Exceptions to My Investing Rule

by | Mar 11, 2019 | Archives

Here are two exceptions to my investing strategy.

First, what are my rules?

#1: Keep it simple.

#2: Keep costs low.

#3: Make it a low stress… diversified… based on good value and easy to use process.

Those are my investing rules.  I have too many things in life to waste time trying to predict the unpredictable.  No one knows what the short term fluctuations in stock markets will be.

I implement my strategy using the analysis of Keppler Asset Management.  Keppler tracks and analyzes every share in over 40 stock markets around the world.  Based on a compilation of all those values Keppler determines which of the markets represent good, neutral and poor value.


Keppler’s (red line) 25 year predictions of global stock markets.

I have worked with Keppler over 25 years and found that their predictions are highly accurate in the long term.

I invest equally in ETFs that represent Keppler Good Value equity markets.  My portfolio’s balance is 70% developed markets and 30% emerging markets.

This is so easy.   The 18 shares in the portfolio represent hundreds of shares so it is highly diversified.  I rarely need to trade so it’s low cost.  And it takes almost no time at all.  I track the portfolio more often than not only because of the course I teach (Purposeful Investing Course).

Otherwise I would not have to look at my portfolio more than once a month.

This is simple, easy, cheap, low stress and logically… the most profitable way to invest… in the long term.

Let me share the current portfolio. Then I’ll share two exceptions to my rules.

This is an actual portfolio we created, at online brokers Motif.com, when we started the Purposeful Investing Course.  We use this portfolio’s real time performance to develop the regular “update lessons” that we send to subscribers of the course.


The two exceptions in my portfolio are in Canada and China.

Canada is a Keppler neutral, rather than good value market, but 3.5% of my portfolio is invested in the iShares MSCI Index Canada ETF.  From a weighting perspective, I treat Canada as an emerging market.

However I treat China as a developed rather than emerging market.  Most emerging markets represent 2% to 4% of my portfolio.  Developed markets 6% to 9%.

China has been given the weighting of a developed market rather than an emerging market.  The iShares FTSE/Xinhua China 25 Index Fund – (symbol FXI) represents 8.5% of the Portfolio at this time.

I sit up and take extra notice when all three of my advisors tell me the same thing.

Keppler Asset Managers always recommends an equally weighted portfolio of good value markets.

Last week a message at this site ““Investing Opportunity in Canada” looked at how both of my other advisors, ENR Asset Management and Tradestops.com, show that Canada offers extra potential now. 

Now, Tradestops.com and ENR Asset Management also show that the Chinese stock market has extra profit potential.

The March 2019 ENR Market Outlook says:

The big news this winter comes from China where all local benchmarks, including the Shanghai Composite Index, have gained more than 20%.

enr asset management

But don’t get too excited: Chinese equities are still 48% below their all-time high recorded in October 2007.

Unlike other stock markets, Chinese domestic bourses don’t reflect the performance of the economy. Considering the spectacular GDP growth rates generated by China over the last 20 years, the stock market should have gone gangbusters. Instead, shares traded in Shanghai have gained just 50% since 1999 and remain almost 50% below all-time highs.

My portfolio holds the iShares FTSE/Xinhua China 25 Index ETF (Symbol FXI).

One factor that makes this ETF especially interesting to me now is its fast rising price, combined with plenty of room for growth, before it reaches any new all time high.

Here’s the performance of the iShares FTSE/Xinhua China 25 INdex ETF over the past 5 years.


The recent rise in FXI has been enough that on February 25, 2019 Tradestops.com issued a reentry alert.


Keppler Asset Managers lists China as a good value (BUY) market.  Tradestops.com shows that the trend for the Chinese ETF FXI recently turned bullish and ENR Asset Management recommended this ETF in March 2019.

I recommend investigating if investments in China and Canada make sense for your portfolio now.


Stress Less Investing


The stock market has always been the best place of places to protect and increase wealth over the long haul.   Yet it’s also been the worst place to lose money, a lot of it, quickly.

There are only three reasons why we should invest.  We invest for income.  We invest to resell our investments for more than we had invested.  We invest to make our world a better place.

The goal of investing should be to stabilize our security, bring feelings of comfort and the elimination of stress!

