| An Automated Process That Nudges Performance Higher |
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The Kelly Letter’s enhanced rebalancing guides you to buy stocks low and sell them high, through the power of price reaction alone. The farther stocks fall, the more the letter signals to buy. The higher they rise, the more the letter signals to sell. Repeated quarterly, this process nudges your performance higher to beat the market over time. See the plan in action in the current performance chart above.
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| A Longtime Subscriber Reports | |
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My compound annual growth rate (CAGR) on the letter is back to 23.5% since I began following the letter at its start years ago, helped by the great recovery from the 2022 crash. Keeping up with the CAGR helps me when the market is down and I can still see that it is not so bad after all. I don’t think it ever got much below 15% in 2022 — that ain’t bad either. My other portfolios rarely ever got above 15% CAGR and the letter never got below it. No matter the ups and downs, 23.5% CAGR is awfully damn good. Thanks!
John Prather
28 December 2023 50+ Years of Investing Experience |
Total Returns Compared
| 2019 | 2020 | 2021 | 2022 | 2023 | $10,000 Became |
CAGR | |
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| The Kelly Letter | 56.7% | 49.4% | 37.2% | -48.7% | 80.9% | 30,681 | 25.1% |
| Nasdaq Composite | 36.7% | 44.9% | 22.2% | -32.5% | 42.7% | 23,625 | 18.8% |
| S&P 500 | 31.5% | 18.4% | 28.7% | -18.1% | 24.9% | 20,727 | 15.7% |
| Eurekahedge Hedge Fund Index |
9.9% | 13.6% | 10.5% | -5.1% | 5.9% | 13,864 | 6.8% |
Hello and welcome! I’m Jason Kelly.
I wrote the bestselling Neatest Little Guide to Stock Market Investing and The 3% Signal, and spent years developing a rules-based approach to the stock market that reacts to quarterly price changes. If you’re looking for an easy-to-manage, high-performance strategy that enables you to spend less time worrying about your financial future, this is for you. Many members say they wish they’d heard of this years ago so they wouldn’t have wasted time and money following unreliable media tips. Let’s get systematic!
I Put Volatility to Work — Automatically
| My simple strategy uses just two funds, one for stocks and one for bonds, and sets a quarterly growth target for the stock fund. Once per calendar quarter, the plan looks at its stock fund to see if it has exceeded its growth target or fallen short of it, then reacts accordingly. Quarterly surpluses are sold and quarterly shortfalls are bought. Proceeds from sales go into the bond fund, and are used later to pay for stock-fund purchases. This process is shown on the chart to the right. → |
 Click here to see a larger image. |
Introduction to The Sig Systems
The Kelly Letter Runs Four Variations of The Signal (Sig) System
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Here’s How the Sig System Works |
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1. Check Prices |
Is your stock fund’s price above or below its quarterly growth target? If above, it’s a sell signal. If below, it’s a buy signal. |
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2. Generate Signals |
The quarterly growth target of the plans is 3% for 3Sig, 6% for 6Sig, and 9% for 9Sig (hence their names). You will sell stock-fund surpluses above these amounts, and buy shortfalls below these amounts. |
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3. Receive Orders |
Your spreadsheet (template on the subscriber site) or the easy calculator (also on the subscriber site) will tell you how many shares of your stock fund to sell or buy, and how many shares of your bond fund to buy or sell. |
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4. Place Orders |
If the signal is a stock-fund sell, you will move proceeds of the sale to your bond fund in the following order of events: sell shares of stock fund, buy shares of bond fund. If the signal is a stock-fund buy, you will generate buying power by selling shares of your bond fund, then use the proceeds to buy shares of your stock fund, in the following order of events: sell shares of bond fund, buy shares of stock fund. |
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5. Wrap Up |
When you’re finished, you will note the prices of this quarter’s calculations, including the fund closing prices used to generate your signals and the fill prices of your orders, for use three months later when the cycle repeats. |
There’s an Easier Way to Sync With the Letter
A spreadsheet or the subscriber-site calculator will generate precise signals for you, but an easier, close-enough-is-good-enough way of following the plans is to copy the letter’s new stock allocations after each set of signals. For this purpose, the subscriber-site calculator includes an “Allocator” tab. The following are its instructions:
| Here’s An Easy Way to Sync Your Plans With the Letter’s | |
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1. Go to The Kelly Letter Calculator |
 Click here to see a larger image. |
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2. Click the Allocator tab. |
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3. Enter the requested figures from your accounts. |
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4. In the “Desired Stock Fund Allocation (%)” field, enter the figure per plan. All of them are summarized in the letter. For example:  |
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You Won’t Be Alone
In addition to Sunday letters, email support, videos, a podcast, and occasional conference calls, you’ll enjoy access to the forums. Here, Kelly Letter readers gather to discuss ideas, and ask and answer questions. You’ll be pleasantly amazed by the thoughtfulness of your fellow members and the quality of these interactions. The forums are exclusive to subscribers. Start by introducing yourself, then fire off questions in our Newcomers forum, and we’ll make you a success.
Simple and Effective, The Kelly Letter Can Help You Stop Worrying About Your Financial Future
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Kent Lacey
Connecticut
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I have followed you, and your weekly letter for some years now. … When the markets tanked after the virus hit the US early this year, I was intently watching how your system would weather that investment method’s biggest test ever. Both you and your style of investing were just perfect during a time when many others were pulling their hair out. Nicely done.
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Vasco Gurch
La Mesa, California
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The Kelly Letter is the only investment newsletter needed for anyone who is interested in understanding how markets work. Not only does it provide excellent economic commentary and clear investing advice, it is also full of deep philosophical insights and provides great tools to learn and apply various lessons in life. I am thankful for being part of The Kelly Letter subscriber community and hope it continues to grow in popularity.
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Sign up for my free list to learn about the system. As a bonus, I’ll send you the famous first chapter of my book, The 3% Signal, “Why Markets Baffle Us.” |
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Chapter One: Why Markets Baffle Us
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$200/year
When you join The Kelly Letter, you’ll receive access to the step-by-step workings of the plan, all back issues and reports, and the member community in which your fellow members and Jason answer questions. There’s even a forum dedicated to newcomers, where you’ll feel right at home.
