The bitter end...
The bitter end... What the Pharaoh learned about bonds... Can you use margin to buy bonds?... The best question I received...
Editor's note: Porter and his bond-research team are hosting a free live webinar tonight at 8 p.m. Eastern time. Tune in at 8 p.m. by clicking here.
Still with us? Still reading? You deserve a medal!
Over the last five days, we've published more than 20,000 words about the most boring subject on Earth. It's hard to believe we have any subscribers left...
Let me apologize for torturing you with an unrelenting discussion of corporate bonds. I (Porter) did it because I genuinely believe that a diversified portfolio of corporate bonds offers the best attainable investment performance for most people.
Most people have a hard time making money with stocks. Most people have a hard time losing money in bonds. As a result, most investors would be better off if they only invested in bonds and never bought stocks. That's a hell of a thing for an investment newsletter writer/publisher to say, but it's true on average.
If you've always had trouble making money with your stock portfolio – or if you would simply prefer a safer and less volatile investment strategy, try allocating more capital to corporate bonds.
When you buy bonds...
- You know exactly how much you will make and when you will be paid.
- Your rights are guaranteed by law. The company cannot refuse to pay you your coupons or your principal. If it can't pay you, shareholders get wiped out and the company goes bankrupt.
- You get a binary outcome. Bonds are like a pass/fail test in school. You don't need to know everything about a business to successfully evaluate a bond... you just have to know that it has enough money to pay you.
- It's awfully hard for the management team to screw you. Management can do lots of stupid things, almost all of which are bad for shareholders (sell assets, sell more equity, sell more bonds), but your returns will not decrease.
And then there's the credit cycle...
There are routine cycles in the corporate-bond market. Just like Joseph warned the Pharaoh, credit growth cycles (years of plenty) tend to last between six and eight years. These are periods of strong bond issuance, when it's easy for companies to borrow and refinance their debts.
Just as night follows day, these periods are always followed by periods of rising defaults (famine). These default cycles typically last two to four years and feature sharply higher interest rates and much lower prices for corporate bonds.
Credit has been growing strongly for six years now and has only recently begun to tighten. The default rate suddenly doubled, and credit is getting significantly more expensive for the first time since 2008. It seems likely that we are on the verge of a new default cycle, during which great opportunities will emerge in corporate bonds.
One of the main drivers of these opportunities will be large intuitional investors, like mutual funds, which can be forced to sell because of investor redemptions. Institutions are generally not allowed to buy noninvestment-grade debt, and many are not allowed to even own it. As a result, when investment-grade corporate debt is downgraded, there can be incredible inefficiencies in the market... Everyone is selling, but no one is buying.
Because the amount of credit growth over the last cycle has been so huge, and the general leverage in the financial system is so high, there are sure to be some huge "fireworks" as this cycle progresses. I fully expect to make dozens of unbelievable recommendations in the corporate-bond market over the next 36 months. When I say unbelievable, I mean it. You will not believe the opportunities we will find.
I recall in February 2009, Steve Sjuggerud showed me a PIMCO leveraged bond fund that was trading at half of net asset value. If the fund merely liquidated, we would double our money. It was yielding more than 20% at the time, and I couldn't imagine a scenario where we could lose money. These are the kind of nutty things that happen at the bottom of a credit cycle. I hope you'll join me in putting some capital aside and doing some homework now so that we're ready as the cycle progresses.
Let me remind you about what I believe is the greatest advantage over stocks that bonds offer investors...
It isn't true that as the price of a stock declines, it becomes less risky. Value investors love to sing that song, but it's a lie. Most stocks that dip below $10, for example, never go back above that price. Share prices fall as a company's prospects decline, or as their balance sheet becomes encumbered. Often, the problems get worse as the stock goes lower. Thus, a falling stock price is normally a harbinger of trouble and more risk. If you've ever bought a stock that looked "cheap" and then got a lot cheaper, you know what I mean.
