Why a  CAMS-Managed Account Works

An account managed by CAMS is likely to work well because CAMS is free to choose nearly any trading vehicle.  Specific stocks, stock options, ETFs, futures contracts and currency contracts offer a WIDE array of market exposure and more importantly, CAMS can pick from those securities that are moving.  To make money, something has to move.  CAMS strives to be on the right side of that movement and can change every day or several times a day if deemed to be the profitable thing to do.  That's what active management is all about.

Examples of what has NOT worked

The Fidelity Magellan Fund:  This noteworthy stalwart of the “no-load” industry has woefully under-performed the S&P 500 for over a decade, yet it charges its shareholders 73 basis points for the privilege of the possibility of beating the market, which it consistently fails to accomplish.  Or better yet, consider the esteemed member of the American Funds family known as The Washington Mutual Fund, which is so admired by wirehouse brokers, charges an up-front commission and holds nearly $40 billion in assets.  The fund, by its prospectus, dines only on stocks in the S&P 500 that are dividend payers and yet somehow delivered less return than the S&P over the last ten years. 

Unfortunately, the graveyard of failed expectations is filled with the likes of John Ballen, former manager of the high flying MFS Emerging Growth Fund, Gary Pilgrim of the PBHG Growth Fund, and more recently Bill Miller of the Legg Mason Value Trust, the gang at Dodge and Cox, and others.

Why haven't they worked?

By prospectus,  mutual funds are "locked in" to specific, narrowly-defined market sectors, none of which are going to do well all of the time.  Unfortunately, there are large blocks of the population which love these forms of losing money because they buy into the concepts and they get to make their own fund choices.  So in order to attract the largest asset base possible, fund families keep coming out with newer and newer slices of the market pie, most of which will appeal to the crowd.  But the markets create a vast, changing performance landscape because people, businesses, economies and politics are fluid entities.  No single concept can work for years on end, and some can't even do it for a few months. 

If you insist on using funds to build your fortune, you will first of all get the average performance of all of the stocks they contain.  You cannot "target" the hot action in the market with mutual funds.  The two are "mutually" exclusive.   Secondly, and more importantly, we will never see an 18-year bull market again like the 1982-2000 period.  So you have to be a trader, not a buy and hold investor or you will get hammered again and again as markets change and leave you behind.
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Text Box: An account managed by CAMS is likely to work well because CAMS is free to choose nearly any trading vehicle.  Specific stocks, stock options, ETFs, futures contracts and currency contracts offer a WIDE array of market exposure and more importantly, CAMS can pick from those securities that are moving.  To make money, something has to move.  CAMS strives to be on the right side of that movement and can change every day or several times a day if deemed to be the profitable thing to do.  That's what active management is all about. Examples of what has NOT worked The Fidelity Magellan Fund:  This noteworthy stalwart of the “no-load” industry has woefully under-performed the S&P 500 for over a decade, yet it charges its shareholders 73 basis points for the privilege of the possibility of beating the market, which it consistently fails to accomplish.  Or better yet, consider the esteemed member of the American Funds family known as The Washington Mutual Fund, which is so admired by wirehouse brokers, charges an up-front commission and holds nearly $40 billion in assets.  The fund, by its prospectus, dines only on stocks in the S&P 500 that are dividend payers and yet somehow delivered less return than the S&P over the last ten years.  Unfortunately, the graveyard of failed expectations is filled with the likes of John Ballen, former manager of the high flying MFS Emerging Growth Fund, Gary Pilgrim of the PBHG Growth Fund, and more recently Bill Miller of the Legg Mason Value Trust, the gang at Dodge and Cox, and others. Why haven't they worked? By prospectus,  mutual funds are "locked in" to specific, narrowly-defined market sectors, none of which are going to do well all of the time.  Unfortunately, there are large blocks of the population which love these forms of losing money because they buy into the concepts and they get to make their own fund choices.  So in order to attract the largest asset base possible, fund families keep coming out with newer and newer slices of the market pie, most of which will appeal to the crowd.  But the markets create a vast, changing performance landscape because people, businesses, economies and politics are fluid entities.  No single concept can work for years on end, and some can't even do it for a few months.  If you insist on using funds to build your fortune, you will first of all get the average performance of all of the stocks they contain.  You cannot "target" the hot action in the market with mutual funds.  The two are "mutually" exclusive.   Secondly, and more importantly, we will never see an 18-year bull market again like the 1982-2000 period.  So you have to be a trader, not a buy and hold investor or you will get hammered again and again as markets change and leave you behind. l

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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