Thursday, April 9, 2015

April 9, 2015, Bob Brinker "2014 Bond Timer of the Year" According to Timer Digest

April 9, 2015....Beware! There are lots of sharks out there waiting to "shark" your wallet. They swim as phony rating services or phony fan clubs or fabricated Brinker Groups

If I told you that I had declared Bob Brinker Bond Timer of the Year for 2014, it's likely that you would think I had been drinking the cooking sherry -- and rightfully so! But that's what Timer Digest has done in spite of Brinker's sad-sack performance last year. 

ETF1-Robert, one of the crack blog research team, sent an email to let me know that Kirk Lindstrom has done an article about Timer Digest naming Bob Brinker and James Stack  2014 "top bond timers."
Kirk said: "Congratulations to Bob Brinker!!!  2014 Bond Timer of the Year! On January 2, 2015 the venerable Timer Digest named James Stack and Bob Brinker as "Bond Timers of the Year." They were bullish all year and matched the T-Bond index.
I have no idea what method  Timer Digest  used to conclude that Brinker's Marketimer bond holdings "matched the T-Bond index."  Let's take a look at what Brinker did last year besides stay fully invested -- as he has been since March 2003.

Firstly, Brinker's Marketimer only has a fixed income portfolio that consists of four bond funds, and  a balanced fund that is approximately 50% invested in three of the same bond funds -- that's it! There are no other bonds in his portfolios. (NOTE: Brinker's income fund is off-the books of his performance record.)   Jim, a member of the blog crack-research team, did an analysis and  reported that the income fund performance for 2014 was 1.1% and the balanced model portfolio III only made 6%.

It's important to know that in 2013, Brinker moved into all low-duration, high-credit risk funds. Jim researched how much these moves cost Brinker's followers in missed profits. Please carefully read Jim's numbers:

Jim said...
I've taken a look at Bob Brinker's final performance numbers for his fixed income portfolio. For calendar year 2014 his Income portfolio was +1.10%. If he had not made any changes from his prior holdings he would have been +6.11%. Here is the breakdown: DLTNX +6.47 vs. DLSNX +1.35, DODIX +5.48% vs. OSTIX +1.26%, MWTRX +5.83% vs. MWLDX +1.39%, and finally VFIIX +6.65% vs. FFRHX +0.41%. All this was calculated using the numbers from M*.

Using the numbers from Yahoo Finance I've come up with the performance from the point he made his changes. They are as follows: DLTNX +7.66% vs. DLSNX +2.02%, DODIX +6.99% vs. OSTIX 1.79%, MWTRX +6.54% vs. MWLDX +2.09%, and finally VFIIX +8.2% vs. FFRHX +2.23%. Overall that computes to an average of 7.35% vs. 2.23%.

Using either time frame Brinker's funds that he sold outperformed the funds he bought by 5+%. It's going to be difficult for his followers to ever make up the 5+% of additional gains that they missed by following his bond timing advice.

January 2, 2015 at 9:44 AM
Brinker made some bond fund changes, backing off of the low-duration in January 2015. Here are some excerpts from my January 18th summary of Moneytalk:
BRINKER'S JANUARY 2015 MARKETIMER BOND FUND CHANGES.... Caller Jackie in Las Vegas (39 minutes into the second hour) asked about the Fidelity Floating  Rate High Income (FFRHX) and the Metrowest Unconstrained Bond Fund (MWCRX).

Brinker replied:   "We don't own the Floating Rate Fund anymore, so it's out of the portfolio.…  The Floating Rate Fund that we sold was a different fund and it was a different fund company also.  As far as the Unconstrained is concerned, there are many unconstrained funds out there.  If you're not comfortable, you should not make the change.…  I do believe that those who are investing in unconstrained, I think it has a place in the portfolio at this point.  That doesn't mean you have to do it.…  Because what you're talking about with unconstrained funds – and there are many of them out there – what you are talking about is a fun that is going to invest in a highly diversified portfolio.  They are going to use varying maturities.  They are going to be unconstrained by managing against an index.  They are not going to be held to investing against an index.  The duration of the portfolio can vary substantially with the management opinion at the time… And all of those things come into play." 