Bonds, however, are binary. The intrinsic value of a bond doesn't change, regardless if the company is doing well or poorly. The security of a bond lies in its underlying collateral, not in the performance of the company. Therefore, a bond that's trading at $25 can be genuinely less risky than a bond trading at say $75. Yes, the $25 bond is more likely to default, but that isn't the same thing as saying it's riskier.
In fact, one of the most striking facts we've discovered about bonds during our research is that noninvestment-grade bonds and investment-grade bonds have had almost exactly the same recovery rates over the last 30 years – around $0.40 on the dollar. While I would not expect recoveries to be that good during the next default cycle, when we recommend bonds we will always evaluate the collateral so that we know what we are actually risking in a worst-case scenario. With stocks, you're always risking 100%.
I believe discounted corporate bonds offer investors an unbeatable combination of high returns and safety. With these bonds, you have the opportunity to make capital gains that are better than the average returns in stocks, while also earning high rates of current yield. Plus, you can make these returns with securities that are far safer than stocks.
There are, of course, huge caveats to this advice.
I've tried to explain most of the pitfalls over the last five days. The biggest and most important caveat is that, unlike stocks, bonds are binary. They will either pay you in full and on time or they won't. That's great because you don't have to worry about whether the company is doing well, you just have to make sure that it can pay you. This creates a different kind of market dynamic where, if doubts about a company's ability to service its bondholders emerge, it can become difficult (or even impossible) to sell.
The only way to deal with this kind of binary do-or-die asset is to diversify your portfolio. If you're not able or willing to diversify your corporate-bond portfolio – that means buying at least 10 different bonds across the risk spectrum – the chances of you losing money are 50/50.
On the other hand, if you diversify and wait until these bonds are trading at a substantial discount to par, there is almost no chance you will lose money if you're able to hold the bonds until maturity.
The other major caveat is that bonds can be difficult to buy and sell. Unlike stocks, there isn't a constant bid and ask in every corporate bond. When you want to buy, you usually have to pay a much higher price than you could get if you wanted to sell.
This "spread" makes trading bonds a bad idea for most individuals. That means when you buy a bond, you have to be prepared to hold it. It also means trading techniques that you might use to manage risk will be much less effective. That's another reason diversification is so important.
I've spent a lot of time and money over the last six months building a huge analytical engine that can analyze all U.S. corporate bonds. Our system is designed to find the "needle in the haystack" – bonds at various levels of risk that we believe are mispriced relative to their chance of default.
I'm confident that with this new tool and my team of analysts, we can outperform the work we did during the last default cycle, when interest rates on these kinds of corporate bonds peaked in the mid-20% range. This is going to be a fantastic time to be a bond investor. And we've built the tools you need to make careful, diligent choices. I wouldn't buy bonds without looking at our work first.
Yesterday, I gave you a small sample of our work. Yes, we will be making specific recommendations – probably one per month. But far more important, we're also going to give you a fair amount of data on the market and individual bonds that our computer models have told us are attractive. This will help you time the default cycle and give you dozens of possible bond investments in addition to our formal recommendations.
Tonight at 8 p.m. Eastern time, I'll be discussing our new product in a live webinar with the analysts who built the analytical engine we're using. Regardless of your interest in subscribing, I encourage you to join the conversation. You will learn a lot more about how to analyze bonds by listening to the details of how we built our computer model.
And of course, I will be answering even more questions about bonds – from the generic "how do I buy them?" to the details of how we judge collateral. The webinar is totally free – there's no obligation whatsoever if you just want to sit and listen. Watch it by clicking here at 8 p.m. Eastern.
But let me say this: I firmly believe our new Stansberry Credit Opportunities advisory will be the most successful and safest advisory we have ever published.
Sure, it's easy for me to say that. But look at the performance of the bonds we recommended during the last crisis... we didn't lose money on any of the distressed bonds we recommended, from Lehman's default through the end of 2010, and one of those bonds made returns in excess of 700%.
