What Your Mutual Fund Manager Doesn’t Want You To Know About Your Retirement

Let me ask you a question…

Are you confident that your retirement will last?

The truth is, for millions of people approaching retirement, it won’t…and that’s a scary thought. Fortunately, there is a way to make your retirement fund work for you and have enough to retire in 20 years, even if you think that it’s too late to start.

I want to prove to you that you can learn how to invest your hard-earned nest egg and get great returns all on your own.

Someone did the same thing for me and it changed my life.

I want to start with this basic concept. You can learn how to:

  • Generate consistent, good returns in the stock market, by doing something really simple.
  • Buy wonderful businesses, and buy them when they’re on sale.
  • Copy and follow the best investors in the world such as Warren Buffett, Charlie Munger, Mohnish Pabrai and hundreds of others.
  • Protect yourself from downward moves in the stock market that come along regularly.

I’ll show you how to do these things in my Transformational Investing Webinar.

If you’re not sure about why I want to do this for you, let me explain…

Why I Teach Rule #1 Investing

Let me give you a really quick idea of my background and why I do this.

I wrote two New York Times #1 Best Sellers called, “Rule #1” and “Payback Time” that teach you how to invest and get great returns.

Before I did this, I came from a blue-collar background. I was in the military and went to Vietnam. When I got back from Vietnam, I became a river guide out in the Grand Canyon.

When I started investing on my own, I started with just $1,000 and I turned it into $1.45 million, which would be about $3 million today. All because someone taught me how to invest this way.

I did that in just five years…

I had no amazing talents and I wasn’t even interested in investing.

I was not a Wall Street guy…Or a Harvard Business School guy…

And I was probably in a much worse financial situation than you’re in. I was making $4,000 a year, and living out of a black bag.

I went from a nobody river guide to a hedge fund manager. The truth of the matter is, if I can do it, you guys can do it too.

Why Should You Learn This?

You may be asking yourself, “Why should I learn this stuff?”

That’s a really good question…

The world is a little scary. I think it’s worth taking the time to talk about why it’s so scary, and what that means for us.

The first thing that’s alarming is that the things that used to work out in the marketplace, don’t work anymore.

These are the things that friends of mine, experts at financial planning and working with your money, are doing and teaching. I’ll bet you know who a lot of them are. They are household names, they have DVD sets, programs, and books that are teaching you techniques that don’t work anymore.

They’ve learned how to invest a certain way based on the 1980’s, the 1990’s, and into the 2000’s. During those times, the market was going up and always corrected itself. Now we’ve gone from a market that was at 600 back in 1980 when I started investing, to one that is around 18,000. The very things that used to work in a big, huge, bull market like that of the 1990’s, would kill you in a bear market like we’re going into.

And unfortunately, the way most everybody is investing money today is based on outdated advice.

The Mutual Fund Lie

The mutual fund industry and the financial services industry try to make you believe that you should never be out of the market, and you should always invest for the long run.

And that you can’t beat the market.

They try to make you believe you can’t possibly invest on your own…

And their answer is to put your money into mutual funds.

I’ll show you what mutual funds do in markets like this one, or pretty much any other market.

Effectively, mutual funds as Jack Bogle, founder of Vanguard, has figured out, are just a shadow of the market. The mutual fund managers charge you huge fees to actively invest your money, in order to beat the market….

But the truth of the matter is, they don’t beat the market.

“People get nothing from mutual fund managers.” – Warren Buffett

For example, Warren Buffett thinks that mutual funds managers aren’t going to give you any returns in the market. Jack Meyer, from Harvard Business School, thinks that mutual fund investing is a gigantic scam.

Where Should You Invest Your Retirement?

If the stock market, mutual funds, bonds, gold, and real estate all seem so dangerous to invest in, where is your safe haven for your retirement?

The answer is an 84-year old tradition of investing that we call Rule #1 Investing.

This strategy gives you peace of mind.

Ben Graham started this back in the 1930’s and compounded money using these tools during the Great Depression and World War II, at over 22% a year. That means he was doubling his money almost every 3 years while the rest of the country was in enormous financial difficulty and distress.

He taught that very way of investing to Warren Buffett, who taught it to a number of other investors.

These investors are what I call the old-school Rule #1 investors. These are guys like Ben Graham, Charlie Munger, John Templeton and a bunch of other guys. These heavy hitters have produced returns that are simply impossible to get if you can’t beat the market (as the financial industry wants you to believe).

And if you can’t beat the market, these guys can’t exist, right?

Not only do they exist, but today modern investors have copied what they’ve been doing, and are generating consistent returns. Guys like Bill Ackman, Warren Buffett, Mohnish Pabrai, Edward Lampert, David Einhorn, Julian Robertson, and Lou Simpson. All of these guys invest in the Rule #1 style of investing.