We should not invest in social networked protests that guarantee loss.  This is like burning our houses down in protest.

If we want to change the world, we should invest in good equities that bring profit and use the extra wealth to create something beneficial for mankind.

We should not invest for fun, excitement or to get rich quickly. We should not divest in a panic due to market corrections.

This is why my core stock portfolio consists of 16 shares and this position has hardly changed in five years.  During this time we have been steadily accumulating the same Top Value ETFs  and have traded only a few times.

The study below shows how a value based model portfolio that dates back to 1969 has outperformed almost every stock market in the world.



The US market has not been even close to the top performer over the long term.

The DQYDJ Dow Jones Industrial Calculator (1) shows that an investment in the Dow Jones (with dividends reinvested) has risen at an average of 10.74% over the last 50 (51 actually) years.


That’s 10.74% is pretty good, but an analysis of 51 years performance of all the developed stock markets shows that (using country indices as hypothetical investments) investing in the top value (not top performing) markets would have returned 12.5%.

The chart below shows the analysis.



An annual return of 12.5% compared to the 10.74% US return is a 1.76% per annum difference.  This may not seem like much,

In the long term the difference is huge.  Calculations from the investor.gov site (2) shows that $10,000 invested at the 10.74% compound rate turns $10,000 into $1,817,734.62 in 51 years.


Wow, that sounds pretty good until you look at the results of the 12.5% rates.  $10,000 grows to $4,062,362.22!

Investing in the top value (not the top return) markets earned $2,244,627.60 EXTRA!


$4,062, 362.22 means you would have $2,244,627.60 MORE by investing in good value markets versus $1,817,734.62  earned investing in the US market.  That almost 125% more money!

Here are the best value developed markets at this time (as of end of March 2021).

keppler 4-2021


No matter how we look at it, over time, value investing always wins!

Our portfolio is built around a strategy that’s taught in my Purposeful Investing Course (Pi).  I call these shares my Pifolio.  The course shows how to use the value analysis of Keppler Asset Management to create a portfolio of ETFs that cover undervalued stock markets.  I have combined my 50 years of investing experience with the study of the mathematical market value analysis of Michael Keppler, CEO of Keppler Asset Management.

In my opinion, Keppler is one of the best market statisticians in the world.  Numerous very large fund managers use his analysis to manage billions of dollars in funds.  However because Keppler’s roots are in Germany (though he lives and operates from New York) all of his funds are registered for the European Union citizens, Americans cannot normally access his data.

I was lucky to have crossed paths with Michael over 25 years ago, so I am one of the few Americans who receive this data so I can share it with Pi subscribers.

The Pifolio analysis begins with Keppler’s research that continually monitors 46 stock markets and compares their value based on current book to price, cash flow to price, earnings to price, average dividend yield, return on equity and cash flow return.  Keppler looks at these numbers and takes market’s history into account.

Fwd: keppler

Michael Kepler CEO Keppler Asset Management.

Michael’s analysis is rational, mathematical and does not worry about short term ups and downs.  Keppler’s strategy is to diversify into an equally weighted portfolio of the MSCI Indices of each good value (BUY) markets.

This is an easy, simple and effective approach to zeroing in on value. Little time, management or guesswork is required.  You are investing in a diversified portfolio of good value indices.

A BUY rating for an index does NOT imply that any one stock in that country is an attractive investment.  This eliminates the need for hours of research aimed at picking specific shares.  It is not appropriate or enough to instruct a stockbroker to simply select stocks in the BUY rated countries.  Investing in the index is like investing in all the shares in the index.  You save time and gain incredible diversification because all you have to do is invest in the ETF to gain the profit potential of the entire market.

To achieve this goal of diversification the Pifolio consists of Country Index ETFs.

Country Index ETFs are similar to an index mutual fund but are shares normally traded on a major stock exchange that track an index of shares in a specific country.  ETFs do not try to beat the index they represent.  The management is passive and tries to emulate the performance of the index.

A country ETF provides diversification into a basket of equities in the country covered.  The expense ratios for most ETFs are lower than those of the average mutual fund so they provide diversification and cost efficiency.

Here is the Pifolio I personally held at the beginning of 2021.   There have been no changes since.