Brinker continued: "Unconstrained also in the sense than you are giving the portfolio manager considerable leeway in terms of how he or she wishes to invest the portfolio.  That's really what it means… Now again, anytime you are uncomfortable with any type of fund, you shouldn't be in it – period.  From my point of view, and anybody obviously that subscribing to the newsletter is interested in my point of view, I'm sharing with them my opinion that within the context of a diversified income only portfolio – because that fund only appears in the income portfolio (3 unintelligible  words).  And I'm saying that within the context of that type of portfolio, I think there's room for a plum like that at this point.

Honey EC: As Brinker said, he sold all Fidelity Floating High Income Fund from his Marketimer off-the-books income portfolio (BrinkerJr sold it last month) and also from Marketimer model portfolio III -- as of January 9, 2015.  He replaced it with DoubleLine Total Return Bond Fund (DLTNX)  which he had sold in 2013. He also sold MetroWest Low Duration (MWLDX) in model portfolio III and replaced it with MetroWest Unconstained (MWCRX). Notice that he did a bit of a sales pitch on the Unconstrained Fund.
My conclusion is that Timer Digest's "timer of the year awards" are not to be trusted, much like Hulbert's silly "Honor Roll" awards.  They are similar to so many other shark attacks from phony Brinker groups and fan clubs, it's all about selling newsletters by any means possible -- in my opinion.

46 comments:

MikeE said...

I thought Kirk Lindstrom could be trusted. Am I wrong?
MikeE

Robert said...

That is funny! Kirk Lindstrom is congratulating Bob Brinker on being Bond Timer of the Year in 2014.

Bob Brinker totally blew it with his obsession about duration and ill-timed move to floating rate junk note.

Also, Kirk congragulated himself for being Bond Timer of the Year in 2013 (along with 5 other guys) yet Kirk Lindstom has been OUT of the bond market for at least the past 5 YEARS! Really blew that one!

IMO Timers Digest is far worse than Hulbert.

What a joke.

gabe said...

It would seem that if an investor wanted to be relatively secure in his bond allocation, he should invest ion the Total Bond Market Fund.

Gabe

CMB said...

Well that's interesting.

I did a little poking around after looking at the Lindstrom story, which points to the "CSI T-bond Index" level achieved by Brinker dating back to 1988 (119.64):

Evidently the CSI T-Bond Index was launched in 2008 as a benchmark by something called the China Securities Index Co. Ltd. for use primarily by individuals and companies trading US securities in the Chinese bond market.

http://english.sse.com.cn/aboutsse/news/a/20130115/a53fe2e441a83437250759947af7e14a.pdf

http://www.mondovisione.com/media-and-resources/news/csi-bond-index-series-taking-shape-as-csi-sector-bond-indices-launched-on-dec-28/

So I guess Bob Brinker is Chinese Bond Market Timer of the Year for 2014, or something. Who knew?!

If this makes any sense to anyone, please explain it to me! If the fund's base year (100) is 2002 what possible legitimacy is there to backdating Bob Brinker's performance to 1988?

The Lindstrom link is here:

http://forbestadvice.com/FanClubs/BobBrinker/Moneytalk/2015/0121_2015-Bob-Brinker-Timer-Digest-Bond-Timer-of-the-Year.html

jm

Honeybee said...

MikeE....Please be specific. Trusted about what?

Kirk probably didn't lie when he congratulated Bob Brinker for his bond-timing. He wants to give credibility to Timer Digest because he (Kirk) has been named a top timer, too.

And he promotes his own newsletter by claiming to be a Bob Brinker fan. Now he claims he is getting information from some anonymous "Brinker Group" who is "emailing him."

He posts information as though it came out of Marketimer. It didn't. And Kirk claims he doesn't listen to Moneytalk.

