Thankyou to all those who took the time to grade our performance for the year and provide associated comments. The following chart shows the distribution of grades and we have included a selection of comments from each category below. After collating the results the average grade for the year was a C. 



Grade A

These are difficult and turbulent times, the sort of events that may come only once in 50 years. Your reporting has been accurate, factual and provides excellent links and insights into what is going on at all levels. FS.

A for All of these ....effort, neatness, presentation

B for Breadth of field ...... However, some "Worth Watching" ....without detailed analysis, would spice up the adventure. ( I'm sure you agree that this is one of the greatest adventures of a lifetime; certainly I find it so) ...

C for Charting... near-term line-drawing makes astrology look good. BUT if you think of the present events as "getting back to normal", after a 10 year break from reality, there is much to be gained from charts like E-trade's 1 decade charts!

D for Damned bad luck that events have run amok and Defied orderly thinking.
Have a happy Christmas, KT.

Grade B

I wasn't definite with my mark this year and had to leave it for a week before putting 'finger to keypad'.

It's been an amazingly terrible year for all but I am disappointed that a professional body such as Fat Prophets did not foresee how bad the markets went. It would have been great to sell "at a reasonable price" then buy back at bargain prices and get more shares.

Now I am stuck with a portfolio of 'buy and hold' until recovery takes place, which will likely take a while. However, there may be a spark of hope in gold. Thanks for your efforts, HB.

I think you provide a very good service. However, I know FP were predicting problems in the economy last year and I think some foresight that this would bring down equity prices so you could have provided some sell recommendations for members to lock in profits.

Also, some recommendations made on stocks with relatively high PE's in this volatile environment seemed a bit too soon, with the chart outlook having not improved. Further to my previous comment, I think the breakfast brief is very spam like and I signed to Fat Prophets for sophisticated research and technical analysis (cfd trading), not daily articles and member comments, which I don't have time to read.

I don't know if FP have put this out to try and enhance the service in light of the terrible market conditions where members have lost money? If this is the case, I think it is counter productive. TM.

At times there is not time to read your exhaustive reports and a summary would suffice. I acknowledge your added services ie Breakfast Brief , Blogs and Audio Weekly summary which I use infrequently but am sure many members would appreciate. Also appreciate the intermittent calls from consultants to FP as this makes you feel connected and valued. All the best RM.

While I continue to sit on the sidelines, reluctant to buy shares, so far I find your weekly word, breakfast brief etc. very informative and helpful. However I see that you also cannot really know what individual companies are facing if they fail to truly reveal what is happening (eg the OZ minerals story at the moment).

Because of globalization I believe you could improve by sometimes (perhaps monthly) giving some sort of commentary or resume of other markets, especially New York and London ie. specifically mentioning shares that you have knowledge about. Regards, SK.

Grade C

Dear Fat Prophets, Overall, I would grade your service performance overall for 2008 as a C.

No doubt the severe bear market meant that it was difficult and tough for everybody. However, while you may be right in the long term, what we have to deal with right now is to navigate our way so that members will both survive and prosper when market conditions begin to turn.

In my opinion, Fat Prophets could have done a better job at communicating and informing their members as to the short term risks of the recommendations that are made to members.

I find your big picture overview to be an excellent source of strategic planning for my long term portfolio, but the tactical positioning in the short term leaves much to be desired. Hence, my rating of a C. Sincerely, MT.

So many of your reports centred on the company you were analyzing and not the economic climate, which may I suggest, was the more relevant factor over the past year. Whilst your comments may have been quite pertinent for the long haul the more rational advice (admittedly with that awesome advantage called hindsight) would have been to sell your shares and buy back later …even now.

Fat Prophets and other financial adviser, have all stressed the “don’t panic” and that things will improve over time. I am sure this will be the case in time but better advice on selling and waiting and then buying back would have smartened up my portfolio with a 40% gain instead of a 40% loss.

I know you will say that your advice is for investing for the long term and not for trading but there is hardly a stock which you have recommended to hold which has not gone south and you usually finish your dissertation with “this stock will continue to be held in the Fat Prophets portfolio”. Not a pretty performance. RP.

1. You hold on to poor Investments too long, no clear strategy as to exiting these stocks.

2. I am a big fan of Gold but you haven't recognised the facts that Gold should be moving significantly higher, all the indicators are there, high money supply, flight to safety etc...yet it hasn't. Improved analysis would look at both sides of the story, perhaps we're wrong with our Gold prediction. I don't think you are but a more rounded commentary would be appreciated.

3. At times your commentary is like reading a blog. Particularly recent comments on GATA. Most investors are not interested in conspiracy theories.

4. To appease your readers you need to highlight some strong value investments in Q1 2009. DF.

In depth analysis is first class, however some recommendations proved too early with little foresight to market volatility that essentially proved to be the only constant. Most notable examples, MacCarthur Coal, Oz Minerals. AH.

Sad to say that I have not found this year's recommendation of any value. Particularly continuing to hold the OZL instead of selling Oxiana when the merger was proposed.

A SELL advice early in the year would have been the only valuable advice. Of course, with the benefit of hindsight, this is easy to say for me. But the fact is that the consequences of the "sub prime" crisis were underestimated seemingly by all in the finance industry. BD.


I’ve found Fat Prophets’ performance a difficult one to assess this year. In a macro sense, you’ve been pretty much spot-on, but at a micro level it seems you’ve been caught out (like the rest of us) by the degree to which the real global economy has been impacted by the financial contrivances of Wall Street.