70% is diversified into Keppler’s good value (BUY rated) developed markets:  Germany, Hong Kong, Italy, Japan, Norway, Singapore, Spain and the United Kingdom.

30% of the Pifolio is invested in Keppler’s good value (BUY rated) emerging markets: China, Brazil, Chile, Colombia, South Korea, Malaysia and Taiwan.

There is one trick Pi subscribers learn about China which is different from the rest of the funds.

iShares Country ETFs make it easy to invest in each of the MSCI indices of the good value BUY markets.

For example, the iShares MSCI Germany (symbol EWG) is a Country Index ETF  that tracks the investment results of the MSCI Germany Index. The fund invests at least 80% of its assets in the securities of its underlying index that primarily consists of all the large-and mid-capitalization companies traded on the Frankfurt Stock Exchange.

iShares is owned by Black Rock, Inc. the world’s largest asset manager with over $4 trillion in assets under management.

There is an iShares country ETF for every market in our Pifolio.

This year I celebrate my 53rd anniversary of writing about global investing. Our reports and seminars have helped readers have better lives, with less stress yet make fortunes during up and down markets for decades. This information is invaluable to investors large and small because even small amounts can easily be invested in the good value shares we cover in our seminar.

How you can create your own good value strategy.

Stock and currency markets are cyclical.  These cycles create extra profit for value investors who invest when everyone else has the markets wrong.  One special part of your course looks at how to spot value from cycles. Stocks rise from the cycle of war, productivity and demographics.  Cycles create recurring profits.  Economies and stock markets cycle up and down around every 15 to 20 years as shown in this graph.

The effect of war cycles on the US Stock Market since 1906.

Bull and bear cycles are based on cycles of human interaction, war, technology and productivity.  Economic downturns can create war.


The chart above shows the war – stock market cycle.  Military struggles (like the Civil War, WWI, WWII and the Cold War: WW III) super charge inventiveness that creates new forms of productivity…the steam engine, the internal combustion engine,  production line processes, jet engines, TV, farming techniques, plastics, telephone, computer and lastly during the Cold War, the internet.  The military technology shifts to domestic use.  A boom is created that leads to excess.  Excess leads to correction. Correction creates an economic downturn and again to war.

Save $124.50 If You Act Now

Subscribe to the first year of The Personal investing Course (Pi).  The annual fee is $299, but to introduce you to this online, course that is based on real time investing, I am knocking that down to $174.50 in this special offer.  Plus I am reducing annual renewals from $299 to only $99.

I would like to send you, on a no risk basis, a 130 page basic training course that teaches the good value strategy I use.   I call this strategy Purposeful Investing (PI).  You learn all the Pi strategies, what they are, how to use them and what each can do for you, your lifestyle and investing.

You get this course when you enroll in our Purposeful Investing program (Pi) with a triple guarantee.

Triple Guarantee

Enroll in Pi.  Get the 130 page basic training, a 46 stock market value report, access to all the updates I have sent in the past five years right away, plus numerous updates over the next year. 

#1:  I guarantee you’ll learn ideas about investing that are unique and can reduce stress as they help you enhance your profits through slow, worry free, easy diversified investing.

#2: I guarantee to send you monthly updates that are based on a study of every share in 46 stock markets around the world.  These updates will show the values, the earnings of all these markets and categorize each market as Top Value (buy), Neutral Value (hold) or Poor Value (sell)

#3:  If you are not totally happy, simply let me know. I guarantee you can cancel your subscription within 60 days and I’ll refund your subscription fee in full, no questions asked.:

You have nothing to lose except the fear.   You gain the ultimate form of financial security as you reduce risk and increase profit potential.

When you subscribe to Pi, you immediately receive a 120 page basic training course that teaches the Pi Strategy.   You learn all the Pi strategies, what they are, how to use them and what each can do for you, your lifestyle and investing.

You also begin receiving regular emailed Pifiolio updates and online access to all the Pifolio updates of the last five years so you can back track if you desire.  Each update examines the current activity in a Pifolio, how it is changing, why and how the changes might help your investing or not.

Subscribe to a Pi annual subscription for $174.50 and receive all the above.

Your subscription auto renewal will only be $99 a year from now, if you renew, but you can cancel at any time.




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