Global Capital Management (GCM) Kevin Lucey (posted first 15-11-2006)

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celticcc1

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Hi,
Just wondering if any of you have invested money with Global Capital Mangement (GCM). He gave a spiff at an ICES group meeting in Cork earlier this year and i joined his site as a member so as to gain access to his stock watch list. He came across as a very impressive person. I have his 2006 portfolio and he is performing quite well. His track record over the past 5 years appears to be very impressive (23 to 50% annual returns). He is a value investor who follows the Buffett strategy of finding out of favour undervalued stocks that are trading below their intrinsic value.
For the record i am a failed "investor" as far as the stock market is concerned. I gambled like many in dotcom companies that subsequently got hammered post 2000. I aim to be more prudent in the future wrt to my investments and am to recoup my losses (i am still 30% under water and am a bit sick about the fact that a similar investment in the hosuing mkt would have at least doubled in that time).
I would appreciate any help from like minded investors.
thanks in advance.
 
Re: Global Capital Management (GCM) Kevin Lucey

I have never heard of the guy, but I would be skeptical about anyone who makes their living giving tips on investments.

5 years is a very short period and any excess return over that period is probably due to chance alone and not statistically significant.

There are lots of people who do well over a short period and then revert to the mean.

These tipsheets are often scams. They make their money from subscriptions. If they are so good, why don't they make their money from investing? Buffett does't run a tipping service.

Many people claim to be "value investors" or "growth investors" or to be applying Buffettology but it means nothing really.

Overall your best approach is to buy a portfolio of shares and hold them for the long term. You save in dealing costs and in subscriptions to tipping services.

Brendan
 
Re: Global Capital Management (GCM) Kevin Lucey

Or try a low cost index tracker - that way you'll only do as badly as your index (DJ EuroStoxx 50, for example) and are less vulnerable to the variations of individual shares and the cost associated with paying for tips and frequent trading.
 
Re: Global Capital Management (GCM) Kevin Lucey

I have never heard of the guy, but I would be skeptical about anyone who makes their living giving tips on investments.

These tipsheets are often scams. They make their money from subscriptions. If they are so good, why don't they make their money from investing?

Lucey runs a private investing fund and has invested over 40 million euro since 1999.

He does make his living from investing, "charging clients only when returns of 10% are reached. When gains of 10% are reached, a management fee of 5% is only then applicable. All gains in excess of 25% are shared 50/50 between clients and ourselves" (from his website at www.activeinvesting.com).

The money he makes from people paying to access his portfolio is presumably small compared to the money he makes from managing money in the markets. I would never pay to access such material but it's hardly fair to dismiss him as just another common tipster.

5 years is a very short period and any excess return over that period is probably due to chance alone and not statistically significant.

Maybe. Or maybe he knows what he is doing. The fact that a majority of people underperform the markets does not take away from the fact that a significant minority consistently outperform it.

Overall your best approach is to buy a portfolio of shares and hold them for the long term.

I respect your opinion Brendan, but that's all it is - an opinion, not a fact.

(BTW, I have no connection whatsoever to Kevin Lucey).
 
Re: Global Capital Management (GCM) Kevin Lucey

Brendan said:
I If they are so good, why don't they make their money from investing? Buffett does't run a tipping service.
Brendan
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Always, always, always ask yourself this question when beiong offered this type of advice. Unfortunately. with the recent upturn in the stock market and downturn in real estate, we are going to see a lot more of these shysters peddling their "wisdom".

edit - I just checked his website, where he lists his buys and sells since 2000. If I read it correctly, he has never had a loss - all the more remarkable as he had no commodity stocks during a major commodity bull market! Is this the guy who was featured on the Sunday Times a few weeks ago that used to work at Intel?
 
Re: Global Capital Management (GCM) Kevin Lucey

charttrader said:
The money he makes from people paying to access his portfolio is presumably small compared to the money he makes from managing money in the markets.
.
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Why do you say this? Any indication it's true?
 
Re: Global Capital Management (GCM) Kevin Lucey

charttrader said:
He does make his living from investing, "charging clients only when returns of 10% are reached. When gains of 10% are reached, a management fee of 5% is only then applicable. All gains in excess of 25% are shared 50/50 between clients and ourselves" http://www.activeinvesting.com).
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Recognise that this kind of fee structure creates a moral hazard for the money manager.Value investments should only expect modest gains and should not go much higher than 10% annual return if at all,wheras riskier investments would give a greater expected return to the money manager.

I couldnt find the information of the fees on the website,charttrader,can you post the link to the actual page.


1500 fee for their online content does seem expensive
 
Re: Global Capital Management (GCM) Kevin Lucey

Quote:
Originally Posted by charttrader

The money he makes from people paying to access his portfolio is presumably small compared to the money he makes from managing money in the markets.

