Dear Fellow Share Market Investor,
We had many, many emails yesterday, some keen, some curious and some downright sceptical of our offer of Two Can't Lose Stocks on Sunday April 1st.
There was another group though…Those who wondered if the date might have had something to do with it…
Yes, as many of you realised, yesterday's email was sent on April 1st. Given our name – and last year's offer of shares in Kollymagnus – it was only fitting that we join in the April Fool's merriment again this year.
The Motley Fool has a proud history of April Fool's Day pranks – going back to our very early days when we only operated in the United States. If you feel like another giggle, you might want to have a look at yesterday's announcement of The Motley Fool's plans for an IPO.
If it seems too good to be true…
Back in Australia, I'm sorry to say there really is no Private Order Non-Zoned Investment scheme. You'll notice something familiar about the initials of that scheme though – they spell Ponzi.
For those of you who aren't familiar, Charles Ponzi lent his name to an unethical – and illegal – pyramid scheme, not unlike the recent fraud perpetrated by US financier (or should we say scammer) Bernie Madoff.
We had hundreds of emails yesterday, which broadly fell into a few categories.
- Many people realised outright that our offer, which really was too good to be true, couldn't possibly be real.
- For some of you, we were flattered that you were prepared to trust us, even though you had your doubts about our proposal.
- For others, you were simply curious enough to want more information. There's nothing wrong with a healthy curiosity.
- A few of you were angry that we'd promote such an unscrupulous and unethical proposal.
A selection of replies is included at the end of this story, for your education and amusement.
…it almost always is!
This scheme – which would be totally and completely illegal by the way – isn't real.
Nor are promises – no matter who you receive them from – of 'can't lose' investments. We pride ourselves on our ethical approach to what we do (our disclosure policy is here), but you should always have a questioning mind when presented with these types of offers.
Expert opinions, particularly from those you've never heard of, such as our own (fictional) Ludwig Llewellyn, should be treated with caution. Like the Ponzi reference you might also have noticed something fishy about Ludwig's quotes:
"A particularly rare investment lark" and "found out of luck". (hint: check the first letters again).
When you're offered such 'guaranteed' returns – via email, chatrooms or hot tips from friends, our advice is simple – run the other way!
It takes time
Get rich quick schemes are seductive. But like the mythical sirens of Greek mythology, the beautiful sounds will likely just leave you financially shipwrecked.
We only know one way to get rich (excluding a lottery win or creating your own stupendously popular social network) – and that's slowly. Don't despair though – it's better than staying poor slowly!
It's been said that lotteries are a tax on the stupid. That's a bit harsh, but the odds are well and truly – horrendously – against you. The same risk/reward confronts you when you try to get rich quick in investing.
The exception proves the rule
Sure, you hear about the occasional winner – Fortescue Metals comes to mind – but those of you who remember the mining boom of 1969 will recall another miner – Poseidon – for every winner, there are many losers.
It's great that Usain Bolt can run 100m in less than 10 seconds, but you wouldn't extrapolate that to assume that every other athlete was therefore likely to be able to do the same…
It's the exception that proves the rule, but often we fall victim to believing that the perception actually creates a new rule. It's almost never the case.
'I can't find them on the ASX'
You might be wondering about the two little miners we featured.
Unfortunately both are as fictitious as our mining specialist – and their names (and ASX codes) were taken from two of the most famous (and destructive) bubbles in financial history – the South Sea Company bubble and the Tulip Bulb mania.
And of course, the number of expressions of interest we were able to take – 1,412 – shared an uncanny resemblance to yesterday's date.
Authorised by Bernie Madoff
We hope that those of you who realised we were pulling your leg also read as far as our 'fine print' at the end, where we promised no billionaires were harmed in the writing of our offer, and that it had been authorised by Bernie Madoff – and our tongue-in-cheek plea to Reserve Bank Governor Glenn Stevens to cut our interest rates to zero.