These guys have been compounding money at great rates of return. They’re averaging 27% per year on their investments.

Their portfolios have been audited by the SEC over 20 and 30 year periods of time, verifying their returns.

They’re doing what the financial services industry says is impossible, but weirdly, it’s even easier for a little guy (such as you) to invest like this, than for these big guys to do it.

I want to show you how to do Rule #1 investing and give you the confidence to invest on your own, here’s how to take the first step.

My Transformational Investing Webinar

Here’s what we will be sharing with you during the webinar…

  • How to generate consistent returns by buying wonderful businesses when they’re on sale.
  • How the best inventors in the world like Warren Buffett get consistent returns on their investments.
  • How to protect yourself from downside market moves.

Click the button below to sign up to watch the upcoming webinar. You will have an opportunity at the end to go to a 3-day Transformational Investing training in Atlanta absolutely free. Think it’s too good to be true? I have hundreds of students who say otherwise.

Claim your spots soon because these things always fill up fast.


Phil Town is an investment advisor, hedge fund manager, two-time NY Times best-selling author, ex-Grand Canyon river guide and a former Lieutenant in the US Army Special Forces. He and his wife, Melissa, share a passion for horses, polo and eventing. Phil’s goal is to help you learn how to invest and achieve financial independence. You can follow him on google+, facebook, and twitter.
  • TzuZen

    I was hesitant to attend the 3-day workshop. I am not a ‘testimonial’ kind of person. Testimonials actually are a negative – I wonder what the catch is. I tend to not trust testimonials.

    You were serious that it is a work filled weekend – little fluff. That’s what I wanted. My coaches Robert and Michael were great. Robert worked with me til nearly midnight Friday night. Michael gave me some good insights Saturday morning when discussing some concerns I was having regarding the company I was focusing on.

    The weekend’s material wasn’t dry – I was fully engaged. I had reread Payback Time prior to class. Side note: I was bummed to see how the free internet resources have changed since the book was written and how much harder it is to dig around for the info on my own.

    I am quite grateful that you, Melissa, Earl, Jeff, Michelle, Sonya and the team of coaches and staff would actually do this program as advertised – no selling. No whiff of selling 2 weeks later either. There really isn’t a ‘catch’. I do look behind me (metaphorically) to be sure this is real. If someone doesn’t want to use the toolbox, you’ve still got the excel calculators on the site, too.

    I’ve been doing my homework. Finally, the concepts in my well dog-eared, studied books of yours are finally gelling. having the coaches present for specific questions was awesome.

    Now if my three businesses I’ve been doing homework on would go on sale… I need to learn more about these companies as well. Will the Story change? If it does, perhaps it will become less wonderful.

    Thanks again to you and the Rule 1 Team for helping me begin cementing the concepts of investing.

  • TzuZen

    The 3 day workshop a few weeks ago was very worthwhile. I’ve finished my homework.

    I want and need more help on the options trading part. I understand the BPS and tested through the data available via thinkback on ThinkOrSwim. While I feel comfortable with the mechanics, the ‘when to bail out strategies’ need more clarification. The information was outlined yet physical examples were not presented.

    I need the visual. Are there more resources available on this part?


    Susan Parker

  • Luke McCannell

    Digging in on ZINC some more, this is def worth a read. http://www.sec.gov/Archives/edgar/data/1385544/000119312515352033/d92188d424b5.htm
    Would like to know others thoughts on it as well.

    • Michael McIlhinney

      I have no problem with them preparing to raise additional capital and dilute shareholders a little bit more if needed. Zinc is kind of like a call option to me. Time is the enemy bc they have to be right (ie fix the plant before the debt comes due). This offer will be like rolling that option out which is fine if you believe the price should be $12 minimum and really more like $25-$30.

      • Garrett Woolley

        Hello Rulers and Michael!

        Last week on Oct 23rd one of my Ruler buddies zapped me an email that ZINC had filed for the option to do a stock offering to raise capital.

        We expected that they would at least get the paper work filed in the event they ran low on cash in 2016. It seems Mr. Market didn’t expect that to happen and it increases the possibility that existing shareholders would get diluted.

        First, I think it would be prudent for management to be prepared in the event that they do need it. Just because they filed doesn’t mean they will. But it does increase the odds.

        Second, if you understand Options, I like what Michael said above. Which would you rather have as an investor in ZINC? No money to fix the plant and we go bankrupt or money to fix the plant and we get diluted? By raising capital, if necessary, we buy time.

        Obviously, nobody likes to get diluted as a shareholder. And Phil has used the pizza analogy on numerous times to explain what happens in simplest terms.

        Let’s say there are 8 Rule #1 Investors eating together at our favorite pizza restaurant. It’s Michael, Phil, Jeff, Michelle, Melissa, Nancy, Earl, and Garrett. We’re all eagerly waiting to enjoy our brick oven pizza and cut our pie into 8 equal slices.