This coming default cycle will be worse, and the tools we now have to pick safe bonds are far better and more sophisticated than what we had last time. I have heard from hundreds of you that wished you had paid more attention to our last bond newsletter. Well, this is it. This is opportunity knocking. Don't fumble the ball this time.
Here's the irony: Even if I'm right about the future performance of this product – even if it's the most successful advisory we ever publish – it will also generate more subscriber anger and dissatisfaction than any of our other publications.
Why? Because buying bonds is not like buying stocks. You will probably have to use the phone. Some brokers will not allow you to buy noninvestment-grade bonds. Some brokers will not help you find the bonds you want to buy. That's why I strongly suggest you call your broker and discuss your plans to buy distressed bonds during the next 12 to 36 months. Find out if your broker is willing to work with you and, if he isn't, find one who will. It's not that hard.
You can do it. And it could be worth a fortune if you just try. According to many subscribers, Interactive Brokers is easy to work with and is prepared to help you purchase individual bonds. I personally have used Ameritrade to buy deeply distressed debt. It's not impossible to buy corporate bonds. It just might feel that way the first time you try. Persevere.
Here's something you've never seen me do before: There are a lot of reasons you shouldn't subscribe to my new bond letter. I want to make sure you understand why it's probably not right for you...
• Please do not subscribe to our new bond service if you're afraid of using the phone or if you can't be bothered to search for a good bond broker who will work with you. Remember, we cannot recommend a broker. We cannot place your trades. We cannot give you any personal advice whatsoever.
• Do not subscribe if you can't manage dealing with a nine-digit CUSIP symbol that's made up of both numbers and letters. (Oh, the horror!) This is how bonds are identified. You will have to use them every time you buy or sell a bond. You will see them every time you get your account statements. And you will see them constantly in our research.
• Do not subscribe if you're not aware that there can be little liquidity in the bond market. When we make a recommendation, our subscribers who buy will cause the availability of those bonds to decrease, at least temporarily. That doesn't mean you will never be able to get the bonds you want, it just means you have to be patient. You might have to consider buying a slightly different bond (from the same issuer). It's no big deal, as our ratings are based on the issuer. But if you can't handle being flexible given the liquidity constraints of this market, do not subscribe to this advisory.
• Do not subscribe if you're only going to buy the riskiest bonds we recommend or if you're not willing to diversify your portfolio. Please, please, please do not do this. It will make me pull out my hair when you send me a note blaming me for your losses.
• Finally, do not subscribe if you're poor. I'm not being rude. I'm serious. Bonds are great for people who are already rich. They're not that great for people who are poor, as most of the returns from bonds come from coupons (yields). To earn good amounts of income, you have to have a lot of capital. That's just a fact, and it's not my fault. When asked about the poor, Ayn Rand said "Don't be one of them." I subscribe to the same theory. Go make money. When you have some, subscribe to our bond research. But please don't badger me about not doing enough to help people: I just wrote more than 20,000 words about bonds, for Pete's sake. And I didn't charge you anything to learn about them.
We have a fantastic mailbag below. I hope you will take the time to read each note carefully. There were a few of the typical bonehead questions I tend to get every time I write about bonds. But far more important, there were a few great questions, too.
First, though, let me admit a fault: I normally read every e-mail you send me each day. In fact, I have your feedback e-mails sent directly to my cell phone so that I can read them as I drive home from work. (Just kidding. It blows my mind that people will actually read text messages and e-mails as they're driving. Nuts.)
That said, I haven't been able to keep up with all of the questions and feedback this week as I've been spending so much time writing this series about bonds. I did see hundreds of kind e-mails last night and I genuinely appreciate your notes – I will read them all by the end of this week. Please understand that I can't reply individually, but I will read your note.
And now, dear subscribers... I will try to answer your questions about corporate bonds. Lord help me.
"I understand that someone should have at least $50,000 but are there funds that one can invest with a lesser amount? Also are these bonds marginable?" – Paid-up subscriber John A.
Porter comment: Ugh. Please tell me this is a joke. You're kidding, right? Sadly, I don't think you are.
