Liquid Millionaire, drying up?

[sigmund1]

It's been a few years so how are the Sutherland Boys performing these days?

According to their performance records on their web site not real well.

They and their clients must be feeling the pain of underperforming their original 2007 benchmark, the Nasdaq.

But why change the benchmark to the FTSE? could it be that the Nas has outperformed their fund picking and switching abilities...ouch!

In fact the SP500 and just about every other sector has returned around twice what the Sutherland Boys have managed for their clients.

If the Sutherlands were that good why didn't they take Warren Buffetts $1,000,000 challenge?

There's a reason why switching and ditching funds underperforms, something the Sutherland Boys and their clients are finding out.

 

[sigmund1]

Liquid Millionaire, ISACO, are they worth £2500 pa.

The long term performance results of the Sutherland Bros, aka ISACO found on their web site claims...total returns 121% from 31 Dec 1997 t0 31 Dec 2015.

The Sutherlands will share their fund picking selections with anyone who gives them £2500 per year. Is this good value?

Over the same period of time the SP500 + Divs returned 194%. and over exactly the same time period the Nasdaq minus Divs returned 245%.

Both index's easily outperformed the Sunderlands performance.
It appears the Sunderlands are costing their clients money.

As someone once said, a fund manager is usually an investors worst enemy.

Why would anyone hand over £2500 per year to underperform the market?
Have the Sunderland Bros found people with more money than sense?

Anyone buying a low load tracker fund could have do much better than the Sutherlands fund picking method and saved themselves a ton of money in wasted fees at the same time.

 

[sigmund1]

Liquid Millionaire, sorry I made a mistake.

Apologies, in a previous post I wrote that the Sutherland Bros charge their clients £2500 per year.

On page 92 of their book Liquid Millionaire it states that the yearly cost to their client is, (take a deep breath) £3000 per year.

Right now I don't know whether to laugh or cry.

 

[sigmund1]

Sutherland Bros blowing their trumpets

Nobody does it better, at least that's what the Sutherland Brothers think!

Dotted around their 2 books the reader will find performance comparisons of how well their selected funds performed.

Looking closer we find that these selections were made during the 2003 to 2007 BULL MARKET run up.

Big Deal, everybody makes money in Bull Markets, even idiots!

And no-one needs to pay you £3000 per year for that information.

But here's the fly in the Sutherland's ointment.

When the market topped out in 2007 the Sutherland's and their clients got burnt in the crash just like every one else.

REMEMBER the Sutherland's sales pitch, when the markets are going up we stay invested and when they go down we GET OUT.

Yeah, sure mate and you probably think you went to Hogwarts School for Wizards.

S
lol.

 

[sigmund1]

Liquid Millionaire, can't do that!

Sutherland's book, How To Make Money In...page 14.

"My worst year was in 2008, when I made a loss of 42.3%"

It's obvious to me.

You got caught out like everyone else!

You stayed invested like everyone else!

So much for your hype about parking your clients money!

Did you refund your clients subscription fees?

 

[sigmund1]

red flags

Liquid Millionaire page xxvii the first red flag warning.

You will find a graph of the Nasdaq with a bullish cup n handle formation overlaid.

The graph ends around the Autumn of 2007, the Sutherland’s at that time were BULLISH on market direction and have placed a dotted arrow pointing northwards.

It’s all history now, a few weeks later the markets crashed...so much for the cup n handle.

Second red flag warning is found on page xxix, a quote from a book, Nanotech Fortunes by Darrell Brookstein.

“Beginning some time between 2006 and 2008 the US and other countries worldwide will experience the first of many nanotech stock booms”

How wrong can you be...lol

These 2 things point to the Sutherlands flawed thinking and why they returned a 42% loss for their clients during the 2007 crash.

The Sutherland’s were convinced of the accuracy of Cup n Handle formations and all it took was the reinforcement of Broostein’s book to really convince them of that.

This is why when the market finally topped and tanked the Sutherland’s just froze like frightened rabbits in a cars headlights unable to accept what was really happening.

They had convinced each other that the markets were in an unstoppable BULL cycle when the reality was just the opposite.

The first point when the Sutherland’s should have exited was at the 20% loss level, a well accepted CRASH point but they just stood there while the market hit the 25% the 30% the 35% the 40% loss levels.

That’s a crash level times 2...good grief, talk about psychological biases.

Who needs people like that advising you on money matters.

 

[sigmund1]

Einstein's calclator

You’ll find a number of charts in Sutherland's books along with their back slapping commentary of how well they did during the 2003- 2007 bull market.

Now lets look at an article from This Is Money by Ed Monk written in 2014.

Ed writes that anyone who bought a simple low cost FTSE tracker fund in 2003 and held it till 2014 would have realised a 218% return with dividends.

