Thursday, June 21, 2012

"Fake Astrology-Based Hedge Fund Threatens To Ruin Things For All The Legit Astrology-Based Hedge Funds Out There "

Don't be laughin'.
J.P. Morgan used an astrologer.
In 2008 the #1 market timing letter was Arch Crawford's "Perspectives".
More links below.
"The fault, dear Brutus, is not in our stars,
But in ourselves, that we are underlings."
Julius Caesar (I, ii, 140-141)
From DealBreaker:

One piece of financial advice that is well known among the cognoscenti but less obvious to some folks in Florida is that you can do 90% of your investment due diligence just by looking at a fund’s name. The tricky thing is that the scale sort of wraps around, like so:

(1) Name that specifies how safe it is (“Global Securities Safety-First Principal Protection Ultra-Conservative Fund”) = probably a Ponzi scheme;

(2) Mythological figure, geological feature, wealthy neighborhood, etc. = you’re good, past performance should predict future returns;

(3) Word from Tolkien = dealer’s choice;

(4) Name that specifies how unsafe it is (“Death Star,” “Terrible Ideas Investment Management”) = probably not a great sign but maybe?

White Elephant Trading Co. LLC Conservative Fixed Income Fund” is the first case I have ever seen of flunking at both ends – it is both “an object, scheme, business venture, facility, etc., considered to be without use or value” and a Conservative Fixed Income Fund. It was also the dream of one Gurudeo “Buddy” Persaud, who promised* investors high and stable returns with one teeny little catch:
32. However, Persaud did not tell investors that in making at least 90% of his trading decisions, he relied on directional market forecasts based on lunar cycles and gravitational pull provided by an internet service.
33. The primary principle underlying Persaud’s trading strategy was that the gravitational pull between the moon and Earth affects mass human behavior, which in turn affects the stock markets. For example, Persaud believed that when the moon is positioned so there is a greater gravitational pull on humans, they feel down and are therefore more inclined to sell securities in the markets.
34. Persaud failed to disclose he would trade investors’ contributions based on lunar cycles and gravitational pull between Earth and the moon.
I don’t know. I didn’t take CFA Level 2 so my gravity-based market-prediction skills aren’t fully honed but this seems reasonable to me? Lots of real hedge funds trade on signals and correlations that sound about as silly as that....MORE
"S.E.C. Charges Psychic With Securities Fraud"
(no, it wasn't Arch)
What the #1 Investment Newsletter is Saying Now
Of Bulls, Bears and Rallies
Investing: "Throwing Out the Rule Book" (The best Performing Investment Letter is by an Astrologer)
How not to do Technical Analysis: A-Power Edition (APWR)
First Solar: Chicken Trader Pulling the Plug (FSLR)
Is The Financial Crisis Making You Psychic?
Psychic News Network: Trading Emissions PLC in Bid for Econergy (TRE.L; ECG.L)

Here at PNN we believe...
Still a few kinks in the system. We have to adjust the crystal ball to spot the potential target, not
the bidder.