Honeybee said...

So what would a newsletter seller, that wanted to promote his newsletters with Bob Brinker's name, do if he wanted to spend Sunday afternoons wind-surfing instead of listening to Moneytalk, and didn't want to pay for a subscription to Marketimer?

ETF1 Robert originally posted this here

ETF1 Robert copied it to my Silicon Investor thread.

Kirk Lindstrom copied and used it on his own website, and quite subtly (well disguised) gave credit to ETF at SI and no credit to this blog.

Honeybee said...

NOTE TO READERS...The funds in Brinker's income portfolio has changed since September. I wrote about it in this article.

Jim said...

Bob Brinker Bond Timer of the Year? Sounds much like a late April Fool's joke. Does he mean THE Bob Brinker, or does he mean Junior's Fixed Income Advisor? Either way it's hard to believe. Junior's bond fund advice was similar to Bob Sr. I think. The only way I see they could beat the rest would be if the rest either moved their fixed-income money to CD's or actually shorted the bond market.

Honeybee said...

Jim...It's definitely THE Bob Brinker. Kirk posted a picture from Timer Digest HERE

Honeybee said...

Jim...You mentioned that Brinker Jr's newsletter funds were similar to The Brinker's Marketimer bond funds.

Some similarity, and for awhile, they were exactly the same.

However, Jr did not sell all of Fidelity Floating Rate, except in his "conservative portfolio."

Otherwise, all 3 of Jr's portfolios hold identical bond funds. The only difference is percentage of holdings.

Robert said...

"Evidently the CSI T-Bond Index was launched in 2008 as a benchmark by something called the China Securities Index Co. Ltd. for use primarily by individuals and companies trading US securities in the Chinese bond market"

I don't think that's correct. I think CSI stands for Commodity Systems Inc and a perpetual T Bond contract. It has nothing at all to do with China.

"...A Comprehensive Guide to Trading Methods and Applications John J. Murphy ... method used by Commodity Systems, Inc. (See Perpetual Contract in Chapter 8.) ... Let's say a trader wants a Continuous Contract of T-Bonds using the 2 nearest ..."

Honeybee said...

So does ANYONE know why Timer Digest or Kirk Lindstrom would consider the "T-bond Index" a benchmark for The Bob Brinker's bond fund holdings?

He doesn't have any T-bonds in Marketimer.

Am I hopelessly confused?

Is that the plan? :)

CMB said...

Robert said:

"I don't think that's correct. I think CSI stands for Commodity Systems Inc and a perpetual T Bond contract. It has nothing at all to do with China."

I had seen that company too. After thinking about it I think you are probably right. The similarity of names appears to be just a coincidence.

It's intentionally opaque that a proprietary index would be used to score performance so that we can't check it without paying for the information, though, on top of paying for the Brinkers' newsletters. Or is that standard practice in the professional Timer community?

jm

ego said...

I think a T-Bond index is just some measurment of the broad bond market. Like the DJIA, or the S&P.

You might compare your portfolio to those averages even though you hold none of the stocks in those averages.

At least it's a common measuring stick for all.

Honeybee said...

Ego...well, if Timer Digest claims that Marketimer income portfolio beat the Treasury Bond rate last year, they are wrong. That portfolio returned a whopping 1.1% in 2014.

Jim said...

ego said:
"I think a T-Bond index is just some measurment of the broad bond market. Like the DJIA, or the S&P."
I always thought the Total Bond Market was a good measuring stick, much like the Total Stock Market. Last year the Total Bond Market returned +5.89% trouncing Brinker's Income Portfolio. Don't know why Timer Digest chooses such an obscure benchmark.

Jerrod Clarkson said...

Would someone be kind enough to explain who Kirk is and his credentials? For instance is he a Registered Investment Advisor (RIA), his education etc.?

I have never heard of him, but then I frequently come across new (new to me) people in the financial community.

