The recent news of Mr. Madoff and his $50 billion pyramid scheme has sent a new shock wave through the financial world. Some of you might of known of him or known people invested with him, or perhaps just heard of him. We sincerely hope that no one that you know was involved with this company. In any event, this incident shines a light on why we run our practice the way we do. By having the account in your name you never need to worry about fraudulent misrepresentation of what is happening with your portfolio. Additionally we do not invest client money in anything but tocks (or an occasional ETF) that is publicly traded and therefore able to be valued at the end of every trading day.
Prior to Mr. Madoff exposing himself his clients believed in "to good to be true" results. We have lost a prospect or two to over the years to people who believed in holy grails. Our results weren't going to make these investors rich enough fast enough. In any event we at Fried Asset Mgt have always stayed with our strategy of investing in companies that buyback their stock. Before Lehman Bros. went down and the market fell apart we were down about 10% vs. a 21% decline for the S&P 500. Unfortunately, in the 10 weeks or so that ensued quality stocks like ours were throw out with the all the others. Investors who needed to raise cash often sold the best holdings, as they still had some value, to raise cash. Unfortunately, our portfolios were punished during that time and declined more than the market and more than at any other time in our history as the market was random and irrational for that time period. Fortunately, now that the market has settled down, our portfolios are beginning to outperform the market averages again,
We know the year to come will be challenging. We will continue to do our part in providing the service you have counted on and expect from Fried Asset Mgt. and sticking to our strategy through the ups and downs that are an inevitable part of long term investing.
Our heart goes out to anyone who had wealth they thought was secure disappear over night!
We want to take this time to wish you a Happy Holiday. We know the year to come will be challenging. We will continue to do our part in providing the service you have counted on and expect from Fried Asset Mgt.
Please call if you'd like to talk; we are here for you (310-459-9196). Thank you for your continuing confidence. If you are a former subscriber or client, feel free to call as well. You can be assured that we will continue to ply our craft and we will get through this period and all of us will prosper again.Best Regards, Thanks for your continued support and trust.
David Fried
Fried Asset Management, Inc. *Returns through end 2007, audit available on request. Returns include dividends and interest and are net of fees. Past returns do not guarantee future performance.
