Buy & Hold Everything Wall Street’s investment strategy is ‘buy and hold.’ Wall Street makes money by having your money in the market. If your money is in cash then they cannot charge you all the fees that they do. This would not go over well for 99% of these companies, because they need to hit their quarterly numbers. Therefore, they teach ‘buy and hold.’ Wall Street even says, ‘if your money is not in the market’, it is not working. A complete lie, but one that people easily believe. Are You Confused? Good. Wall Street’s goal is to confuse you into looking to them for help. Case in point, Fidelity Investments, one of the largest Mutual Fund Companies in the world, has 24 mutual funds that are all ‘Large Cap’ mutual funds. It doesn’t matter if you do not know what that means; the point is, they all do the exact same thing and return the same results but are called very different names. Why is this confusing, 24 funds doing the exact same thing? Multiply this by 300 mutual funds and you’ll start to get the idea. The Definitive Money Guide – Wall Street Sheet Career Risk Career risk is Wall Street’s number one concern. It is safer for Wall Street to have your money stick close to the benchmark then actually beat the benchmark. Because if Wall Street attempts to beat the benchmark and fails, then you, the client, will most likely ‘pull’ your money from that manager and give it to another one. But if the manager mirrors the benchmark and you lose money, the manager will simply point out to you that the benchmark fell and your money didn’t do any worse. Expect Mediocrity Wall Street teaches its clients to expect mediocrity by teaching them “Benchmarking.” Benchmarking is when you compare your results to the results of a sector or country’s stock market index. So if the benchmark (sector or country index) falls 40% as it did in the US in 2008, then that money manager is going to make sure your money grows (or in this case falls) at exactly the same rate, plus or minus 1%. So then when you call, he/she can point out to you how your money was within 1% of the benchmark. Never Try To Win Wall Street cannot beat the S&P 500. Wall Street cannot beat “the market” because they are not trying to beat it! So if you are going to a Wall Street person to grow your money you are better off just buying the S&P 500 (the market) and saving all the fees you would have paid to that nicely dressed money manager/financial planner. 1 2 3 5 4 What is the one thing you want to remember from this sheet?