"Firstly may I thank you for your very sound advice and comment in the past, I have been a subscriber for probably fifteen years and my investments have multiplied considerably, especially of late, the last 22 months when they have positively performed miracles. I consider that it takes a very sound advisor and an investor with a certain amount of nerve to perform in sectors previously considered to be potentially risky but the rewards have certainly been there for the trusting. I wonder David if you might endeavor to comment on a very simplistic question that I am sure doesn't have a simplistic answer. It seems to me that "Progressing Markets" are at the very least in a period of medium term consolidation and potentially at a very difficult point to decide what direction they might take or react regardless of the rights or wrongs of the case. Eg Substantial gains and charts progressing forever upwards must cause doubts. I take the point that quite logically these are the markets with the most secure future in a logical and trouble free world. In my view a consolidation of possibly 10- 15% might be reasonable even if not logically deserved. I note your reference to "Dividend Aristocrats" fairly frequently and pose the question after a period of considerable profitability as to the correct proportion of investment capital it might be prudent to apportion into , let us say , Secured capital,( by this I mean an investment that doesn't fall off dramatically in the event of a market rethink). Fuller money "Developing Market" themes and for example "Gold, Precious metals or general Commodity funds" Incidentally I have been invested 100% along the two later themes for probably ten years.

"I don't wish to waste your printing space but it occurs to me that periods of high profitability inevitably come to an end ,all be it gradually and the general shape of ones investments should alter to protect ones gains.At what point does one say "just perhaps we might protect our gains and how sensibly does one do it"? Could you Review particularly "Dividend Aristocrats" . I note that I read a report from an "expert" last week suggesting "buy gold, water, peanuts, fine art, whatever you fancy, but don't hold cash"

"Thanks again for a great service."

David Fuller's view Thank you for your kind words; your considerable interest in the Fullermoney global strategy service over many years, and congratulations on having the courage to seize your opportunities. I also thank you for some very important observations and questions of general interest.

In addressing these questions, let us begin by reminding ourselves of the extreme boundaries in terms of what markets do. Specifically, and in question form:

a) When has a sustained bear market decline culminating in a terrifying crash not proved to be a great buying opportunity?

b) When has a multiyear, dramatically accelerating and euphoric bull market not proved to be a great selling opportunity?

We saw (a) above in 2008 and you have been rewarded for your prescience in anticipating the recovery which has taken most Fullermoney theme markets to new all-time highs.

Have we now seen (b) above? Certainly not, which puts the risk in perspective as we no longer have anything like what we now know was 2008's banking debacle and subsequent credit crunch. However the stock market recovery appears all the more impressive because consensus expectations were so low. Nevertheless we have seen a number of overextensions relative to the 200-day moving averages which are a good approximation of the medium-term trend. That remains Fullermoney's preferred time for taking some profits. Additionally, we have seen commodity price inflation which Fullermoney cited repeatedly as the main risk in recent months.

Yes, I agree that most progressing markets are in a period of medium-term consolidation. This should be 'the pause that refreshes', provided commodity prices do not spike significantly higher. I am concerned about that prospect, which would probably cause more than 10-15% corrections, because we have yet to see evidence that commodity prices are retreating across the board. Since the fundamentals of supply and demand remain bullish, that would presumably require a pullout by speculators, whether of their own accord or more likely, nudged by the CFTC. (See also last Thursday's lead item.)

Regarding "secured capital", other than cash as a temporary holding I am not sure what qualifies. You may recall that I did attempt to lower risk in my personal long-term portfolio last year, first by selling Lihir Gold in June, and investing the proceeds in Royal Dutch Shell B shares. A month later I sold the excellent BlackRock Gold & General Fund, not because I did not like it, but because it had done so well and I was buying the underperforming but higher yielding China Mobile, which has continued to underperform. Later, I sold part of a high-flying Asian fund to buy a recovering uranium share.


I only mention these portfolio changes once again because they may address part of you email, in that I was trying to lower risk within my personal investment account by switching to less fashionable investments which mostly also had higher yields. Regarding 'Dividend Aristocrats', which Eoin has covered in considerable detail, we maintain that companies with a consistent record of increasing dividends should outperform during a stock market corrective phase.