Why do you say this? Any indication it's true?

Am basing it on the fact that his website claims to have averaged "an annual compound rate of return in excess of 45%" over the last five years and that he is managing millions (a report in the Irish Indo at the beginning of 2006 said he has invested 43 million euro since 1999).

Dunkamania, the fees i quoted are referred to near the bottom of the home page.

Would like to add that i am not recommending investors fork out 1500 a year to follow someone else's buying and selling. I think that is mad money.

I also do not believe in conventional tipping services and pretty much agree with Ed Seykota, who said that good traders trade while good letter writers write letters.

My point is simply that it's a bit rough to say that Lucey makes his living giving tips and that he appears to have done well for himself through market investments.
 
Re: Global Capital Management (GCM) Kevin Lucey

I'm not commenting on the guy or his company as I have no information on him, but the charging structure you quoted is interesting. If I was unscrupulous, what's to stop me investing (say) money from half my clients in a short sale of some very volatile index like Brazil, and the other half in a bet that the Brazilian market will shoot up. Half my bets will come through and I collect my large fees, the other clients I can tell to go somewhere else. You're essentially being given a free bet with client money.
 
Re: Global Capital Management (GCM) Kevin Lucey

I have never heard of the guy, but I would be skeptical about anyone who makes their living giving tips on investments.
Surprised you never heard of him. Read a few articles in the press about him e.g.
http://www.evening-herald.ie/irish_independent/stories.php3?ca=47&si=1547575&issue_id=13583
He is mainly dealing concerned with the GCM fund (€200k entry) and for a fee of €1500 per year he gives access to his stock watch list and current holdings on his website. He also gives updates on the US markets and individual stock holdings (often advises subscribers to sell prior to events such as earnings, etc so as to lock in profits). It is a decent service in my opinion.
5 years is a very short period and any excess return over that period is probably due to chance alone and not statistically significant.
understood.
There are lots of people who do well over a short period and then revert to the mean.


These tipsheets are often scams. They make their money from subscriptions. If they are so good, why don't they make their money from investing? Buffett does't run a tipping service.

Many people claim to be "value investors" or "growth investors" or to be applying Buffettology but it means nothing really.
understood.

Overall your best approach is to buy a portfolio of shares and hold them for the long term. You save in dealing costs and in subscriptions to tipping services.
Easier said than done. How may people have more than a few hours a week to keep up to date with a) the markets b)companies' performance. I spend 2-3 hours a week on same and find it very difficult to keep up with it. Therefore i feel that the €1500 service is very handy and i can vouch that the updates from Kevin have been failrly spot on to date (i have been a subscriber for the past year).

I am a natural skeptic and am open to all advice/suggestions. One thing is that GCM are apparently in the process of being regulated by IFSRA. Is there any way of checking this out. Also, is there any way of getting the fund returns. I tried the Company Registration Office and while i found the business name, i found no a/c returns.

Again, Thanks for the responses.
 
Re: Global Capital Management (GCM) Kevin Lucey

celticcc1 said:
Easier said than done. How may people have more than a few hours a week to keep up to date with a) the markets b)companies' performance. I spend 2-3 hours a week on same and find it very difficult to keep up with it. Therefore i feel that the €1500 service is very handy and i can vouch that the updates from Kevin have been failrly spot on to date (i have been a subscriber for the past year).

.
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there have been numerous studies to suggest that in the long term you would be better off buying and holding the Index.
 
Re: Global Capital Management (GCM) Kevin Lucey

dunkamania said:
there have been numerous studies to suggest that in the long term you would be better off buying and holding the Index.
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better off than what? Buying individual stocks? I'm not really interested in buying indices. Returns are too low
 
Re: Global Capital Management (GCM) Kevin Lucey

celticcc1 said:
better off than what? Buying individual stocks? I'm not really interested in buying indices. Returns are too low
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well then you are going to have to do *a lot* of work to beat them and do better than the majority of money managers.

From "Random Walk Down Walk street" ps 189

HTML: 
<pre>                 10 years    15 years    20 years
Average Large Cap Fund   10.98       11.95       13.42
S&P500                   12.94       13.74       15.24

                  Average annual Return
                                 1970s        1980s
Top 20 funds of the 1970s        19%           11.1%
Average of all funds             10.4%         11.7

                  Average annual Return
                                 1980s        1990s
Top 20 funds of the 1980s        18%           13.7%
Average of all funds             14.1%         14.9%</pre>


I think the figures speak for themselves
 
Re: Global Capital Management (GCM) Kevin Lucey

celticcc1 said:
better off than what? Buying individual stocks? I'm not really interested in buying indices. Returns are too low
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Index returns are higher than managed funds over long periods of time
 
hello,are you still a subscriber to gcm,if so hows it going.
 
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