Common Sense Strategies for
Successful Equity Management
1.877-970-5663 Email

As you saw from my last blog – computers trading with one another accounts for half the volume of market. For the most part, nothing “real” is being traded and this creates the incredible volatility we see every other day.

That’s ok because we can use this to our advantage and create a fortune in retirement income.  Over the last 12-18 months many of my clients have seen permanent gains in the 20% to 50% range because of a built in strategy that allows you to capture market rebounds while the funds are guaranteed against market losses.

This is achieved by a special feature called “Annual Reset”.  Here’s how it works:

Example – You start with $100,000 in 2008.  The Dow is at 10,000.

From 2008 to 2009 the Dow drops 40% to 6,000.  You still have $100,000. 

Now from 2009 to 2010 the Dow shoots back up 40% to 8400. You net $138,000. (Insurance company takes 2% of the gain.)

While most people are still trying to get back to even, you pocketed a big gain. This gain is permanent and cannot be lost in future years due to market downturns.

It is important to do this as soon as possible. If the market was bad for you over the last 10 years, just wait until the next 10 years. Protection is common sense.

If you have sat down with a financial planner in Phoenix or anywhere in Arizona, the financial planner has proabaly told you about all the sophisticated computer modeling they use that is supposed to make you lots of money.  As it turns out, all the computerized financial planning strategies may make you much worse off.  If you have money in the market this could be the most alarming article you will read this year.  Please take a few minutes to read this article and share it with those you care about.  This could help you make a decision on protecting your life savings or the savings of someone close to you.

 The article is titled “Computerized stock trading leaves investors vulnerable”.  As you’ll see “vulnerable” is an understatement. Here is the full article as well as some highlights below:

http://www.azcentral.com/business/articles/2010/07/09/20100709computerized-stock-trading-leaves-investors-vulnerable.html

Highlights: 

• The day the Dow Jones industrials plunged nearly 1,000 points and then recovered in Wall Street’s most volatile half-hour ever, more than 19 billion transactions moved according to regulators.
• The time it takes to read this sentence is all it takes for nearly 2 million stock trades to flash through the stock market.
• Trades are coming from an army of computers programmed to obey complicated algorithms that are hyperactively buying and selling.
• These machines see stocks not as securities used by companies to raise money, but rather, symbols, numbers and bits that are traded, swapped and exchanged. 
• More than half of the market’s volume is churned by computers programmed to spot certain patterns in trading. 
• And now, traders say, humans are responding to machines rather than the other way around. 
• More and more the machines are reacting to each other, trying to second-guess what their next moves might be on how to take advantage of an edge that might be gone in milliseconds. 
• “There are no real buyers or sellers,” says Joe Saluzzi, trader at Themis Trading. ”
  It’s all about the machines.” 
•   Perhaps most troubling is how computers are giving sophisticated investors with the best digital access to the markets a leg up over regular investors in ways modernization was supposed to do away with. Meanwhile, technological advances are making it nearly impossible for regulators, who play a critical role in maintaining a fair market, to monitor the system that by its very nature has no paper trail and buries transactions in mountains of data.

After you read this, you’ll see why it is so important to have your money guaranteed against market losses.  I can set this up for you. Call me directly at 480-970-5663.

Check out the statistical probabilities that an event is likely to happen in an average year:

Loss of life: 0.9%
Loss of car due to auto accident: 1.2%
Loss of home due to fire, weather, etc: 1.3%
Loss of market value in retirement accounts: 28%

As you can see the loss of market value is the biggest risk. This statistic is based on the S&P 500 from 1959-2008.
Common sense would suggest you have a built in floor to protect you from market losses using the insurance products we suggest on my radio show.

Call me or email me with questions or to schedule a free consultation. My direct line is 480-970-5663.

Top 3 Mistakes in Personal FinanceHere are the top three mistakes that consistently destroy wealth in retirement accounts:

1.  Not looking at your retirement account statements.  Many people are afraid to look at their accounts because they don’t want to see how much they have lost….they also think what’s the point because they don’t know what else to do….and even if they did know what to do they are so far down they think they need to wait until the market comes back up to do anything.

 2.  Not getting educated on the options available.  This is a tough for you because most of the information given out by financial advisors it flat wrong. (Just look at your retirement accounts for evidence of this.)  For a real independent, third party look at what you can easily do to eliminate market risk from your retirement accounts and grow them dramatically read “Blind Faith: Our Misplaced Trust in the Stock Market and Smarter, Safer Ways to Invest” by Edward Winslow. It is available at Amazon.com or come into the office for a free consultation and I’ll give you a copy to read. 

3.  Not taking control.  Most people feel they are at the mercy of the market. After you get educated you began to realize you do not need to play the “hang on it will turn around game.”  The most important thing right now is not the money in your account. It is protecting that money from future losses (which will probably be bigger this year than last year) and getting that money into positions that are going to make you money when the market goes up.
 

Will conventional wisdom work for you?  The odds are about 29% that it will.  Standard conventional wisdom taught by most financial advisors is diversifying your portfolio.  As you are younger you take more risk with investing. As you grow older you move more into safe investing. 

Unfortunately the odds of this strategy succeeding in building you a large nest egg is about 29%.  (I think the actual success rate is probably even lower because the authors don’t take into account the fact that most people sell during low periods due to the emotional factors of losing money.)

Take a few moments and read this article: The odds for a retirement nest egg, recalculated. 

The authors used 80 years of marekt data and ran thousands of simulations.  Basically the authors point out that the strategy doesn’t work due to market volatility.  If you would like to learn more about how to eliminate market risk contact us here for a free video. 

Is life harder for the middle class? Recent studies show 8 out of 10 Americans say yes.  Here is the just released complete study:  http://pewsocialtrends.org/pubs/706/middle-class-poll

How do you make it easier?  Warren Buffet said “Never Lose Money. Ever.”  It is a myth that you have to take risk to grow your retirement funds.