One thing that I do find a bit unsettling (via the link provided by jm) is Kirk's multi-fonted, multi-bolded, multi-colored layout in his presentation. I feel like at any moment someone will be shouting at me "BUT WAIT - THERE'S MOOORE!!!".

But then, perhaps that is just me.

Jerrod Clarkson

Honeybee said...

Jerrod...Kirk basically writes on the internet and sells newsletters. But rather than try to explain more, Kirk says the following about himself on one of his numerous websites and blogs:

Kirk Lindstrom has written about and helped individuals learn to manage their investments since the early 1990's. Kirk has an engineering degree from the University of California, Berkeley.

Starting as a summer intern in 1978, Kirk worked for 20 as a scientist and engineer at Hewlett Packard's research and development department (R&D) designing solid state devices and components for optical communication. While he was at HP, Kirk invested ten to twenty percent per year of his salary. He made some mistakes early on (starting with paying high fees for "expert" advice that under performed) but soon he learned to invest his own money well enough to afford a life of "semi-retirement" to work for himself. In a way, Kirk became his own "angel investor" using his investment success to invest in a new career on the internet helping others.

An added benefit of working for himself, funded in most part by his own investments, Kirk had far more time to windsurf in the afternoons rather than attend engineering meetings.

After nine years of success as an investor and investment writer, Kirk was featured (pdf) on the front page of the Los Altos Town Crier business section, (online version.)

For over a decade, Kirk edited Investment.suite101.com , one of the first investment web sites designed to have articles and answer questions to help others. There Kirk made many new friends who still subscribe to his newsletters and communicate with him regularly on his "Investing for the Long Term" group on facebook.

Kirk took-off on his own in 2007 to create many of his own profitable websites and write for a few others including:


READ MORE: KIRKLINDSTROM.COM

gabe said...

In the last 10 years, my portfolio has earned 5.4%. pre-tax. I'm no guru.

Gabe

Randy said...

"...Would someone be kind enough to explain who Kirk is and his credentials? For instance is he a Registered Investment Advisor (RIA), his education etc.?..."

Jerrod, Kirk Lindstrom is an engineer by training.

He has no formal training in business, accounting, law nor investment. He is not a Registered Investment Advisor and in fact, holds no academic credentials nor licenses.

No training, education, experience nor even a license is required to write an investment newsletter.

Anybody is free to whip out an investment newsletter on their computer tomorrow ....totally unregulated enterprise.

CMB said...

No, it's not just you Jerrod. Lindstrom's website screams Run Away! to me. I only go there when I have to, which isn't often.

jm

tfb said...

Randy said...
"...Would someone be kind enough to explain who Kirk is and his credentials? For instance is he a Registered Investment Advisor (RIA), his education etc.?..."

Jerrod, Kirk Lindstrom is an engineer by training.

He has no formal training in business, accounting, law nor investment. He is not a Registered Investment Advisor and in fact, holds no academic credentials nor licenses.

No training, education, experience nor even a license is required to write an investment newsletter.

Anybody is free to whip out an investment newsletter on their computer tomorrow ....totally unregulated enterprise.


Are you talking about Kirk or Brinker Jr, aka Binky? Same background more or less, only Kirk actually did have a real job in the field he got a degree in and was successfully employed, unlike Binky.

Yep folks, Brinker Jr has no professional training as an advisor, he is just another confidence man like his daddy.

Jerrod Clarkson said...

Thanks to all for your replies to my questions.

I think I now have the information that I need to formulate a mental picture.

Additionally, after perusing Kirk's mini-autobiography, it is quite clear that he favors illeism in his prose. Hmm.

Jerrod Clarkson

ETF1 Robert said...

"2014 Bond Timer of the Year!
On January 2, 2015 the venerable Timer Digest named James Stack and Bob Brinker as "Bond Timers of the Year."