I don't know what you mean by "funds." If you're talking about bond mutual funds, there are plenty that you could buy to gain exposure to the corporate-bond market. But as I wrote in some detail, I wouldn't do that.
Regulations require mutual funds to provide seven-day liquidity. However, the underlying assets (corporate bonds) are typically illiquid. A mutual fund trying to sell tens of millions of dollars' worth of noninvestment-grade bonds could take months to get out of a position... or even longer.
The Wall Street Journal has done fantastic research on this huge problem. Read the articles about this topic written by Matt Wirz and Tom McGinty. They found that 10 of the 18 largest bond funds that invest in corporate debt have "significant" holdings of bonds that essentially never trade.
For example, the Dodge & Cox Income Fund, which is one of the largest bond funds in the world, holds nearly $500 million of a Petrobras bond that was recently downgraded from investment-grade to junk. As a result, it would take more than 100 days to sell this position (assuming it could be sold at all). How, pray tell, will these funds deliver on their promise to return investors' capital within seven days if it takes them hundreds of days to sell their bonds? As the former director of the SEC's trading and markets division said, "We have a crisis in the making."
This crisis, by the way, is the opportunity we see approaching.
Just imagine how much fun it's going to be to buy bonds from huge institutions that are being forced to sell them because panicked mutual-fund investors don't understand the bond market.
In regards to margin... Just shoot me. Seriously. Let's get drunk and play with guns until something bad happens. That's what you're saying when you ask about margin.
It's a fair question. I'm not trying to be a jerk. The simple answer is: Yes, most brokerage firms will allow you to use margin on investment-grade bonds. Some will allow you to use margin on junk bonds (though not as much). Interactive Brokers, for example, will allow you to margin up to 30% of a junk bond's value or 50% of an investment-grade bond's value.
Here's why I object to the question. Junk bonds are risky and volatile. As I've told you, it is essentially inevitable that one (or more) of the bonds we recommend will end up in default. I believe we can mitigate this risk by 1) carefully analyzing the potential recovery, 2) making sure the company can afford to pay us interest for at least two years, and 3) making sure we don't pay too much.
Likewise, we can completely mitigate volatility by holding until maturity. Every bond that performs is worth $1,000 at maturity. For the thousandth time, bonds are binary. They either pay exactly what you're owed, on time, or they default. If you know your bond is worth $1,000 in two or three years, what difference does it make if it's trading at $60 one day and $50 the next? As long as you know it can pay you at maturity, the trading price is completely irrelevant, unless you plan to buy more.
But if you're a complete idiot (like me, for trying to teach people about bonds), you can royally screw all of this up by borrowing money to buy bonds. Just ask the dunderheads at Long-Term Capital Management what happens when you're long a portfolio of bonds with borrowed capital. The answer is you're forced to sell at exactly the wrong time to meet your margin commitments.
There's a reasonable argument to be made for using margin on a diversified portfolio of high-quality, investment-grade corporate bonds. Hedge funds do a lot of this. They carefully model the volatility of the bond portfolio and they (hopefully) employ a safe amount of leverage to generate much larger returns. I wouldn't recommend this to individual investors. It's harder than it looks.
Also, as we are in the early stages of what I believe will be a huge default cycle, borrowing money to buy bonds right now is just about the stupidest thing I can imagine doing.
Finally... if you have the opportunity to buy bonds at big discounts (sub-$70, with yields in excess of 10%), do you really need to use margin to generate great returns? No. But that won't stop you. Oh boy. Maybe I should have never written about bonds...
"I was a little confused by the following paragraph in your e-mail:
Another way of reducing risk is to only buy bonds with shorter durations. The default rate plummets as you move the duration of your portfolio into shorter time frames. From 1920 through 2008, the default rate on investment-grade corporate bonds in their first five years of trading was only 3.1% – less than half of the 10-year default rate.
