Charles Givens investment strategy
Shidong Tong
I went to a Charles Givens seminar on Saturday. However, Charles
Givens was not there. The lecture was given by someone else.
The seminar lasted for two hours, first one and half hour was about
some common sense strategies, and the last half hour trying to sell
books and memberships.
There is a "30-Day Plan for Financial Success", which they claimed
if you follow his strategy, and if are not saving $1000, you can
have you money back. But I know it is easy, buy a second hand car,
you already saved $5000 :)
Anyway, instead of buying his book, I borrowed one, "Wealth Without
Risk for Canadians". Just browsed a few chapters, I have some
questions about his strategies. Hope you could enlighten me up.
> Chapter 24, The Money Movement Strategy
> Strategy #259, use only the no-load mutual funds.
Is it good advice ?
As I have heard that some load funds are very good, if you
in for a long term, the load is not that important.
> Strategy #262, invest in only one type of mutual fund at a time.
It means when the prime rate is:
high and going down, invest only in bond funds;
high and going up, invest only in money market funds;
low, invest only in stock funds.
Switch your investments when the prime rate changes.
Is that mean we should switch our investment every 3 or 5 years?
What I don't understand most is this:
> Strategy #242, Learn to recognize bad investment advice
>
> The Biggest Lies in the Investment Business
>
> "Stocks and bonds are a good long-term investment"
> There is no such thing as a good long-term securities investment.
> The best investment changes as the economy and interest rates change.
I have heard again and again that we should invest for
long term. Now Charles seems telling me not to ?
I am a grad student, I am new to investment. I followed
free advice, borrowed money from bank to but RRSP. Now
I am paying interest on the bank loan, my mutual fund RRSP
is losing money :( and my friend told me to sit tight :)
I have other questions in my mind, but I think I should stop now.
Thank you for your opinion.
--shidong
Curt McGinnis
>Subject: Charles Givens investment strategy
>Date: 11 May 1994 06:51:32 GMT
>Hi, there,
>I went to a Charles Givens seminar on Saturday.
>Strategy #262, invest in only one type of mutual fund at a time.
>It means when the prime rate is:
> high and going down, invest only in bond funds;
> high and going up, invest only in money market funds;
> low, invest only in stock funds.
> Switch your investments when the prime rate changes.
>Is that mean we should switch our investment every 3 or 5 years?
In the book "More Wealth without Risk", Mr. Givens defines the investor's
decision line (IDL) losely as a 9.5% Prime rate. If the current prime is
above 9.5 it is considered high - below 9.5% is considered low. He
says this is a rough estimate for the average economy. If you join the
"Given's organization", which I did not, they will keep you informed as to the
movement of the IDL.
In the book, he provides a chart of his money movement strategy using the
IDL as the basis for switching money from one type of fund to another. The
chart shows where your money should have been invested during the past 12 or
so years. If you study the chart, you can learn how his organization has
"played" with the the IDL. I have not seen the news letter from the Givens
organization, but I am guessing (based on my study of the chart) that the
current IDL is 8.4%. This means that when the Prime rate exceeds 8.4%, we
should (by their standards) move our money to the safe-haven (money market
funds). The IDL will not change until the Prime has moved well above the 8.4%
(but that is another subject all together).
>What I don't understand most is this:
> Strategy #242, Learn to recognize bad investment advice
>
> The Biggest Lies in the Investment Business
>
> "Stocks and bonds are a good long-term investment"
> There is no such thing as a good long-term securities investment.
> The best investment changes as the economy and interest rates change.
Stocks and bonds may well be good long term investments. But Givens' point is
that if you can "time" the market (big IF), you can do even better by moving
it around based on interest rates. Actually, he states that you don't even
have to buy at the ultimate low and sell at the ultimate high to beat it -
just get close.
We'll see. I'm waiting for the 8.4% before I get out of at least half of
my putrid (s?) stock funds. This may be a big mistake, but I would hate to
sell now while the prices are down.
If anyone is actually in the organization and receiving the newsletter, I
would be curious to see if my guess of the investor's decision
line is even close.
