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Perfect 10 investing

Perfect 10 magazine

Over on the far right of the bell curve are women with perfect curves and uniquely beautiful faces.

This was the founding premise of Perfect 10, a magazine focused on the most attractive females around.

Perfect 10s are rare. According to the standards of glamour photography – entirely aesthetic and youth-obsessed – almost no women are Perfect 10s.

  • Age alone rules out nearly anyone over 25 or under 18.
  • Of the 10% of women left, most would be considered overweight.
  • We’re down then to a pool of perhaps 2% of the female population before we’ve even considered their winning smiles, breasts, or acne.
  • The magazine actually found many of its beauties in Eastern Europe.

I’d even question whether the Perfect 10 dream is all that?

This isn’t the place to judge the morality of objectifying female beauty (for the record, I think it is objectify-able, but I’m completely clear about the consequences that women have to live with).

Rather, I’d suggest that even if most Perfect 10 readers could snag themselves one of these rare creatures, they’d find living with her a trial.

From experience (cough cough) I can confirm that dating a very beautiful young woman entails a weird combination of fending off endless advances, while dealing with her often chronic insecurity.

There’s more to life – and to women – than that.

More dangerous daydreams

Here are some other Perfect 10 fantasies that flounder on mathematical reality:

  • Writing a best-selling novel
  • Setting up a world-conquering business
  • Playing for Manchester United or the New York Yankees
  • Become bigger than The Beatles
  • Stumbling across the next Warren Buffett

You can easily spend your teens and 20s pursuing such improbable goals. But as my father used to quote, “Don’t let the enemy of the good be the best”.

It’s great for society – vital – that some people won’t settle for anything less than their dreams. Maybe it’s even best to follow your heart where it takes you, if you truly must.

But for most of us, it’s statistically clear the dream will end in failure.

What about Warren Buffett?

If I told you to dump your girlfriend or wife because she’s not Perfect 10 material, you’d laugh in my face.

If I told you to ditch your boyfriend or husband because he couldn’t bench press a Fiat 500 or pass for Ryan Gosling if you squint hard, you’d snicker.

Yet instead of following the market via an index tracker, most investors do the equivalent when investing.

Instead of accepting realistic returns from a tracker, we pick stocks or buy funds because we dream we’ll either be the next Warren Buffett or else we’ll find his successor.

Stock picking

This is largely a fantasy. Statistics have repeatedly shown most stock pickers don’t beat the market over a period of years, whether they’re amateurs or professionals.

Finding the next Buffett

Even less likely. Most funds fail to beat the market.

Also remember Warren was basically running a friends and family hedge fund when he set out. Your chances of turning $1,000 into nearly $3 million over 43 years by backing the next Warren Buffett are approximately zero.

Over shorter time periods, the chances of picking a manager who beats the market are still less than 5%, even before costs, as this 2008 letter to the FT (found via The Munro Fund) demonstrates:

Sir, In his piece “Trackers are crackers” (Money, December 13/14) Jason Britton asserts that while it would have been very hard to pick one of the nine (out of 177) actively managed funds that have outperformed the FTSE All-Share since March 2000, one would have had a “much better chance” of selecting one of the 89 (out of 177) that outperformed from March 2000 to March 2003; one of the 78 (out of 236) that outperformed from March 2003 to July 2007; and one of the 71 (out of 317) that have outperformed from July 2007 to November 2008.

So the overall chance of me achieving a return consistently above the FTSE All-Share during the whole period by picking “successful” active fund managers from this pool?

A shade over 3.5 per cent – not quite the “much better” I was hoping for.

Colin Barrett,

Using charts and graphs

As I mentioned the other day in my article about bear market rally chartists, academics have again failed to find one single technical signal that consistently leads to profitable results in developed markets.

Choose Credible 7 investing

If you’re a morally dubious male, you might marry a Credible 7, then try to seduce 10s on the side.

