Masters of the Universe: Fund Managers

The truth is, very few money managers, if any, can consistently beat the market.

Larry Swedroe, director of research at Buckingham Asset Management in St. Louis and author explains in the video below how…”Past performance has NO predictive value whatsoever,” Swedroe argues, jabbing at the SEC disclaimer that ”past performance is no indication of future results.”

Even though conventional wisdom compels people to put their investments with managers that have great track records, Swedroe says the problem is there is no way to differentiate between luck and skill, or to know why and when a certain manager will lose the magic touch. He says reams of data and studies suggest that stock picking is a very poor strategy for individuals and professionals alike.

“Yesterday’s masters of the universe are most often tomorrow’s cosmic dust,” Larry concludes.

Trying to pick winning fund managers and winning stocks is a fool’s game. Larry’s solution is the same as mine….own a passively managed diversified portfolio and (this is the hard part) have the discipline to stick to it. Check out this 5 minute video.

As a wealth strategist specializing in retirement planning and estate planning, this is one of the issues that hits close to home for many of our clients and friends here in central PA. They can not afford to have someone gambling and speculating with their life savings. Pay for coaching not for products.

About Paul Nichols

Paul is the founder of Financial Abundance, a Registered Investor Advisory firm and EDI, an Estate Planning Firm with offices in State College and Lewisburg. He has been working with individuals, families and businesses for over twenty years, including many Fortune 500 companies. He has educated tens of thousands of people through seminars, workshops and various international speaking engagements where he shared the stage with many notable individuals such as Ronald Reagan, Robert Kiyosaki (author of Rich Dad, Poor Dad), Mike Ditka, General Schwarzkopf, and Newt Gingrich to name a few.

In 2000, after many years of traveling to consult companies and individuals, Paul decided to relocate from Colorado to State College, PA (his wife’s hometown) to develop a local advisory firm.

Paul operates under the core belief that education plus understanding leads to clarity and confidence; resulting in peace of mind. He is a proud father of three and devoted husband of 20 plus years.

Some of Paul’s accomplishments:
Regular contributor to the Centre Daily Times, via the “It’s Your Money” blog
Featured in the movie Navigating the Fog of Investing
Regular contributor to Town & Gown as the publications Investor Coach
Host of the weekly iTunes Podcast, It’s Your Money
Member of the Western PA Better Business Bureau
Member of the Centre County Chamber of Business and Industry