Curt
Scott McAllister
Their are many books that give good financial advise: Peter Lynch,
Gordon Pape, Martin Zweig ..etc. A good Canadian financial book
for the novice is "The wealthy Barber".
Many of these books and even financial newspapers give basically
the same info as Given. However, my opinion, about Givens organzation
is basically a scam oranization.
Sometimes Stocks and Bonds are affected by interest rates or the company's
competitive advantage. Bonds are basically affected by interest rates.
As interest rates rise bonds fall in value of price, As interest rates fall
bond prices rise. When you have low interest rates Bonds make profits
generally speaking so bonds have variations to interest rates.
Now stocks are always in flux depending upon gov't regulation -- i.e Drug
and Telecommunication stocks -- competitive pressures -- i.e. IBM
Software stocks ..etc, Technology. All these factors have affect on a stock.
For example, Railway stocks was the blue chip stocks of the early 20 century,
by the middle 20 century it became auto stocks and so forth.
Generally, stocks have outperform Bonds and other investments. Mutual funds
are handle by professionals who would allocate financial resources to each
financial catergory which favour investment -- stocks,bonds, T-Bills ..etc.
--
Vinnie 'the hitman' Belovich
>In the book "More Wealth without Risk", Mr. Givens defines the investor's
>decision line (IDL) losely as a 9.5% Prime rate. If the current prime is
>above 9.5 it is considered high - below 9.5% is considered low. He
>says this is a rough estimate for the average economy. If you join the
>"Given's organization", which I did not, they will keep you informed as to the
>movement of the IDL.
>
>In the book, he provides a chart of his money movement strategy using the
>IDL as the basis for switching money from one type of fund to another. The
>chart shows where your money should have been invested during the past 12 or
>so years. If you study the chart, you can learn how his organization has
>"played" with the the IDL. I have not seen the news letter from the Givens
>organization, but I am guessing (based on my study of the chart) that the
>current IDL is 8.4%. This means that when the Prime rate exceeds 8.4%, we
>should (by their standards) move our money to the safe-haven (money market
>funds). The IDL will not change until the Prime has moved well above the 8.4%
>(but that is another subject all together).
>
>
>>What I don't understand most is this:
>
>> Strategy #242, Learn to recognize bad investment advice
>>
>> The Biggest Lies in the Investment Business
>>
>> "Stocks and bonds are a good long-term investment"
>> There is no such thing as a good long-term securities investment.
>> The best investment changes as the economy and interest rates change.
>
>Stocks and bonds may well be good long term investments. But Givens' point is
>that if you can "time" the market (big IF), you can do even better by moving
>it around based on interest rates. Actually, he states that you don't even
>have to buy at the ultimate low and sell at the ultimate high to beat it -
>just get close.
>
>We'll see. I'm waiting for the 8.4% before I get out of at least half of
>my putrid (s?) stock funds. This may be a big mistake, but I would hate to
>sell now while the prices are down.
>
>If anyone is actually in the organization and receiving the newsletter, I
>would be curious to see if my guess of the investor's decision
>line is even close.
>
>
>Curt
I have some friends in the Given's Org and I have read several of their monthly
newsletters. There is a brokerage/economic analysis company (I don't remember
the name) which comes up with the 'investment advice' for the members. Of
course they are careful to always ascribe the advice to the wisdom of Mr
Givens. Anyway, there are two (2) Investor's Decision Lines (IDL). One is
based on the prime rate (but isn't the prime rate) and the other is based on
the 30 year treasury bond. The prime rate IDL is currently 9.5% and the 30
year bond IDL is 8.5%. The newsletter gives a chart showing the respective
IDLs and where the actual prime rate and 30 year T-bond rate are in relation
to the IDLs. Also, a statement is made giving the long term (predicted)
direction of each, e.g., up, down, or level. For the last few months the
stated direction is 'level.' A few months back I believe the prediction was
'up.'
