Comment Left By Paul Winkler A.K.A The Investor Coach

Here is the comment left by the man himself, Paul Winkler, about my post titled
Conventional Wisdom is Wrong When It Comes to Picking Mutual Funds

Brent,

Thanks for your mentioning my influence on your thinking. The fact that you started so young in your pursuit of investing is impressive.

Unfortunately, the investing industry has a big vested interest in investors believing many of the myths dispelled in this article. The fact is that investors believe that the investment world works like virtually everything else in their lives - namely, that past performance is an important criteria for judging future performance. Think about it. If you want to judge who will perform well in college, you would look at their high school transcripts. The same is not true in the world of investing because good past performance is more of a function of luck, not skill. If it were skill, we would find more persistance among managers. In other words, their success would be repeatable. The evidence is to the contrary.
So how does one invest? By focusing on successfully capturing the returns that markets tend to deliver over time. Quite simply, the capital markets exist to bring people in need of money together with people who have money to invest. It is not the job of the advisor to try to outperform the returns that different areas of the market deliver. Their job is to make sure that every investment vehicle used is as efficient as possible in delivering those returns to the end investor.

Paul Winkler, ChFC
Accredited Asset Management Specialist

Posted by: Brent Crouch on 15 Mar, 2008No Comments »