Friday, March 03, 2006

SuperFund - The Hazardous Waste Invesment

I am a subscriber to the magazine BusinessWeek and I really enjoy it, however I was shocked last week when I opened the covers to find a story about a new investment fund coming to America called SuperFund.

Now, most of you probably associate the term "Superfund" with the program run by the government to clean up hazardous waste sites across the country. However, over the coming months you will be coming to know about a new "Superfund", a hedge fund that is being rolled out to U.S. Investors that in time I believe will have more in common with hazardous waste then prudent investment management.

This new hedge fund is really not new, it has been around in Europe for a few years and is run by an Austrian by the name of Christian Baha, a true idiot. While he claims monster returns I wouldn't trust them. The first clue that Christian, is clueless comes when he states "Why shouldn't everyone be able to make above-average returns in any market?"

Why is this statement so incredibly stupid? For one thing it ignores the fact that if everyone earned above average returns everyone would be above average.........which is impossible. It is reminiscent of Lake Wobegon (Garrison Keillor) where "all the children are above average." The arrogance, stupidity, and naivity of Christian Baha is enough to give anyone pause, but if that weren't enough the fees to invest in his funds should be. In one fund you don't make a dime until the return hits 8.75%, then you only keep 75% of the returns after that, the other fund must hit nearly 11% before you begin making any money.

Mr. Baha is counting on two things to drive sales - Greed & Stature. He claims that his investment styles are only available to the rich, but he is bringing them to the masses. He is playing on people's innate desire to be "rich" or like the "rich". He advertises huge returns in order to draw you in, but don't be fooled, he is simply another charlatan. Same wolf, different sheeps clothing.

To be honest, I thought the BusinessWeek piece on Superfund was a parody. I thought to myself, if I wanted to make fun of some of the ridiculous schemes that are going on in American financial institutions I would create the SuperFund idea. What better name for a parody about a bad investment than Superfund, a term long associated with toxic waste? Alas, it is not a parody - you will see this advertised on T.V., newspapers, radio, and you may even see an investment bus advertising the fund.

Superfund is what it is, a toxic waste investment that should be avoided with serious money. Christian Baha does not deserve your money.

If you'd like a copy of the SuperFund story I can e-mail it to you.

Scott Dauenhauer, CFP, MSFP