The Secret to 20% Returns for More Than 20 Years

What’s it going to take?

When will mainstream investors say enough is enough?

In recent years we’ve seen study after study revealing how the financial services industry has been giving individual investors the shaft with a smile.

Yet each year mom and pop investors continue to blindly funnel billions upon billions of their hard-earned dollars into the same rigged system.

But could a recent Financial Times article actually be the tipping point?

A Dirty Little Secret

The latest evidence to further savage the financial services industry’s reputation comes from the U.K.’s Financial Conduct Authority (FCA).

The Financial Times reports that the FCA has just published a 200-page report revealing that the asset management industry is bilking investors out of billions.

The scam that Wall Street runs on mainstream investors in the U.S.? Ditto for the U.K.

The fleecing boils down to this:

  1. Asset management fees are way too high compared to delivered benefits
  2. Investors aren’t told how much they’re actually paying to invest
  3. Asset managers don’t beat their benchmarks

Basically, mainstream investors pay a fortune for essentially zero performance tied to skill—on both sides of the pond.

It’s an insiders’ deal dream come true consistent for decades.

In fact, more than 50 years of research reveals that fund managers’ stock-picking acumen is a dice roll at best, and at worst straight theft.

As behavioral scientist Daniel Kahneman’s groundbreaking work revealed, at least two out of every three mutual funds underperform the overall market in any given year. And the educated guesses of “expert” fund managers are blind guesses.

It’s the investment industry’s dirty little secret, the secret that keeps them rich no matter what.

But when Wall Street owns the casino, there’s very little that small-time investors can do about it.

The Wall Street casino’s operations are specifically designed to separate you from your cash through exorbitant fees, hidden costs, misleading marketing practices and high-frequency trading systems that run circles around individual investors.

Remember, the house always wins if you play their games.

How to Achieve “Astonishing” Returns

But there’s some serious inconvenient timing in the Financial Conduct Authority’s scathing indictment of the financial services industry…

That’s because it was revealed around the same time as Tim Price’s new book, Investing Through the Looking Glass: A Rational Guide to Irrational Financial Markets.

Price has been a repeat guest on my Trend Following Radio podcast. He’s an author and Director of Investment at PFP Wealth Management.

Price not only skewers incompetent fund managers in his new book, but he also provides a solution near and dear to my heart for those who want out of Wall Street’s casino for good…

And it’s through rules-based trend following investing.

Price recommends investors follow a trend following approach, calling the returns “astonishing.”

And here’s his proof: Eleven funds have been in business for at least 20 years and have generated, on average, over 20% annualized and audited returns. Six of those 11 are systematic trend-following funds.

That type of outsized performance is no accident.

And it should provide hope to average investors looking to escape the continued manipulation of the mainstream investment industry.

You no longer have to sit back, be abused by a rigged system and trust that they will take care of you in your golden years.

You can walk away from the establishment’s investing roulette wheels and slot machines, the slave system they keep millions chained to.

Wresting control of your financial future today to become a trend follower does not guarantee you will join Warren Buffett as the next member of the super rich.

But it does guarantee that you will have an element of control, and your freedom, on the path to above average returns.

You don’t have to be Wall Street’s sock puppet.

Please send your comments to me at Let me know what you think of today’s issue.


Michael Covel
for The Daily Reckoning

The Daily Reckoning