Masters Series: Three Qualities to Look for Before You Go into Business with Anyone

Stansberry & Associates Top 10 Open Recommendations
(Top 10 highest-returning open positions across all S&A portfolios)

As of 10/11/2013

 

Stock Symbol Buy Date Total Return Publication Editor
Rite Aid 8.5% Conv. due 5/15/2015 767754BU7 02/06/2009 624.7% True Income Williams
Prestige Brands PBH 05/13/2009 398.1% Extreme Value Ferris
Enterprise EPD 10/15/2008 226.6% The 12% Letter Dyson
Constellation Brands STZ 06/02/2011 187% Extreme Value Ferris
Abbott Labs ABT 05/20/2011 178.5% The 12% Letter Ferris
Altria MO 11/19/2008 169.2% The 12% Letter Dyson
McDonald's MCD 11/28/2006 164.7% The 12% Letter Dyson
ProShares Ultra Health Care RXL 03/17/2011 159.3% True Wealth Sjuggerud
GenMark Diagnostics GNMK 08/04/2011 150.8% Phase 1 Curzio
Hershey HSY 12/06/2007 150.8% S&A Investment Advisory Stansberry

Please note: Securities appearing in the Top 10 are not necessarily recommended buys at current prices. The list reflects the best-performing positions currently in the model portfolio of any S&A publication. The buy date reflects when the editor recommended the investment in the listed publication, and the return shows its performance since that date. To learn if a security is still a recommended buy today, you must be a subscriber to that publication and refer to the most recent portfolio.

Top 10 Totals
1 True Income Williams
2 Extreme Value Ferris
3 The 12% Letter Dyson
1 The 12% Letter Ferris
1 True Wealth Sjuggerud
1 Phase 1 Curzio
1 S&A Investment Advisory Stansberry

Stansberry & Associates Hall of Fame
(Top 10 all-time, highest-returning closed positions across all S&A portfolios)

Investment Sym Holding Period Gain Publication Editor
Seabridge Gold SA 4 years, 73 days 995% Sjug Conf. Sjuggerud
ATAC Resources ATC 313 days 597% Phase 1 Badiali
JDS Uniphase JDSU 1 year, 266 days 592% SIA Stansberry
Silver Wheaton SLW 1 year, 185 days 345% Resource Rpt Badiali
Jinshan Gold Mines JIN 290 days 339% Resource Rpt Badiali
Medis Tech MDTL 4 years, 110 days 333% Diligence Ferris
ID Biomedical IDBE 5 years, 38 days 331% Diligence Lashmet
Northern Dynasty NAK 1 year 343 days 322% Resource Rpt Badiali
Texas Instr. TXN 270 days 301% SIA Stansberry
MS63 Saint-Gaudens   5 years, 242 days 273% True Wealth Sjuggerud

Editor's note: Finding the right partner can make or break just about any new venture, says our friend Mark Ford.

And he should know... Mark – wealth coach and founder of our corporate affiliate The Palm Beach Letter – has launched more successful enterprises than nearly anyone we know. Mark is a self-made millionaire. Over the last 30 years, he has built hundreds of businesses... and amassed a huge personal fortune.

In today's edition of our weekend Masters Series – originally published in the July 19 edition of our free e-letter, DailyWealth – Mark details the three qualities to look for when going into business with someone. His philosophy applies to everything from selecting a business partner to hiring an insurance agent. And it's bound to help you build longer-lasting, more profitable relationships...

Three Qualities to Look for Before You Go into Business with Anyone
By Mark Ford, The Palm Beach Letter

I am not a spendthrift. But I'm not a cheapskate, either.

I know people who are not happy in a deal unless they feel like they've beaten the other guy down to nothing. That approach to business is mean and inefficient. Most times, it will end up backfiring.

Let me tell you why.

You are building a new house. You have asked three contractors for bids. You call in the low bidder and begin the process of chiseling him down on his prices.

He needs the work. (Pretend it is 2010.) So he agrees to build your house for what it costs him. He will be able to keep his workers busy and pay them, but he won't make a nickel of profit on the deal.

You feel great.

But what you don't realize is that in building your house, you will make changes. Dozens of them. And every time you make a change order, he will screw you.

It will be a screwing he believes you deserve. By the time the house is done, he will have his profit and more. And you will have paid a higher price than you should have and made an enemy in the process.

As an investor in residential real estate for 30 years, I've seen this scenario play out at least 100 times.

I've learned from my business and financial relationships that getting the cheapest deal doesn't necessarily mean you're getting the best deal.

Instead, when I go into business with someone, I am looking for three things:

•   The right match (someone who brings me something useful that I need).
•   The right personality (someone I enjoy dealing with).
•   The right deal (a deal that is good and profitable for both of us).

For example, Peter, my main partner in my rental real estate activities, cannot afford to bring cash to the business. But he brings other things.

First, Peter is the right match. He's detail-oriented, which I'm not, so he keeps good books. He's also tighter with expenses than I am, so he won't buy a new refrigerator when he can fix the old one for $25.

He's better than I could be with renovations and repairs because he has 30 years of experience working with trades. He knows what services cost. And he's very good with people – happy to listen and compromise but hardly a pushover.

Second, Peter is also someone I work with well – in other words, the right personality. We've been partners in various projects on and off for 40 years. Working with him is fun and easy. That makes the business fun and easy.

Third, the deal we have is a good one. In return for donating some of his expertise and time, I give him a share of the equity. Plus I pay him an arm's-length management fee.

It's a good deal for him because he gets income and equity in the real estate we buy without putting any cash up. It's a good deal for me because Peter takes care of everything. The only thing I really need to contribute for a rental real estate deal is cash.

The relationship works well for me because he does things I can't or won't do on my own. I trust him implicitly. I'm happy to pay him very well for this, and so our deal is fair for both of us.

I have the same philosophy in selecting brokers, financial advisors, and insurance agents. I want expert advice and great service. And I don't want to overpay for it. But I don't want to underpay, either.

Best,

Mark Ford

 

Editor's note: Mark used these three qualities to select his business partner at The Palm Beach Letter, Tom Dyson. Tom recently told Palm Beach Letter subscribers about a little-known account that was once used by several presidents, including JFK and Franklin D. Roosevelt. In this account, your money grows four to five times faster than in long-term CDs. Plus, it's 100% tax-free. To learn more about Tom's idea, click here.

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