Recall the Sutherlan's could only manage a 121%. return over an 18 year period.

That 12 year performance for a no-brainer FTSE tracker is almost double the Sunderland’s 18 performance.

But don’t forget, the Sutherlands expect you to give them £3000 PER YEAR...that’s £3000pa you could be adding to your simple dumb no brainer tracker.

It doesn’t take an Einstein with a calculator to work out the better deal.

 

[sigmund1]

Index's out perform you again

On page 12, Sutherland’s second book... How to Make Money In....

“From Dec 31 2008 to Dec 31 2013 our portfolio annualized 14.5%”.

BIG DEAL, DURING THE SAME TIME PERIOD.

SP500 WITH DIVIDENDS 17%.

NASDAQ WITHOUT DIVIDENDS 19.90%.

Looks like the Index’s outperformed you again!

 

[sigmund1]

Doesn't make sense

DOESN’T MAKE SENSE.

Liquid Millionaire book page xxxvii there’s a paragraph written by Paul Sutherland.

“ As well as correctly predicting the start of the powerful five year bull market that begun in March 2003, he (Stephen) also correctly called the bear market, quickly moving into cash based fund many months before the 24.7% market falls from Oct 07 to March 2008. That skilful decision helped his clients to preserve and protect their capitol in a very challenging period”

HANG ON A MINUTE, HOW CAN THAT BE!

Paul, you need to talk to your brov, or maybe you should have gone to Spec Savers.

FYI...Steven has already stated on page 14 in your second book... quote... “my worst year was 2008 where I made a loss of 42.3%”

You can’t have it both way’s.

So which is it?

 

[sigmund1]

Only fools and morons

ISACO’s WEB SITE YOU WILL FIND THE STATEMENT, ”8-10% ANNUAL AIMS”.

IS THAT INFORMATION WORTH £3000 PER YEAR?

ONLY A MORON WOULD THINK SO!

THE LONG TERM RETURN FOR THE SP 500 IS A BIT OVER 9%.

HAVE I GOT THIS WRONG OR WHAT.

THE SUTHERLAND’S ASK £3000 PER YEAR SO THEIR CLIENTS CAN GET THE SP500 TRACKER RETURN.

THAT’S JUST PLAIN RUBBISH!

I WONDER HOW MANY IDIOT’S HAVE FALLEN FOR THIS OVER THE YEARS.

 

[sigmund1]

Day dream believer

Liquid Millionaire book.

Page 63, “I have used a 30 year long growth target of 17.5% which is my best estimation of what is achievable over that length of time span”...failed!

Page 51. “I reckon with some fancy fund picking and a touch of good luck you could make close to 30% annualised returns”...mega day dreamer!

Page 10, “I decided to bet the ranch”...sounds like a gambler!

Page xlix, you want to be teamed up with a person who can deliver the goods year in year out”...do you know any?

Page 92, “It puts them at ease when they find out my track record”...what you been smoking?

 

[sigmund1]

It's Not the FTSE.

Recently the Sutherland’s use the FTSE as their benchmark.

This is WRONG!

If you are investing in Japan...it’s NOT the FTSE.

If you are investing in China... it’s NOT the FTSE.

If your investing in North America... it’s NOT the FTSE.

Stop being a pair of doughnut’s and use the correct associated benchmarks.

In their 2007 book Liquid Millionaire, there is no mention of the FTSE, but there is a lot of talk about the Nasdaq.

Psst...Want to know a secret...they failed to beat the Nasdaq.

 

[sigmund1]

it's 10%

According to Hargreaves Lansdown the multi decade long term average return of the FTSE 100, FTSE 250, DJIA and the SP500 when combined is 10%.

FTSE 100 around 9% with Divs.

FTSE 250 around 10.5%. with Divs.

DJIA around 11.5% with Divs.

SP500 around 11%.with Divs.

Average = 10% with Divs.

Talking of Divs that reminds me.

Seeing that the Sutherland’s long term performance over 18 years actually underperforms all these Index’s, then what are the Sutherland’s doing for their clients that’s worth £3000 per year?.

 

[sigmund1]

ISACOS long term performance found on their web site 121%.

OK, then how is it that the SP500 OUTPERFORMED you by 73% over the same period of time?

And the Nasdaq OUTPERFORMED you by 124% same time period?

Found in the Introduction Liquid Millionaire.

"Because of my absolute certainty and belief in my abilities"

I showed this to our Nan and she said you sound like a Ruddy Big Head.

 

[sigmund1]

nice little earner

ISACO look for people with a min of £250,000 to invest.

ISACO charge £3000 per year for investment advice.

£250,000 in a simple SP500 tracker fund would have returned around £704,000. over the 18 years.

But Wait, every client would have to fork out £3000.

That's £3000 per year LESS to INVEST.

That knocks around £100,000 off of what they would have got over those 18 years.