We apologise to those of you who thought we were serious – both those who were already putting the champagne on ice, and to the few who were outraged at what they saw as unethical and disappointing behaviour.
We're sorry for misleading you, and hope you can have a bit of a laugh with us.
To that latter group in particular though, we say thank you, and more importantly, maintain the rage! Hopefully not at us (we're sorry – honest!), but at those who are doing these things for real.
Don't believe the hype
Sure, no-one is blatantly offering the opportunity to join a pyramid scheme, but there are many who will promise you untold riches with exciting headlines and unbalanced sales pitches.
Don't put up with it – and don't fall prey.
Our annual joke aside, we're glad to resume normal programming today. We're getting back to what we do best – helping Australians invest. Better.
We want to find great investing ideas, and help our fellow Fools become better investors.
Back to finding great investing ideas
Yesterday's joke was a bit of fun, but the lessons are quite serious.
We're leaving unrealistic promises and unscrupulous practices in our April Fool's gag, and returning to the real world. For all of us who aren't Richard Branson or Andrew 'Twiggy' Forrest, we think there are only two options – to get rich slowly or not get rich at all.
The world where company fundamentals matter, and the price you pay for your shares is a really important part of your investment returns and where the tortoise can genuinely (and reliably) expect to beat the hare.
Thanks again for joining in a little April Fool's fun. We hope we gave you a laugh (either yesterday or as you read this), and appreciate your support.
Until next time…
The Team at Motley Fool Australia
The prank: Two 'can't lose' stocks… Your urgent attention is required
Last year's joke: One hot stock you simply can't ignore
Last year's confession: One hot stock you simply had to ignore
Some of this year's feedback:
Ha ha…….April Fooled!!
Nice one 🙂
Very good, Foolish ones.
Welcome to the first of April!!!
As a keen Motley Fool reader and Share Advisor subscriber, I have no choice but to convince myself NOT to participate in such a wonderful investment scheme.
Happy April Fools' Day and keep up the good work !
This is April Fool Right?
An even more enjoyable read than your usual newsletter!
I love it that you guys give great tips that pay off, but also have such a GREAT sense of humour.
I was well aware of the date, but I'll bet you caught plenty.
Keep up the good work!
Not sure if this is a joke, as it is said if it sounds too good it normally is…
April Fool joke I assume(hope).
April "Motley" Fool!!
Sounds like a great plan.
Count me in.
PS – remind me to tell you about the plan I am working on to sell sand in Qatar….
Touché, absolutely sucked me in..
Albeit vary warily, took me a while to realise the date!!
Will accept the fool's (small "F") dunce cap on that one.
Another valuable lesson taught & learned:):)
should have clicked
Boys this sounds a lot like an April Fools joke. Pyramid scheme at its best.
Hahaha, well done Fools… as a very satisfied follower I couldn't believe what I was reading! Cheers
I was about to fire off an e-complaint to ASIC re this clear pyramid
scheme. Then I saw the ASX ticker codes IOU and BULB. Good one !!!
This better be an April Fools joke. 🙂
I thought you guys had lost either your a) wits, or b) ethics until I realised that it is April 1st. I'm old enough to remember Poseidon.
Not sure if it's too late now, but I want in. I will forward this onto as many friends as possible.
Please let me know what we do from here on in.
I've been fooled?????????????????
I didn't even get to the disclaimer!!!! You bastards! I love you more than ever!
I am interested. However, because the two companies you mentioned are not actually listed on the ASX I would like some clarification.
Bring it on team. Your advice is always insightful and a decent read. I want in! By the way I sincerely hope it isn't an April fools joke! 😉
Thanks for the offer. When should I forward to my contacts?
I am interested and have forwarded this information on to 20 friends.
Just emailing that I want in and I will ask 20 of my friends and ask them to ask 20 of their friends!
Good Morning Fools,
Thank you for such an excellent opportunity. I couldn't help but notice the date we received this email and the fact that it is a PONZI scheme. Thanks for putting a smile on my face first thing on a Sunday.