Don't Lose Money

Warren Buffet's rules for investing:

(1) Never lose money

(2) Never forget rule #1

Why? Because a percentage loss hurts more than a percentage gain helps:

A 10% loss requites an 11% gain to get back to the starting point

A 50% loss requires a 100% gain (From 2007 to 2009 there was a 53% loss-when will it happen again?)

A 90% loss requires a 900% gain

Shouldn't you have a portion of your portfolio assets in investments that can't lose money, yet will still earn a decent rate of return? 

The normal portfolio has 60% of their assets in stocks and 40% in bonds and other fixed-income assets. The 40% is for protection from a major decline in the market. The problem is for a number of years the yield on fixed-income assets has been extremely low due to low interest rates. If interest rates rise in the future which is likely to combat rising inflation rates, the value of bonds will fall, and it will also have a very detrimental effect on the stock market, probably causing a major decline. We provide a solution to each of these scenarios.

 

Is your fixed-income portfolio providing the protection you desire? Probably not. Very low yield with the very real potential for a loss of value in bonds. 

Our program has historically produced an annual yield which is 2% above a bond portfolio, without the risk from rising interest rates. Although we don't know what the future may hold, we can say that over the past 25 years our yield has averaged 8.5% per year, but with the additional benefit of having a 0% floor so you can't lose money. (With the exception of some minor fees and expenses)

 

We also provide protection from a death or chronic, critical or terminal illness.

If you're looking for protection, shouldn't you consider our program for some of your fixed-income assets?