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FAQs
Q: Why should I trust you?
A: You shouldn't. You shouldn't trust me or anyone else with
the future of your investments. At least, not right away. Check
it out first. Take your time.
Make sure you have the proper structure in place. There are two
important parts to this. First, only pay for what you get. And
second, place your investment funds with an established,
reputable company.
Panhandle Portfolios charges you $30 for a month’s access to
everything on our website. You pay just for what you get. You
can cancel anytime. There are no refunds. The most you can lose
is $30. To receive a sample of our detailed full reports that are
available to paid subscribers click
HERE.
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Q: Why do I need you? I have a broker who gives me advice and
invests my money in mutual funds.
A: You don’t… UNLESS
- you need more income
- you want investments you can understand and manage
- you want to outperform the markets
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Q: How can you help me invest?
A: Two ways, your choice. If you like to manage your
investments, we can help you build and manage a high income
portfolio. And second, you can invest in our high income fund
and we can manage it for you.
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Q: Why do you think you can outperform the market?
A: Outperforming the market is easy. But it requires you
adopt a difficult mindset. You must be willing to be different.
If you want to be like everyone else, expect to perform like
everyone else, which is the market less costs.
I am very willing to be different. I buy when the crowd is
selling and I sell when they are buying.
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Q: Why should I pay you?
A: You get step-by-step instructions on how to build and
manage a high yield portfolio from an experienced, qualified
portfolio manager. You get detailed independent investment
research that you will not find anywhere else. To receive a
sample of our detailed full reports that are
available to paid subscribers click
HERE.
We think this is a unique and extremely valuable service. The
cost is the equivalent of one dollar a day, which is modest
given the quality of this service. Please read the commentary
entitled,
Investment Advice Is Like Dining Out.
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Q: What’s a portfolio? You talk a lot about portfolios. Why is
this important?
A: A portfolio is like your house. Your house is a
collection of rooms, each with different characteristics, size,
and function. But they are all connected and, together, they are
much more than just a collection of rooms. Together, these rooms
accommodate your family and provide a variety of services.
A portfolio is similar. It is made up of different
investments all working together to accomplish your goal. Each
investment is different… different industry, business, markets,
capital structure and risk profile. But unlike your house, all
rooms in a Panhandle Portfolio are the same size.
You do not add rooms to your house without a great deal of
thought, planning and preparation. Otherwise you end up with a
hodgepodge of rooms, unrelated and disconnected to each other.
Most mutual funds are managed this way. Its common to have over
100 holdings ranging in size from 5 or 10% down to miniscule
positions of a fraction of one percent. New positions are
routinely added to the already too long list.
It reminds me of the old Vermont farm house I roomed in
while I was in college. It had rooms without interior access and
bathrooms in the hallway.
A portfolio is the same. I will not add another investment
to the portfolio unless it improves the overall portfolio. The
way to ensure that is to insist no new investment can be added
until an existing one is sold. The portfolio contains only ten
investments. Setting a rigid limit to the number of investments
in the portfolio is called “sell discipline” and is one of the
most important rules in portfolio management.
Building a portfolio is a construction project. It is similar to
building a house. And managing the portfolio once it is built is
also like maintaining your house. Once the house is built, the
work is not done. Your house needs to be maintained. The yard
needs to be mowed, the driveway shoveled in winter, the mail
collected and so on.
A portfolio is the same. We monitor and collect the interest and
dividend due, we invest the cash and regularly rebalance
portfolio holdings.
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Q: Why aren’t your portfolios more diversified?
A: Panhandle Portfolios are both concentrated and
diversified. Diversification is important and necessary.
The problem with most funds is they are over diversified. This
ensures worse than market performance. It ensures limited impact
from research, wasting valuable resources.
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Q: You sign your name with three letters after it, CFA. What is
a CFA?
A: A CFA after your name means you are a Chartered Financial
Analyst. It is the designation awarded by the CFA Institute to
all who successfully demonstrate a thorough knowledge and
understanding of the economic and financial issues influencing
investments. It is the ultimate recognition of a qualified
financial manager.
It is not awarded lightly. A candidate must pass three
comprehensive exams one each year consecutively for three years.
The success rate is about 50% for each level of exam. On average
there are 12.5 CFA’s awarded for each 100 candidates that begin.
I received my CFA award in 1990.
I am required to adhere to a stringent Code of Ethics. As a CFA,
I accept a fiduciary duty between us, which means I must ALWAYS
put your interests before my own.
In short, these three letters behind my name means I can be
trusted to give you the very best investment advice and service
I can.
As important as it is, it is meaningless unless it is combined
with years of practical experience.
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Q: Do you have references?
A: Sure. But why would you want them? Anything I show you is
somebody else’s opinion. References are someone else’s opinion,
just like performance is someone else’s money. What matters is
your opinion and your money.
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Q: Where is your performance record?
A: This is the wrong question. A performance record is the
record of somebody else’s money, not yours. If it was your
money, you would not ask.
I was an international pension expert responsible for several
billion dollars of my employer’s pension assets in four
countries, Australia, UK, Canada and the US. I assure you
performance was a daily tool and not an academic issue for me. I
understand fully its importance and its pitfalls.
I have written extensively about performance and its many
potholes, such as "survivor bias". I explain my position on
performance HERE.
Performance is the ultimate measure of the contribution of a
fund manager, so it is important.
But if you think performance is the first and only question,
this site can not help and I wish you well in your search for
the best performing manager. Let me offer you a parting gift of
an observable and repeatable fact in the financial markets. The
best performing manager this year will never be the best
performing manager next year. Hire him if you dare.
The right question is “How is my high income portfolio going to
perform this year and next?” If you have established objectives,
it is easy to measure. You know what the income is as you
receive it on a regular, quarterly basis. You will be able to
follow the value of your investments every month, when we post
monthly results. And every calendar quarter, I will review and
analyze and post our portfolio performance.
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Q: There are lots of CFA’s. Why are you better than all the
others?
A: I’m not. A CFA simply tells the world you are qualified
to manage investments. It does not mean you are any good at it.
There is no school to show you how to take advantage of greed
and fear. Only experience shows you how to be "greedy" when
others are fearful and to be "fearful" when others are greedy.
There are very few investment managers with operating
experience. While they know volumes about a company, they don’t
know how to meet a payroll. They don’t know the importance of
qualitative issues such as customer service. They don’t know the
damage that can be done by poor pricing strategies.
I do. I have established, managed and grown several companies in
different businesses. They ranged from commercial real estate
brokerage in New Hampshire to recycling electronics in Beijing,
China.
I have struggled with the same investment and portfolio issues
you struggle with. I analyzed, dissected, and evaluated hundreds
of investment strategies. I interviewed hundreds of very
successful investment advisors in a wide variety of products,
from options strategies to international emerging markets
equities. I managed these managers. So I am knowledgeable in
many investment strategies and how and why they work.
There are very few CFA’s with the wealth and variety of
experience I can offer.
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Q: Why do you use the words of Solomon to guide your research?
A: I find the Bible a valuable guide to understanding
markets and investments. Solomon’s words assure us markets go in
cycles. This is powerful base to understand and address periods
of dark pessimism when capital values are declining and periods
of wild optimism when markets have exceeded all boundaries of
normal understanding.
Proverbs offers many financial guideposts as well, such as "He
who gathers money little by little shall make it grow". This is
a practical and suitable financial plan for most of us. |
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