Is Freeport Society Worth It? (I Just Tried It)

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I just tried out Freeport Society’s Freeport Investor Newsletter.

Is it worth it?

How have Freeport Investor’s stock recommendations performed so far?

Are there any better alternatives?

Freeport Investor Investment Strategy

Charles Lewis Sizemore is the chief investment strategist of Freeport Society.

Here’s a bit of his background.

He went to Texas Christian University in Fort Worth for his BBA in finance.

Later on, he got a Master of Science in Finance and Accounting from the London School of Economics.

He is a CFA (i.e. certified financial analyst).

Below is his working experience until 2018:

• Investment Advisor with Robertson Wealth Management
• Research analyst at Dent Research which is Harry Dent‘s financial newsletter publisher.
• Managing member at Sizemore Capital Management, a company that he registered in Peru in 2008

What is the investment strategy that Charles Sizemore uses to make investment recommendations to Freeport Investor subscribers?

He has five primary investment themes that he uses to find investment ideas that are deemed attractive:

• Freeport Foundation No. 1: Discovering the Dollar’s True Value
• Freeport Foundation No. 2: The Rich Man’s Currency
• Freeport Foundation No. 3: Parabolic Returns From Exponential Progress
• Freeport Foundation No. 4: Rebuilding the American Empire
• Freeport Foundation No. 5: Rejecting the ESG Cartel

Yes, I know it sounds unnecessarily deep.

Here’s my translation in layman’s terms:

• Assets that can protect you from the declining dollar and inflation (e.g., real estate, gold, and bitcoin)
• Buy high-quality businesses that can stand the test of time (think Coca-Cola, McDonald’s, etc)
• Invest in innovative technology (e.g., AI, Robotics, etc)
• Buy stocks that can benefit from manufacturing being relocated back to America (e.g., equipment manufacturers, advanced manufacturing, and industrial automation providers, etc)
• Invest in the oil & gas sector that has been shunned by ESG-conscious institutional money managers 

In particular, we are going to look at the 2nd investment theme because other themes are pretty self-explanatory and easy to invest via sector index ETFs (e.g., oil & gas index ETFs)

Charles Sizemore’s selection criteria for high-quality businesses are as follows:

• Durable competitive advantage
• Outstanding brand name
• The largest business in its industry
• Sells everyday products
• Sells habit-forming, addictive products (e.g., cigarettes, alcohol, chocolate, digital addiction, etc)

I agree that owning a high-quality business that generates consistent cash flow and can pass the rising cost to consumers by raising prices is a brilliant strategy for preserving your buying power and growing your wealth.

That’s how Warren Buffett grows his wealth.

The key is to identify these high-quality businesses and hold onto them for the long term.

If you are a passive investor and don’t have time to choose stocks and monitor your investments, then S&P 500 index ETFs are the safest.

This is actually what Warren Buffett recommended to regular investors.

But if you are an active investor and want to pick individual stocks to outperform the market, then identifying these high-quality businesses is key.

Identifying them is only the first step.

You don’t want to buy these stocks at a lousy price (i.e., overvalued price)

The most important thing is to Never Overpay A Stock. 

I think one of the best ways to make money safely is to buy good companies when their stock prices are beaten down.

Freeport Investor Stock Picks & Performance

Freeport Investor only started its model portfolio together with its stock recommendation around Dec 19, 2023.

As the stock market has been staging a strong rally since the beginning of 2023 and continuing to make new all-time highs until the end of February 2024, you can see that 18 out of its 22 portfolio holdings are profitable, while 4 are losing money.

One of the most obvious investment recommendations is Bitcoin.

Bitcoin’s price has almost tripled since its 2022 low.

Since Freeport Investor’s recommendation in Dec 2023, Bitcoin’s price has gone up by more than 40%.

Can it continue to go up to $100,000 or even more?

It’s possible.

History has shown that asset prices could skyrocket to unbelievably high levels when there is a lot of irrational exuberance.

Can it crash by 50% or more in the future?

It’s also possible.

Bitcoin prices have fallen by more than 50% several times in the past.

With the introduction of Bitcoin ETFs, more retail investors are jumping in and pushing the prices higher and higher.

When there are a lot of speculative trading activities, a small number of people could get rich and most people could get burned.

I stay away from Bitcoin because I don’t believe in it.

Gold is another popular way of hedging against inflation and also from market crashes.

According to Ray Dalio, Bridgewater Founder, he prefers to allocate a small percentage (i.e., 7.5%) of the All-Weather portfolio to gold.

Personally, I don’t invest in gold, not because gold didn’t appreciate over time (in fact, gold did appreciate over time), but because stocks of good businesses performed so much better over time than gold.

Also, one thing I don’t like about Freeport Investor is that it also recommends a stop loss for its stock recommendations.

Charles Sizemore mentioned that the reason for the stop-loss is to help members exit the market when the market falls so that they can get back into these stocks at a better price.

I don’t get it.

Isn’t this supposed to be investing, not market timing (i.e., trading)?

Nobody can pick market bottoms.

Peter Lynch said, “Far more money has been lost by investors in preparing for corrections, or anticipating corrections, than has been lost in the corrections themselves.”

Warren Buffet didn’t make his billions by buying high-quality businesses and then selling them when the market fell and then hoping to buy them back again at a better price.

There are many platforms where you can go to find potential high-quality businesses, such as Seeking Alpha, Morningstar, and Stock Rover.

Freeport Investor Pricing

How much does Freeport Investor cost?

It costs $149 a year.

But, it is just $49 for new subscribers for the first year, then automatically renewed at $149 a year.

As a paid member, you have the following:

• 12-month access to the Freeport Investor monthly newsletter
• Trade alerts and recommendation updates
• Special reports (e.g., The Rich Man’s Super Currency, Discovering the Dollar’s True Value, etc)
• Model Portfolio

Is it worth it?

It’s quite cheap for the first year.

But, I think there are other better alternatives if you are an active investor.

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