"The first two sentences seem contradictory to the last sentence. Are you saying that there are 5-year bonds and 10-year bonds and that 5-year duration bonds are much safer? Or are you saying that you should buy a 10-year bond AFTER 5 years so there are only 5 years left? Or are you saying that you should buy a 10-year bond in its first 5 years? Could you please clarify? Second, these stats and almost all of your stats that you quote that sound 'so good' are for investment-grade bonds. If you are going to recommend noninvestment-grade bonds in your service, why are you even giving us the stats of investment-grade bonds? Isn't that like quoting stats on the DOW 30 when you're selling penny stocks?" – Paid-up subscriber Brent N.
Porter comment: As bonds age, the risk of default increases. It's not hard to imagine why. Think about when you get a mortgage. Someone has verified your current employment, your income, and the assets you have in the bank. They do so to make sure it's almost impossible for you to default immediately. But five years later, who knows what's going to happen to your job and your assets?
Corporations face the same kinds of changes but on a different scale. If you want to reduce your risk when you buy corporate bonds, look for bonds with short durations. Prime-rate funds, for example, mostly hold 60- and 90-day notes. These only get underwritten if the fund is certain it will be repaid. These loans almost never default because they have such short durations.
In regards to your second question, why did I mention investment-grade bonds? Well, a big part of my job is to try to educate my subscribers. Investors who know something about the markets make much better subscribers. For most investors, sticking with investment-grade bonds is a better alternative to investing in stocks. It's much safer and easier to make money. Plus, it takes almost no effort.
No, we aren't going to be recommending investment-grade bonds (at least, not unless they are trading at a big discount) because there's really no point in trying to analyze them. They are all safe, or else they wouldn't be investment-grade. And because bonds are binary, these bonds' outcomes aren't in question. That's why they all trade around (or even well above) par. Why spend days and nights trying to figure out if a bond that's trading at $97 might actually be worth $100? Just buy 50 of them and go back to sleep.
Noninvestment-grade bonds, on the other hand, are definitely worth studying. Trying to figure out if a bond that's trading at $25 might actually be worth $100 at maturity can be an amazingly lucrative pastime. Just ask anyone who bought that Rite Aid 8.5% convertible bond and earned more than 700% (as you can see in the Hall of Fame at the end of every Digest).
"Could you please expand on the following statement from Monday's Digest? It is difficult for me to understand why I would receive $1,000 back on a bond that I paid only $300 for. It seems too good to be true." – Paid-up subscriber Judy B.
Porter comment: Let me applaud Judy for asking this question, which I am sure many people thought and only she had the courage to ask. Out of all of the questions I received, this one was hands-down my favorite, because it's the most skeptical question I got and it goes right to the heart of the matter. Dear friends, anytime you ever hear anything that sounds too good to be true, make sure you understand what's really happening. Then verify it nine different ways before you test the waters with a small amount of capital to make sure you actually know how it works.
Brilliant question, Judy. You're completely right. It does not sound reasonable that you can buy a bond for only $300 and then force a corporation to buy it back from you at $1,000. But that is, in fact, what happens on rare occasions.
It only happens because the company originally borrowed $1,000 from an investor when it issued that bond. Because bonds are contracts that carry the force of law (at least, when the courts decide to apply the law honestly), you sometimes have the opportunity to buy bonds at a big discount to par from the amount originally borrowed. That's because investors begin to doubt that the bond can be repaid or refinanced.
That's what happens when a default cycle begins. Often, as bonds are downgraded from investment-grade to junk, institutional investors are forced to sell. When that happens, prices on bonds can really plummet. Just imagine if you had to sell something really valuable – like a one-of-a-kind piece of jewelry, or a rare book – in one day or even a week. To get anything close to a fair price, it can take a long time to sell something in an "illiquid" market where there is no steady bid.
The reason we're relaunching our noninvestment-grade bond-research product now is because we see that a new default cycle is beginning and we believe we're going to have the opportunity to buy bonds at big discounts soon. Those opportunities are already appearing in some sectors of the market.