But Wait Again, ISACO don't keep up with the SP500, that's even less money...good grief.

But Wait Again...it gets even worse for their clients.

That £3000 their dopey clients shell out, means the Sutherlands can invest that in their personal account.

That means they made over that 18 years an extra £230,000 over what the client gets.

Our Nan said, "are people really that silly".

 

[sigmund1]

read em and weep

The Sutherland’s seem to have an almost evangelical fervour towards Bill O’Neil found in both their books.

Stephen and Paul are really impressed with the founder of the CANSLIM method of trading, that’s because rumour has it that you can get very, very rich using it.

Supposedly O’Neil made a ton of money in the bull market of the early 1960’s following a system previously used by Nick Darvas in the bull market of the late 1950’s.

I mean, lets face it, making money in a bull market. If you can’t do that it’s time to buy a cash ISA!

So, this CANSLIM method is the dogs nuts.

Would'nt it be great if there was a CANSLIM FUND, we could just buy it, sit back and make a Zillion quid.

Well Brother, it’s good news time, there is a CANSLIM FUND, Hallelujah.

It’s called CANGX.

Morningstar tell us it’s a mid cap growth fund...(message for Steven Sutherland...IT’S NOT THE FTSE)

But Wait, lets look at the returns of Vanguard’s Mid Cap Growth Fund

No, no, no that can’t be!

Vanguard outperforms the CANSLIM Fund around 3% Per year.

Oh Pooh Sticks...the Passives win again.

 

[sigmund1]

Soft in the Head

Quotes from Warren Buffett.

1. Trying to time the market. “People that think they can predict the short-term movement of the stock market — or listen to other people who talk about (timing the market) — they are making a big mistake,” says Buffett.

2. Trying to mimic high-frequency traders. Buying stock in a good business and hanging on for the long term, he says, is a better strategy than flipping stocks like a short-order cook flips pancakes.

3. Paying too much in fees and expenses. There’s no reason to pay an expensive management fee to invest in a mutual fund when super-low-cost index funds that mimic large indexes like the Standard & Poor’s 500-stock index are available, he says.

“If they’re trading actively they’re making a big mistake”...Adam Shell, USA TODAY 6:06 a.m. EDT October 26, 2013.

Quotes from the Sutherlands...Liquid Millionaire. Page 1.

"Switch out of the market when the trend is down".

"You do not buy index tracker funds because it is possible to beat the index’s if you know what you are doing".

Well, you got to hand it to the Sutherland Brothers they think they know better than the greatest investor of all time.

Not only better but recommend doing exactly the opposite!

AND DON’T FORGET, THEY EXPECT YOU TO HAND THEM £3000 A YEAR FOR FLAWED INFORMATION.

Our Nan say’s, they're soft in the head.

 

[sigmund1]

Below a message from Steven Sutherland going back 3 years. You can find it...post 59...July 2013.

The Sutherlands have had 3 years to make this promise good and as much as I look I just can't find any audited account of their performance.

Brother Paul and Brother Stephen must be very busy people with their charity work!

"After consulting with our finance director, and in the interest of our clients, prospects and future clients we feel it would be best that if we were to officially audit Stephen’s ISA Stocks and Shares ISA account, it would be best conducted by one of the four largest accountancy companies in the UK. The result of this would be a completely unbiased and transparent audit. I will be signing off now as I feel we have covered all the points brought up.

Please post future comments and questions to my personal email account paul (at) ISACO.co.uk

Also as I’ve mentioned on quite a few occasions now, if you prefer please feel free to call me on 0870 757 8554.
ISAs is offline Other (Please email T2W with details) Report Post Like ISAs's Post Reply With Quote"

 

[sigmund1]

Psst, want know a secret

Want to know how the Sutherlands pick their funds?

Brother Paul and Brother Stephen call it a "secret formula"....page 98 LM.

Our Nan calls it something else!

1. The fund must have outperformed the Nasdaq over the last 1 and 3 years.
2. Must be a big market cap.
3. Must have long term management.
4. Style 95% long.
5. Not all in one sector.

Our Nan just said... "to remind you about the AUDIT"

 

[sigmund1]

how can that be?

Page 146 Liquid Millionaire...

“On Feb 28, 2007 my clients and I exited the market”...."the trend had changed from an up trend to a down trend”.

BUT WAIT...on page 14 in their 2nd book How to Make Money In...

“My worst year was in 2008 when I made a loss of -42.3%”.

HOW CAN THAT BE?

If you were out the market in 2007 how could you make such a large loss in 2008?

Our Nan said...like a silly boy on a Sunday he must have got back into the market just as it tanked....( rye smile, tut, and roll the eyes)

There’s no flies on our Nan!

Oh, our Nan just said...DON’T FORGET THE AUDIT.