I don't think there is any argument about the wisdom of the money movement
strategy. I mean, it is pretty well established that stocks generally fall
when interest rates rise, bonds rise when rates go down, etc. This is just a
way to--for lack of a better terminology--to 'time the market without
thinking.' It is a long-term timing strategy, which by definition may not be a
timing strategy at all, but that's how I look at it. Obviously, the ability of
the brokerage firm to do its analysis is very key to this strategy. And
assuming they do as good a job as
anyone else,
i.e., noticing a trend AFTER it happens [ ;)], then, the money movement
strategy is basically telling you to get into stocks just after they start
going up; get out, just after they start going down, and move to the
other invesments. It is probably better than a buy and hold strategy, but, if
you are good at picking individual stocks, or mutual funds, you may want to
follow your own advice.
J.R. Simms
If anyone is a member of the Givens organization, and decides
to respond to Curt's post, please post your response so all
of us may learn.
--
Crazy Pyro
initial introduction course - I think it was around $400. He saved me
a lot of money initially because I restructured my cars/home/life
insurance policies. You have to be real careful with this though. I'm
sure you all heard about the lawsuit against him for his car insurance
recommendations. You have to use your head. Hopefully, you have an
honest insurance agent you can trust because I wouldn't and didn't do
all the things Givens wanted me to do. You can save the most just by
raising your deductibles but make sure you have enough money to pay
it if something happens. A no annual fee visa card just for this
situation is great.
This is the only recommendation that I took advantage of besides a low
interest rate credit card which I found on my own and wasn't the one
he recommends. The annual fee on his card was horrendous - about $45
the last time I looked.
I don't agree with his investment advice. I've done a lot of investing
and I try to make my own decisions with the help of a mutual fund
newsletter called "Noload Fundx" which has worked well for me for a little
over a year.
I don't like their seminar policies. Everytime you go to one of those
seminars they offer, you always have to buy some package at the end in
order to get more information to do what they talked about.
I tried their mortgage company too when I was going to refinance when
interest rates got real low. The problem with them was, their fees were
so high. I got a much better deal at a local bank.
I just got kind of fed up with the whole organization. I think you can
learn enough hints just by reading his first book "Wealth Without Risk"
to save you plenty. Be careful with the insurances though. Don't go
overboard. Make sure you have a new life insurance policy in place
before dropping your old one, etc. With car insurance, I would investigate
the Uninsured/Underinsured sections of your policy before dropping them
like he recommends. I decided to keep these because it sounded too
risky to me.
So, as far as I'm concerned it was a waste of money. This is just my
experience/opinion.
Ray
Charlie Preston
> With car insurance, I would
> investigate the Uninsured/Underinsured sections of your policy before
> dropping them like he recommends. I decided to keep these because it
> sounded too risky to me.
I must admit having not read any of Givens' books. I find it surprising
that he recommends dropping Uninsured/Underinsured coverage. It is some of
the cheapest insurance available. Some people who dislike the insurance
industry recommend purchasing this coverage. If you are a victim of an
un/underinsured motorist you will likely be stuck with all bills related
to the collision. Many un/underinsured drivers won't be able to pay for
damages (whether to your vehicle or your body). You might be able to find
a lawyer willing to take the person to court but you might not collect even
if there is a judgement in your favor. If you have un/underinsured
coverage, then damages up to the limits of your policy will be covered.
Later,
--Chas DoD #7769 crpr...@ilstu.edu
"Oh, how can you be in two places at once when you're not anywhere at all?"
- Firesign Theatre
JamesC7490
Tong) writes:
You can make a lot of money by never under estimating the ignorance of the
general population. PT Barnum was right on the money. I'm thinking of
setting up a 900 dial a financial physic. Hey, why not, a fool doesn't
deserve to keep his money.
Gibbons Burke
: In article <2qpv9k$9...@falcon.ccs.uwo.ca>, st...@irus.rri.uwo.ca (Shidong
Actually P.T. Barnum is attributed with saying "There's a sucker born
every minute." It was H.L. Mencken who said:
"No one in this world, so far as I know... has ever lost money by
underestimating the intelligence of the great masses of the plain people."
[Chicago Tribune, "Notes on journalism", September 19, 1926] per Bartlett's
Gibbons Burke
gibb...@netcom.com
A man may be a fool and not know it, but not if he is married.
H.L. Mencken