Or maybe you’ll stay single and ‘unsullied’ by a less-than-perfect partner, and instead get older looking to pick up beauties who will only get older, too.

Neither approach seems particularly sustainable to me, but this isn’t the writing for that.

Rather, I’d like to stress that when investing we have better choices.

  • We can back trackers, diversify across an ETF portfolio, and achieve better results than most people by simply aiming for average market returns. (Regular, adequate saving and average returns from stocks are the secrets to later prosperity, not stock picking.)
  • Alternatively, we can put say 75% of our money into trackers, and allocate a side portfolio into individual shares or funds. We’ll probably end up poorer than going all tracker, but we keep alive the fantasy of finding that Perfect 10 result without totally derailing our financial futures.

The second option is something like my own strategy.

I usually avoid funds, which are nearly always crippled by costs, but I can’t resist dreaming I might beat the market with my stock picks, any more than I can avoid sneaking a peek at some lissome beauty in the street.

Most of my long-term money though is in tracker funds and ETFs, where I know what I’m getting. For most people, ‘all’ would be the most appropriate allocation.

The world of chasing endless beauty queens in the absence of all other kinds of women or relationships isn’t for me.

And nor can I recommend Perfect 10 investing.

Postscript: Perfect 10 magazine is no longer on the shelves – though it lives on in the Perfect 10 website. I guess the reality of paper publishing in the Internet era caught up. Will reality catch up with Perfect 10 investors? Don’t hold your breath. I notice the website mentions a dating service touting potential dinner with a Perfect 10 model. Men are wired to believe they’re above average.

{ 3 comments… add one }
  • 1 Financial Samurai November 3, 2009, 5:29 am

    Gotta love it. I only date girls who are perfect 10 investors. It’s the only way to get rich! 🙂

  • 2 FB @ FabulouslyBroke.com November 3, 2009, 9:54 pm


    A perfect post.

    No woman is a perfect 10, and the younger we learn it, the better, so we can grow up and get on with our lives instead of spending it stuck in limbo, obsessing about looks that will eventually fade.

    I learned early on that being pretty is a nice bonus, but I’d rather be known as being intelligent with a great big personality.

    The girls who had the best personalities, no matter what they looked like, always had people admiring them.

    And some beauties were ugly on the inside! Ick.

  • 3 Rob Bennett November 6, 2009, 4:19 pm

    I hate the magazine concept. It’s beyond dumb. It’s super-energized dumb.

    I also don’t think too much of the idea that because we cannot all become Warren Buffetts that we should not make an effort to become better investors than we are today.

    If we applied the Passive Investing concept to our search for a life partner, we would say “there’s no purpose in trying to find a suitable match, I should just marry the first person who happens to cross my path — that’s what “the market” says is right for me!”

    I say “no.” The market is us. To the extent we all strive to be Warren Buffetts, we make the market smarter than it would be if we all investing passively. It’s our intelligence that makes things go right and it’s our unwillingness to apply our intelligence (in the event that we throw our hands up in the air because we don’t think we can match Buffett) that can make things go very wrong.

    My wife is not a perfect “10.” Not by the moronic standards of that idiotic and insulting magazine. My wife is a perfect “10” because of what I have seen in her during that path we have travelled together, something that I could not see in the woman pictured on the cover of that magazine even if I personally found her even a little bit attractive (I do not, but that does not mean that there is anything wrong with her other than that she just is not even a little bit my type).

    I’ll never be a Perfect 10 investor. But I learn something new about investing just about every day. I feel zero interest in investing passively today. It’s because I rejected the Passive approach about seven years ago that I am a lot closer to Warren Buffett status today than I have any right to be given how short of him I fall in the I.Q. department.

    The idea is to strive to be the best life partner you can possibly be and to strive to be the best investor you can possibly be. Saying “I can’t be Warren Buffett, so I will stop trying to learn” is a cop-out, in my assessment.


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