Model Portfolio timbo56:SSOF1

Let's imagine that we lived in a society where in order to compete in professional golf, one had to have majored in golf at a prestigious golf college and needed to have done fairly well there. In such a system the professional golfers would be pretty good. But we have a different system to determine who gets to play in professional golf tournaments. It's called, "play golf." It is a better system, because although the system where one majors in golf would be a good system producing good golf players, who had all taken in courses called "golf swing 202" and participated in seminars with names like "sand trap strategies," the system where everyone just plays golf and the best player gets to move up to a higher level is a better system.

There are, of course, very important differences between golf and portfolio management. A golf game can be played in a few hours, but to really get meaningful results in portfolio management takes years. A real golf game can be played without entrusting anyone to big assets, but a real portfolio management game cannot. Accordingly, the portfolio management "competition," to be open to everyone, must be virtual. And one must be patient and wait at least years to get meaningful results. But just as the skills to do well in golf college would not precisely match the skills needed to be a play golf well (although there would likely be a strong positive correlation), so the skills needed to get a Stanford or Wharton MBA likely do not perfectly match those needed to successfully manage a portfolio (although, again, there is likely a strong positive correlation). As long as that correlation is not perfect, there is benefit to be had in opening up the process to all comers. It is a process that takes some patience, but we are seeing some real benefit now, with the MOFQX significantly outperforming its peer group of funds. It's because Ken Kam has found a better way of picking the pickers. The investment community would do well to take a good look at the Marketocracy model, because it is the wave of the future.