Mark D. Goldstein, CFP®
Certified Financial Planner
SAFE-Money Alliance

Pueblo Plaza Executive Suites
1100 S. Main, Suite 10
Las Cruces, NM 88005
(575) 556-2472

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7362 Remcon Circle
El Paso, TX 79912
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3701 Algonquin, Suite 150
Rolling Meadows, IL 60008
(877) 442-0698 Toll-Free

"Guaranteed SAFE-Money Solutions for a Successful Retirement!"

My problem with most investment advisors is that they tend to be too expensive and are often conflicted. They'll charge 1% or more (of your total investment assets!) to "manage" your investment affairs. And brokers frequently charge even more, costing you 2% or 3% per year in fees.

Over time, those high fees will do enormous harm to your net investment returns. Making matters worse, it's been proven that past performance of mutual funds and money managers are essentially worthless in predicting future success. The hot performers of one period are typically the dogs of the next.

I'll admit that some mutual funds have recorded above-average performance for one or two decades in a row, but they are few and far between and their numbers are no greater than might be expected according to the "laws-of-chance"... rather than skill.

Example: Let's pretend we're engaged in a coin-flipping contest, in which those flipping "heads" are declared the winners, and we'll start out with 1,000 participants.

Okay, the contest begins and our 1,000 contestants flip their coins. Just as would be expected by chance, 500 flip heads and are allowed to advance to the 2nd round and flip again.

Once again, no surprise as 250 flip heads.

Operating under the laws-of-chance, there will be 125 winners (head-flippers) in the 3rd round, 63 in the 4th, 32 in the 5th, 16 in the 6th, 8 in the 7th, and 4 "miraculously" survive the 8th round!!!

By now, huge crowds have gathered to witness the supernatural ability of these expert coin-flippers. The winners are overwhelmed with adulation, celebrated as coin-flipping geniuses, non-stop TV appearances, multi-million dollar book deals, and millions of people urgently seeking their advice (after all, 1,000 contestants competed, but only 4 were able to consistently flip heads... 8 times in a row).

The point of my analogy: I'm not implying that investment advisors and mutual fund managers should make their recommendations by flipping coins (although it probably wouldn't matter much). But the fact is that the laws-of-chance do operate and with the large numbers of players in the money game, the laws-of-chance can explain the occasional extraordinary performances.

It is simply unwise to count on any fund or any investment manager to consistently beat the market, even when past performance suggests some unusual skill.

So, the question you need to ask yourself is, "What value am I actually receiving in exchange for the fees I'm paying?"

Shameless plug: Oh, by the way, I don't charge fees. Never have, never will. And I've never had a client lose money. Ever.