Now, before you buy my research product – and certainly before you buy any corporate bonds – you should ask your financial advisor whether what I've written is completely accurate. And you should understand the risks, as I've tried to explain them in this series about bonds. Whatever you do, don't buy anything you don't understand. Thanks for asking such a great question.
"What range of percentages would you recommend allocating to noninvestment-grade bonds? Looking at the High-Yield Spread chart in your 11/10/15 email, it seems you would do best by buying bonds when you thought the Spread had hit its peak & was dropping, as presumably that is when the bonds would be selling at their biggest discounts. But as all is not as it seems, my guess is that this chart is just an average, with each bond hitting its biggest discount at its own time. Am I looking at this correctly?" – Paid-up subscriber David S.
Porter comment: Your question about allocation is a common one, but it's also impossible for me to answer. Allocation is a deeply personal question that you should carefully discuss with a financial advisor. I can't answer that kind of question for subscribers, as it depends completely on your age, goals, and risk tolerance.
I would tell you that I would NOT count investments in noninvestment-grade bonds as part of my fixed-income allocation.
For example, a lot of financial planners start with a basic allocation of 60% in stocks and 40% in bonds. I wouldn't count junk bonds as being part of my fixed-income allocation. Junk bonds are a kind of higher-yielding, lower-risk alternative to buying stocks. You have the potential for substantial capital gains and you're risking capital (just like you do with stocks).
Yes, the yield-spread chart is based on an index (a broad sample) of bonds. Individual bonds reached peaks in yields at various times between October 2008 and April 2009.
"I'm always skeptical of anyone who gives free financial advice, but I have to say that you guys have generally seemed right on the mark. The case you're making seems pretty compelling, but it does bring up some questions:
1. If intelligent bond investing is so far superior to equity investing, why do you even recommend stocks (you do it most of the time). And don't say it's because people won't listen, or will stop following you. You said you're interested in providing the best financial advice, regardless of its effect on your popularity.
2. As you yourself suggest, we're going into extreme, uncharted territory: unprecedented financial stress on a much larger scale of debt issued under unrealistically low interest rates that can't sustain. Why do you believe that the 30% rule of thumb you mentioned will have any validity in this environment?
3. You seem to be implying that these opportunities are there now even though things are going to get a lot worse. Isn't this a case, just as in stocks, of avoiding the 'falling knife?' As you guys say, don't you have to wait until these bonds are cheap, hated and in an uptrend?
4. I think I understand the danger of investing in bond funds instead of individual bonds, but is this still true if the fund specializes in distressed bonds? Are there no funds to do the legwork and diversification and invest in distressed bonds instead of overpriced ones? I just read about OAK in Barron's. They seem to be preparing to do what you're describing." – Paid up subscriber Gary O.
Porter comment: Gary, my advice is to be skeptical of all investment advice – especially the kind you pay for. Skepticism is the most critical contributing factor to your investment success over the long run. So with that in mind, here are my answers to your questions. Read them skeptically.
1. We recommend stocks because out of all the types of securities, the average returns on stocks are the highest. Of course, that doesn't mean that stocks present us with the best opportunities at all times. However, over time, stocks will produce the highest average returns.
The trouble is, few people seem to be able to equal these average returns in their own accounts because emotions ultimately get in the way. Or as I like to say, many of the people who start out being "buy-and-hold" investors end up becoming "buy-and-fold" investors.
My company offers many strategies to help investors overcome this problem, such as using small position sizes, trailing stop losses, and investing in high-quality businesses. These strategies can help mitigate the volatility and the fear most investors suffer. Likewise, buying corporate bonds can help mitigate your portfolio's volatility.
2. I personally believe the current default cycle will be by far the worst the corporate-bond market has ever seen. The default cycle was cut short by government intervention in 2009. That left a lot of "zombie" debt out there that should have defaulted but didn't. Instead, it was "rolled" forward and refinanced in 2011, 2012, and 2013. These years witnessed a virtual blizzard of "paper" – another word for bonds. Annual issuance of corporate bonds was more than double its previous all-time high for three years in a row.