"They were bullish all year and matched the T-Bond index."
++++++++++++++++++++++++++++++++
Hmmmm...."They were bullish all year" (on the bond market)

How many people listening to Moneytalk and reading Marketimer throughout 2014 would agree that Bob Brinker was bullish on the bond market all year?

All of 2014, Bob Brinker instilled fear of the bond market in his listeners and subscribers.......

Even 5 days ago, a Moneytalk caller somewhat fearfully asked Bob Brinker if he thought the bond market would have big losses.......

Timer Digest has to be nuts to say that Bob Brinker was bullish on the bond market all year.

Bond market bulls don't have a duration of approximately 1.0 year because they are so afraid that rates will go up and tank the bond market.....with substantial losses to NAV.....

That is a very bearish stance on the bond market.......

Timer Digest was drinking a bit too much that night......


Honeybee said...

ETF Robert.... EXACTLY. We all know that Brinker has been cautioning listeners to keep bond duration super short out of fear of loss of principal when interest rates normalize.

There is no way that he would ever have recommended Ten-year T-bonds in 2014.

So for Timers Digest to use it as benchmark to award him " Top timer" is comical at best.

Honeybee said...

Thanks Jerrod....I learned a new word today .....

CMB said...

Jerrod said:

"Additionally, after perusing Kirk's mini-autobiography, it is quite clear that he favors illeism in his prose. Hmm."

Your humble student of the market appreciates your erudition.

jm

otto said...

How can Kirk Lindstrom be named Bond Timer of The Year in 2013 when he's been out of the bond market for at least the past FIVE YEARS...including 2013?

Back in 2010 Kirk said he might have been a "bit early". lol...ya think?


From: Kirk ©

... With my own money, I'm completely out of bonds not indexed to inflation (ie iBonds and TIPS) with thhe rest of my fixed income in savings accounts and money funds. I read an article yesterday by Allan Greenspan highlighting how the 10-yr treasury went up 4% in a span of six months. If that happens again, the small investor pouring cash into bond funds will get crushed again...

...I've been out of bonds other than TIPS for awhile so I may have been a bit early but better early than too late and praying for a bounce to sell into...

June, 2010


http://www.siliconinvestor.com/readmsg.aspx?msgid=29858173

Jeffchristie said...


It sounds to me that Kirk Lindstrom's training and background are similar to those of Bob Brinker Jr. Kirk's degree and work experience is in engineering and he has no college training in finance. Jr. studied computer science in college and worked in that field for years. Now they both write newsletters that are covered at timers digest.

Honeybee said...

Otto...That quote from Kirk would have more validity if your link went to the original post instead of a copy of it that does not contain a link to the original post.

That said, I do believe that it is a correct quote from Kirk Lindstrom.

However, until you provide a direct link to Kirk's original post, it is ONLY opinion that he wrote that.

Honeybee said...

JM...Another trip to Dictionary.com. LOL!

tfb said...

Jerrod writes:

illeism

My comment:

Went to the dictionary yet again. :)

frankj said...

Me too, dictionary.

Word of the Day.

Honeybee said...

"ricardo"...You are not going to personal insults and attacks on Kirk or anyone, posted here. Try again...and still to his professional capabilities.

otto said...

Actually, that post about Kirk's being out of the bond market for the past five years appeared on your blog and you checked it out here....


Honeybee said...

Okay nogo...I just checked the November issue of Retirement Advisor -- Kirk Lindstrom and David Korn, editors and publishers.

The only bond fund in his model portfolios is VIPSX (TIPS), as Kirk said on Silicon Investor.

So I assume you think that was a blunder? Didn't stock funds do better than bond funds last year?

December 30, 2014 at 1:54 PM

http://honeysbobbrinkerbeehivebuzz3.blogspot.com/2014/12/december-28-2014-bob-brinkers-moneytalk.html

Honeybee said...

Otto...Thank you for clarifying all of that for us. I had forgotten that "someone" had already sent that information about Kirk Lindstrom's bond holdings -- and I had looked in his Retirement Advisor to be sure it was correct.



tfb said...