Mid-year, you would have scored an A – the banking and property sectors were disaster areas, and commodities were powering – but that was 6 months ago (ages...!) and it’s impossible to ignore the share price collapse of recent recommendations such as OZL, SUN and CXC (I can’t throw stones, I’ve bought a few clunkers of my own). That highly leveraged (BNB and co) and speculative (almost all mining startups) companies have been beaten around is not surprising in the current environment, but I’m still struggling to understand why quality, cashed-up businesses have been dragged down with them – and to not a dissimilar extent.

Suppose that’s why I have been buying recently, it helps (hurts less?) to have a longer term outlook.

Gold has been a big winner this year (again), and you are certainly not “me too” latecomers to this commodity...buying gold a few years back has proven to be the best insurance policy I’ve taken, so thank you. GH.

Hi I have graded you C. Some feedback: Your macro level forecast based on our analysis has been spot on – well done
However, you created an impression (for me anyway) that resources will be resilient compared to banking/financial sector – this was incorrect.

We have been waiting for the gold bull for years yet after many years of patience, I find the stocks sitting at where they were a few years go – not good.

Moving forward, I suggest you make recommendations for 3 types of readers
Investors – those longer timeframe
Traders – shot timeframe
Leveraged – those with margin lending or other similar exposure (no point in holding a good stock as per you recommendations that is trending down and gets forced into a margin call)

I have lost money not because I lost my nerve but because when BHP came from a high of $50 to $20, I was forced to sell to meet margin calls. AR.

Grade D

I have to give you a "D" this year. This is mainly because I think you are not putting enough research and effort behind your BUY and SELL recommendations. This is why many recommendations are not working. Just relying on the charts and the annual reports and words of mouth is not enough. AN.

I think you completely misread the worldwide financial situation. While many also misread the situation, your service should be about being apart from the "many".

I would have appreciated a 'risk management' component to your advice... my sense is that your advice continued to be too 'bullish', particularly wrt resources when things were starting to unravel.

In fact, I think you should have been advising members to accumulate cash, rather than investing and that advice should have begun at least 12 months ago. I enjoy and value what you provide, but in light of what has happened I have to give you a D for 2008. PW.

You have requested my rating so I will provide it but first a quick summary of who I am. I manage our family DIY super fund, which is in the pension phase [and] I have limited personal investments. I subscribe to a number of advisory services including a charting service [and] I am a fairly conservative investor as should be so for superfund investments and so tend to invest only in shares in the ASX200.

I generally hold share investments for periods of 1 month to up to 4 years provided they don't lose more than 15-25% from their peak (this approach has not always protected me but has limited our losses) (whether it is 15% or nearer 25% depends on whether or not I have not been diligent or on the amount of accumulated gain in the share).

Based on our needs as outlined above I find that because Fat Profits keeps its HOLD recommendations for too long during share's price depreciation phases ie for me when a share (bought for capital gains) has clearly broken an upward trend it should be sold and not bought again until it is clearly in an upward trend.

Shares bought for dividends should also have strict 15-25% stop losses ie property trusts. So my grading for Fat Profits for its appropriateness for my needs would have to be "D". AM.

My calculations are that your 2008 recommendations are around 20% underwater. I appreciate that timing is the hard part and that some things were hard to forecast but you recommended some companies that soon after revealed some real weaknesses and many were obviously recommended in the expectation that the boom times on the market would continue.

This was a surprising position to take given your recommendation of resources and gold as protection from tough times ahead.

Charlie Munger says invert , always invert, and had you asked yourself what the price on some recommendations would be if certain events occurred then you would have not taken the punt .you wouldn’t want members to risk capital on anything but a very sure bet.

Curiously you have recently stopped making recommendations even though there must be less risk in some company prices than earlier in the year. It’s hard to rationalise that except as an emotional response to some nasty shocks at the fate of earlier recommendations. MF.

Hi, I give you a D. Why not brave enough to set some stop losses and some sell recommendations? Reliance on resources, China and gold are all very well but you must have more realism not idealism. Good call on the banks but you went against the market on almost everything else. BS.

Would be surprised if many rate you higher than that and I would expect many would go lower if your rating system allowed it.

The reasons for this rating are as follows:

1. Failure to take profits
It is staggering to note how many of your stock selections showed substantial profits over the journey only to see them reduced to almost nothing by not locking in a profit at some stage. They say selling is the hardest thing to do but that's where hard headed professionals like Fat Prophets need to step up. No one ever went broke taking a profit.

2. Failure to recognise the gold price wasn't flowing through to the companies
I think Fat Prophets was blinded by commodity prices and didn't take enough notice of the huge escalation in costs of the producers.

3. Lack of target prices I know FP isn't a fan of target prices but you would be the only analysts who aren't. A target price for what it's worth gives your subscribers a better idea of what you believe a company's true value is. It's still only an opinion but it's time you guys backed yourself in this area.

4. Timing. It's amazing how often your recommendations are followed by a sharp dip in the share price. This makes a mockery of your use of Technical Analysis to time the entry into a stock. I would be surprised if this hasn't caused considerably angst internally at FP over the years. No one has been spared in the current economic crisis, least of all Fat Prophets subscribers but I firmly believe you have failed your members in the above areas.

Having said all that, I do remain a committed subscriber as I have enjoyed considerable success with your recommendations over the years. TC.

It would be desirable if you also mark on your report stock charts all your recommendations (or at least your most recent ones) – not just initial buys. Eg, in May PDN Buy $6.18 (last $2.41); June SBM Buy $0.42 (last $0.235); Sept MUN Buy $0.23 (last $0.11); April BHP Buy $43.89 (last $28.45). The most recent recommendation is/should be where you think a stock is “at”, rather than a self-congratulatory pat on the back for getting something right some years ago in a rising resources market. CD.

Your call on the commodities is the worst thing that you could have done to your subscribers. Obviously at some point your team stopped doing the critical thinking and just copying what the majority are saying. SP.