small portion but many subscribers followed his advice and invested half of their cash reserves waiting for this so-called countertrend rally.
Countertrend rally This countertrend rally turned out to be a countertrend disaster. The countertrend rally never materialized but Brinker continued to advise for another 30 months that investors stay the course, and he never exited his position for 12 years.
Brinker never included the QQQ trade in his model portfolios and neither did Mark Hulbert of Hulbert Financial Digest, the magazine that rates the performance of investment newsletters. Had Brinker included the trade in his model portfolios, the actual returns would have been reduced by a sizeable amount.
It is also worthy to point out Bob Brinker totally missed the crash and subsequent bear market. He remained fully invested in all of his model portfolios. She began her blog because she was having the same experiences I was having with Bob. The intent of her blog was to keep Bob honest. She attracted many followers from disenchanted listeners. She ended her blog the week Bob retired from radio.
Summary Bob Brinker helped investors when it came to learning the basics about investing. I enjoyed his program and learned from him, but when it came to his own performance record, he would leave out important facts that were not in his best interest or just stop mentioning them.
Do you think Brinker would have included the QQQ trade in his portfolios if it had his expected outcome? Of course, he would have. But, he decided not to include it because it would have detrimentally affected the results of his model portfolios.
Market timers may tout their own special formula for beating the market, but the truth is no one can effectively time the market on a consistent basis. Make sure you do your own due diligence on any investment you make — understand what you are buying.
Bob Brinker retires after 32 years – Part 1
Bob Brinker’s Moneytalk Ending After 32 Years