Likewise, there's a natural correlation between the size and the scope of booms and the bust that follows. We have never seen a bigger boom in corporate bonds than we saw between 2012 and 2014. High-yield bonds traded at such high prices that their yields fell to less than 5%. That's insane, as I've written repeatedly since May 2013.
There will be a reckoning. And it's going to be a doozy. For folks wise and patient, this coming storm will prove to be a windfall – I'm calling it "the largest legal transfer of wealth in history." The key is to raise cash now so that you will have liquidity later when yields reach the kind of highs we saw back in 2008 and 2009.
3. There's nothing wrong with waiting until bonds are in an uptrend, but that won't be as easy as you think. Bonds are different from stocks. There isn't a steady bid or ask. Buying and selling can take weeks or months. I doubt you will be able to time this market. That's why I believe it will be important to invest through the cycle. Different areas of the market will reach peaks in yield at different times. You should aim to invest not just across different market sectors, but also across time. Doing so is the only way to make sure you're investing at the peak in yield, as no one knows how high rates will go.
4. Man, that's a great question. I agree that Oaktree is one of the finest (probably the finest) distressed-debt asset managers. (And pardon my bragging... but I know one of its managing directors attended our most recent conference and is a fan of our work.)
Chairman Howard Marks is a brilliant investor with a long and successful track record of investing across the default cycle. He has raised a huge new fund for institutional investors – something like $20 billion worth of capital. If you're investing with Oaktree in a private distressed-debt fund, I would expect you to do well during this cycle. But I would be cautious about buying its mutual funds. I don't think you'll get the same performance as you will in Marks' private fund, simply because of the liquidity problems the firm will face, as I've described above.
"As former President of a company I wanted to tell Porter how much I appreciate the business you have built. A little about myself, I was in the Special Forces in the late 80's, used the GI bill to get a finance degree from Drake University in the mid 90's, worked in the construction/development business becoming a V.P. for Skanska in New York before becoming a partner and President of development company in Seattle with members of the Nordstrom family.
"At the age of 41 I was diagnosed with ALS. I was able to continue working for a few years until finally retiring in 2013. After spending $1.6 million and seeing 32 doctors from 7 different countries, I have learned I have Lyme Disease.
"In 2013 I was wheelchair bound, had to quit working, spent a depressing amount of money in an effort to stay alive and figure out what was wrong with me. When I quit working I was bored terribly and always having a passion for finance, I started following Porter. All of Porter's writings were very educational and fueled my desire to pursue finance further. Not being able to exercise my body, I decided to exercise my mind. I will receive my Masters Degree in Finance in January and am scheduled to sit for my first CFA exam in June of next year. It was the excellent and educational essays from Stansberry Research that motivated me to do accomplish this. Also Doc, Jeff Clark, and Matt Badiali motivated me to start trading options. With the education these men gave me, I am on a roll to rival Doc's run and making back the money I had to spend on my health.
"On the health front, I am treating the Lyme Disease and am now walking with a walker and getting stronger. It is a very difficult disease to treat and required a lot of research. After the military I always maintained my weight and strength but the last years in a wheelchair caused me to gain 25 pounds, Steve Sjuggerud (apologies for spelling) has motivated to get more disciplined with my diet and I am also down 10 pounds. My intention was not to ramble on but I wanted to give Porter and the team at Stansberry some context as to how sincere my thank you is. The financial analysis is excellent but your company and the people that work there impact our lives much more than you think. So a very sincere thank you to Porter and the entire team at Stansberry." – Paid-up subscriber Geno J.
Porter comment: I'm deeply humbled by this recognition, Geno. Thank you very much. It's a tremendous pleasure to serve subscribers who recognize the value we work so hard to provide.
New 52-week highs (as of 11/10/15): Sinclair Broadcast (SBGI) and Alleghany (Y).
Regards,
Porter Stansberry
Baltimore, Maryland
November 11, 2015
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