It was written:

Jr. studied computer science in college and worked in that field for years.

My comment:

Interesting. I am not going to say you are wrong but I was under the impression he had very, very little actual industry experience.

My very vague recollection is he ran daddys' website while in college and then after, which was a fairly lightweight undertaking even back then.

But I am open to being corrected.

gabe said...

My guess is that The Total Bond Market at Vanguard diid as well as most of these "exotic" bond funds when you take into consideration cost and fees. I am looking at the 10 year total return.

My two cents.

Gabe

ETF1 Robert said...

frankj said...
Me too, dictionary.

Word of the Day.
++++++++++++++++++++++++

Me too.
Definitely not in my vocabulary.

Illeism /ˈɪli.ɪzəm/ (from Latin ille meaning "he") is the act of referring to oneself in the third person instead of first person.

Jerrod Clarkson said...

Re: Reporting Season

Q1 Earnings Growth or Decline?

For Q1 2015, YOY earnings for the S&P 500 are currently forecast to decline by -4.8%.

If the S&P 500 actually reports a YOY decline for the quarter, it will be the first declining occurrence since Q3 2012 (when a decline of -1.0% was reported).

Jerrod Clarkson

Anonymous said...

Don't trust Lindstrom. How did I find Kirk?
He tricked me into his website with a deceptive "bob brinker fan club" website.
Is he a scammer? I think so.

The Gardner.

JayCeezy said...

Steve said...I'm suprised Bob was live Sunday, given that it is the weekend after the newsletter was published. Easter 2013 he was a rerun; in fact that was the first rerun program that I ever heard be played. April 8, 2015 at 5:46 PM

Actually, Lynn Jimenez guest-hosted Easter Sunday in 2012 as well. Next May 2, 2015 Sunday is Kentucky Derby, and Bob will take the last hour off to enjoy the event (as well as NBA playoffs and Mayweather-Pacquio championship). So, everybody relax...Bob is seated in the captain's chair today.

Jim said...

JayCeezy said:
Next May 2, 2015 Sunday is Kentucky Derby, and Bob will take the last hour off to enjoy the event (as well as NBA playoffs and Mayweather-Pacquio championship).


All those events are SATURDAY May 2 2015. That weekend Moneytalk would be Sunday May 3.

JayCeezy said...

Thank you, Jim, I stand corrected by both you and myself, when I wrote...JayCeezy said...

Bob Brinker gets 12 weekends off per year (and he has the odd one-hour off for Super Bowl and Kentucky Derby, which would be February 1 and May 3 for 2015). It's in his contract, not mysterious at all.

If past performance is any indication of future results, Bob Brinker ALWAYS hosts the last two (holiday) weekends of the year, then takes off the first two weekends in January and the weekend after the Super Bowl. Bold prediction, I know, but if I'm wrong you can tell me that I really don't know what I'm talking about when it comes to radio. But if I'm right...you BETTER BELIEVE I will be gloating about it.:-)

December 27, 2014 at 4:56 PM

Don from Castro Valley said...

I want to thank Jim for his excellent analysis of Bob Brinker's fixed income portfolio; I agree that is horrible performance!!
I would like to add that my only bond fund is Fidelity Capital & Income (FAGIX) which according to Morningstar has the following returns:
2012 16.40%
2013 9.71%
2014 6.13%
YTD 4.01%

I have been in this fund since 2009 and have a 128% gain in that period from 2009

I am not a recipient of the Timer Digest Fixed Income award!! LOL!!

And I do not charge $185 for a newsletter subscription.

Overall Bob has provided very poor fixed income advice for a number of years; best advice I got from him was buying I Bonds in the late 1990s with a fixed base rate in excess of 3% which I still hold and have a return of 107.5% to date.

I only listen to Bob today for entertainment value!! :)

Honeybee said...

Hi Don from Castro Valley,

I copied your great post into the latest comments section (in Sunday's summary) so they for sure won't be missed.

HERE