Jim Rogers Investment Advice for Parents

During the 1990s when Jim Rogers was often on TV, Bob Brinker would refer to him as "Mr. Bow Tie" for the fashion statement Rogers continues to make.

In yesterday's article "Jim Rogers reveals his Singapore investment strategy" by Elena Torrijos of Yahoo Finance Singapore, Jim Rogers says parents should:

1. Educate your kids
2. buy a home
3. Have adequate insurance
4. THEN start investing.

When asked what he believed to be the biggest mistakes he has seen people from Singapore making when investing abroad, he replied:

“They don’t know what they’re doing. That’s the biggest mistake when investing anywhere, but especially overseas. Many people wind up investing in Norway when they can’t find Norway on the map.”

Investors, he said, should know currencies, bonds, governments, taxes and the like – everything, in short. “You have to know all that when investing in your own country, but even doubly when it’s a different country,” he said.

Recent Articles:

SPY 1% Below Record High While ECRI's WLI Is Just Below A 6.3-Year High

• The latest all-time high for the S&P 500 put it nearly 26% above its 2007 high. The stock market bears who claimed we were in a "Secular Bear Market that began in March 2000" scared many out of the stock market. Those of us who stayed in the markets and added to positions during the downturns are also well above past highs.

Bob Brinker's Last Buying Opportunity

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Bob Brinker's Last Buying Opportunity

Bob Brinker's last "Buying Opportunity" was issued via a bulletin to his subscribers on September 22, 2011.  It read:

September 22, 2011
S&P 500 Index: 1129.56  

In the September edition of Marketimer we continued to recommend a dollar-cost-average on market weakness approach for subscribers looking to add to their stock market holdings. We also stated that in the event an attractive buying opportunity developed between regular monthly investment letter editions, we would post a Special Subscriber Message on the website for subscriber access.  

In our view, the conditions are now in place to justify an upgrade of our stock market view to "attractive for purchase" for subscribers looking for an opportunity to invest new money into the market at attractive prices.  

Following any additional backing and filling that may occur within the vicinity of the recent correction lows, we anticipate that the market will transition into a renewed uptrend based on our corporate earnings outlook into next year. In our view, the S&P 500 Index has the potential to trade into the low-to-mid 1400s range in 2012. 

That was a good time to buy, of course with the markets near record all-time highs, any time in the past has worked out as a great time to buy, even if you bought at the last tops and reinvested dividends.  

With the markets very near their record highs, I can see why he's worried now, but you have to wonder why he missed 1278 and 1353 in 2012 or even a "gift horse buy" at the start of 2013 before the market gained over 32%.

IF you look at a long-term trend chart of the S&P500 on a log scale, you can make a case to say it is about in the middle of its long-term trading range.  Thus my advice is dollar cost average into an appropriate asset allocation for your age.

I can also see why he has remained fully invested since March 2003.  He knows he doesn't add value with his timing.

My advice is ignore all of Brinker's market timing hocus pocus.  If he could really time the stock market, then he

• would not have missed the greatest bear market since the Great Depression by issuing a "Gift Horse Buying Opportunity" in the mid 1400s as the market began its plunge from the 1500s to 666.  See Bob Brinker's Asset Allocation History
• Would not have told subscribers to invest up to half their cash reserves into the NASDAQ just before it fell by over 80%.  See Effect of QQQ Advice on Reported Model Portfolio Results

Follow his advice to use low cost index funds then rebalance once a year at a minimum as I recommend in my newsletters.

Learn the "Core and Explore" approach to investing
with "Kirk Lindstrom's Investment Letter"

Subscribe NOW and get the May2014 Issue for FREE! !   
(Your 1 year, 12 issue subscription will start with next month's issue.)
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For conservative investors who have no interest in individual stocks, I co-edit "The Retirement Advisor"  where our most aggressive model portfolio is slightly less aggressive then the "core conservative portfolio" in Kirk Lindstrom's Investment Letter."   For more explanation, see  "Kirk's Two Investment Letters - Which is Best for You?"