Today, August 21, 2008 was another one of those confusing days in the market.  The Dow, S&P 500 and Nasdaq opened much lower and it appeared, investors have lost a lot of interests.  Everyone seemed to be fixated on the media circus surrounding Freddie Mac and Fannie May.  The jagged trading pattern suggest short-term trades going in and out.  

Fortunately for the investors in our management, profits have been made this month that compelled us to maintain our cash positions.  For August, our investors have enjoyed a +4.386% return on their money.  The month prior, +10.292%.  

Even the market year-to-date can’t touch our August returns alone.  Why?  Look at the facts, S&P 500 -13.734%, Nasdaq-100 -8.454%, Dow -14.446%.  It’s no wonder, money is flowing out of traditional buy-and-hope institutions to pursue proactive managers like Custodio Asset Management.  And for good reason, in 2007 we have returned a hefty +50.806% to our investors net of fees!  

If your investments are sagging, ask your managers what they are doing to protect your money?  If they tell you, everyone is experiencing the same pain, ask them how they are able to know everything.  It’s obvious that your manager is looking to grow THEIR assets under management, but what are they doing to grow YOUR assets?  Where were they PRIOR to this economic downturn? 

If your manager is lost for words, it is more than likely that they don’t really have a plan to protect your assets from serious decline.  How do I know?  Take a look at your portfolio, why is your money split up in so many different funds?  Since when was it okay to “diversify” so that you can LOSE less than everyone else?  It’s all sales tactics.  They got you in the door because they had a glossy presentation.  Maybe they were a friend or an associate from some previous affiliation.  Maybe they’re even a family member and you, being a kind and generous person, decided to help them out.  

Whatever the reason, the bottom line is, we have a hedge fund strategy, without the barrier to entry.  We can make money whether the market is up or down.  Our mission is to protect your assets from the vultures at Merrill Lynch, Smith Barney, and the like.  Their mission, to bring in assets under management. If the market is down, the salesmen (and women) from these firms will be beating on your door looking for your deposit.  Why?  Because their personal income is suffering.  They don’t care about you, they care about themselves, ask anyone in this camp and if they give you an honest answer, they will tell you this!

So, if your money is not OUT of these firms yet, it’s never too late!  Unless, it has been seriously devalued…then I wish you more healthy years of earned income to recover.