        Suddenly, Management shows up and invites Janet Yellen (The FED) , Mario Dragi (The ECB) and Christine Lagarde (The IMF) to our little party.

        Interesting company, indeed, but the result is instead of having 8 slices we now have the same size pizza but have to share it with 11 people. We’ve been “diluted!” as pizza owners, yet we paid the full price.

        That’s an oversimplification, but essentially that’s what happening. We still own the pizza, but less of it for the same price.

        In return, Management was able to raise some money. Suppose each slice was $2.00 a piece. The pizza was $16.00 total for 8 slices. Now, management says the pie is still worth $2.00 a slice but the slices are smaller. The cost of the pizza is 11 slices x $2 =’s $22.00.

        Now, if Management took that profit $22 – $16 =’s $6.00 per pie and bought a jet plane so he could look for a cabin in Montana, we’d be pretty ticked off.

        On the other hand, if Management takes that money and uses it to create more stores, we might be ok because we’ll be more profitable.

        So how does ZINC Management expect to use the money if they indeed decide to dilute us?

        We know they will use it to get the plant to full production. And that’s why Michael kind of says it’s a good thing.

        Look, let’s get rational here. The Mooresboro facility works. There are about 60+ fixes in the interim to get it to full production. There are two other plants like this where management hired those individuals to get the thing to full production. We just have to wait it out…or at least I do because I’m deep in the red on this one in my retirement account.

        We’ve looked at ALL this before as part of our “Story” and worse case scenario on ZINC. We’ve looked at dilution, falling zinc prices etc.

        For the moment, the Story on zinc prices that Goldman put out was that they think $0.90 per pound is in the ballpark. We’re good with that. We want to see it around $0.85 per pound for the most part.

        What happens to our estimated ZINC price if we get diluted? First, we have to make an educated guess on how much they would need. I’m going to say $50 to $60 Million. Let’s go with $60 Million…as those numbers are from the CFO himself in earnings reports.

        How do they do that? They offer stock at some price. The last time they did this it was just under $13 per share while the stock was about 15% or so above that. Let’s just grab numbers out of thin air and see what happens.

        Management isn’t going to do a stock offering on ZINC at $2.60 per share. That would be insane and completely dilute all investors with so many new shares that the CEO would get fired.

        For example, if we needed $60 Million TODAY (we don’t so don’t worry…this is just to show you) we would take $60 Million divided by some discount on the stock…say $2.30 per share and we’d get $60 Mil / $2.30 =’s about $26 Million more shares.

        How many shares do we have today? Just look up “shares outstanding” and we see we have about 56.6 Million shares

        So offering 26 Million more shares on top of the 56.6 million would be an exorbitant and egregious dilution to existing shareholders. That won’t happen at today’s prices. Agreed??

        What do to? Well, if Management wants to raise capital, they have to wait. They can’t do it at this share price. It would happen after they get the plant running better and start giving more forward OPTIMISTIC guidance or as Phil would say..they’d do it after some “good news” and the stock price climbs back up to our book value number or something close to that.

        Then management can say to the firm doing the stock offering…”Ok, raise us the capital at $8.00 per share (or whatever)”

        Now we have vastly different and lower (still ugly) dilution. $60 Million needed / $8 per share =’s 7.5 Million shares. So we go from 56.6 million shares to 56.6 + 7.5 =’s 64.1 Million shares.

        Here’s the good part…our Mooresboro facility is up and running if that happens our company is worth $1 billion or more based on Management’s forecasts. Why $1Billion? Where’d I get that number? I got it based on our forecasted earnings before interest, taxes, depreciation and amortization (EBITDA) and putting an 8 times multiple or so on it. I’m using 8 as a guess that Mr. Market would pay 8 times for ZINC’s EBIDTA. If I remember correctly, MANAGEMENT has said that EBITDA once the Mooreboro facilty is in full or close to full production would increase our EBITDA to about $140 Million. $140 Million x 8 =’s $1.12 Billion…so that’s what I’m estimating our company is worth. Today Mr. Market says that it is only worth $2.60 per share x 56.6 Million shares outstanding =’s $147 Million (the Market Capt).

        So going from $147 Million to over $1 Billion is a huge home-run IF we get this right. It could be a huge failure or the biggest home-run ever.

        Now we take that $1.12 Billion divide it by our estimated diluted share value of 64.1 Million and….we get 1.12/64.1 =’s $17.47 per share.

        That’s just my guess. It’s something to keep in mind. I didn’t learn all this stuff on my own. I’ve learned a lot from Phil and my own Rule #1 Buddies who are into this stuff too. Phil’s got a TON of extremely valuable stuff on his blog and website FREE. Use it. Go to one of his Transformational Investing Seminars in Georgia and find some fellow Rulers who share your enthusiasm.

        Next I want to dig a little into Whole Foods. I have a very, very conservative Bear Call Credit Spread. If you don’t know what that is, get in touch with Michelle and into Jeff Town’s class at support@Ruleoneinvesting.com

        And on a final note…My stock investments are suckin’ right now! Other investments are doing ok as I’m about 1/3 cash, 1/3 real estate and 1/3 stock more or less. Let’s plan for a safe and low risk retirement in 19.5 years.

        To Your Wealth!

        • Garrett Woolley


          After re-reading my own post…I had another thought. I’m taking an educated and reasonable guess that ZINC’s recent sell-off (again) is due to the filing for raising capital and hence investor dilution.

          Is this a buying opportunity “on the dip?”

          Suppose Management DID raise $60 Million today and did it at these prices.

          What’s our new valuation based on a such a severe dilution?

          Using my above estimates, we take 56.6 Million shares outstanding, plus about 26 Million =’s 82.6 Million shares.

          If, if, if…we get stable ZINC prices at $0.90 cents per pound and FULL production…what’s the value of our company per share if Mr. Market pays 8x for that EBITDA of $140 Million?

          That’s our $1.12 Billion Value / 82.6 Million shares =’s $13.56 per share.

          Just something to keep in mind. I think it shows how much Mr. Market thinks Mooresboro facility is going to be a failure and the company is going to go bankrupt.

          Remember, we always want a Margin of Safety. And optimism is the enemy of great investing.

          To Your Wealth!

        • Ryan


          Is Jeff Town’s class offered online? For that matter, are there any classes offered online other than the three videos under Education> Tutorials > Online classes?


          • Garrett Woolley

            I didn’t want to answer for Jeff, so I shot him an email and I’m sure he’ll get right back with an answer.

            To Your Wealth!

          • Garrett Woolley


            Here’s what Jeff said:
            Hi Garrett,

            Yes, we are teaching the Rule One Transformational Investing Course online. The course is 26 weeks long. Two classes per week for the first 13 weeks and then one class per week for the final 13 weeks.

            We have three instructors: me, Dr. Andy Bargerstock and Earl Davis.

            Ryan – if you get in the class then JP or Corey will place you with one of the instructors. JP and Corey are usually the inital contact to determine which course is best for you. I’ve met them both several times and I know Jeff and Earl. I haven’t met Andy Bargerstock.

            To Your Wealth!

          • Ryan

            Thanks Garrett, I really appreciate your help. How do I get into that class?



          • Garrett Woolley


            Sorry for late reply…Prerequisite is to attend the FREE Transformational Investing Seminar in Atlanta. There’s a form on ruleoneinvesting.com you need to fill out in order to attend.

            Also, I was recently informed that I shouldn’t post anything on the blog about Rule #1 educational type courses.

            My limited understanding is that nobody wants the blog to be used as a tool to pressure or entice or seem as if someone has a hidden agenda. That seems pretty honest and fair, yes? So in the future, I’ll refrain from commenting about getting additional training in Rule #1 Investing other than suggesting y’all attend the free weekend in Atlanta – where Phil goes all out and even treats everyone to a huge 200 person BBQ at his ranch. It’s a great time to meet like minded people and make some new friends.

            All the details are already on his website.

            To Your Wealth!

          • Ryan


            Great thanks very much. Sorry to get you in trouble. Just need to figure out how to get down there.


          • Bradlewski

            Hey Garrett.

            Looks like most of your posts on this have been deleted. So far, this one is still up.

            Some of mine have been deleted as well. I agree that the Rule #1 educational type courses are for educational purposes only and the best way to learn about them is to attend the free workshop. Heck, the BBQ at his ranch alone is well worth the trip. On a personal note, I learn more from others than they learn from me. The candid conversations on what like minded people are doing and what they enjoy doing with not just investing but also enjoying their lifestyles. This is way better than the continuing education credits (CE) that many in the field have to attend.

            As a Fiduciary, I have no issues with this. I also understand, that not everyone on this blog has been to one. I would love hear from those as to why they have not attended the free workshop?

            Happy holidays and shoot me a post when your attending a workshop. I’ll be there too.

          • Garrett Woolley

            Hi Bradlewski! I will be sure to post when I get to a workshop. I’d like to be there to meet some of the people with whom I share my “unrealized” investing failures! Still bullish on ZINC!

            And I should have deleted those posts…I thought they were already deleted and never looked. Sometimes I reply to posts directly from the inbox in my email.

            I’ve enjoyed reading your posts as well sir, so thank you for contributing content! It’s nice to have someone on the blog with an education in this stuff as opposed to someone like myself who has just learned by trial and error, seminars, books, etc…

            Health before Wealth – time to go get some exercise!

            To Your Wealth!

    • Victoria Travis

      I couldn’t get into the site to read…..message: Opps, we can’t find this file.