Top 10 Worst Investments of 2011

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OK, time to have a little fun.

It’s not quite the end of the year yet so who knows, maybe some of these will have a “miraculous recovery” in the next few weeks (cough, cough, I doubt it, cough), but as December gets underway and we quickly approach the end of the year, it’s time to bring out all of those famous “Top Lists” for the year just passed (and predictions for the year to come!).

So without further ado, I present you with Kung Fu Girl’s Top Ten Worst Investments of 2011:

10. Your mattress

Honestly, after looking at the alternatives below I really couldn’t blame you for just wanting to put it all under your mattress! But with John Williams estimating “real” inflation at 7% (based on how they calculated it in the 1990′s) and over 10% (based on how they calculated it in the ’80′s), you’d be down 7-10% for the year had you chosen this option.

9. Any bank “savings” account…

With savings accounts paying less than 1% interest and CD’s not much more, it’s been a rough, tough year for savers…only slightly better than the mattress option!

8. Your house

Thanks to the subprime mortgage crisis people around the world have now realized that in fact, as Robert Kiyosaki was always so fond of telling us… your home is truly not an asset. Which sucks. But according to Case-Shiller’s November 29th Press Release, home prices are back to their first quarter of 2003 levels. Ouch.

7. The S&P 500

Just buying the S&P 500 index this year would have netted you exactly…nothing. As of the closing bell yesterday it’s exactly flat on the year (and when you factor in inflation, “flat” = “down”…). It closed at 1257.64 on Dec 31,2010 and closed at 1257.08 yesterday.

6. The Japanese Nikkei 225

Then there was Japan… Japan had a rough year (actually they have had a rough two “lost” decades). As Kung Fu Guy is Japanese, I have a special place in my heart for the people of Japan. Still, I am happy I didn’t put any money into the Nikkei this year…

Japan's Nikkei Index, down almost 15% this year

But it gets worse…you could have been a big-wig and invested in…

5. John Paulson’s Advantage LP or Advantage Plus hedge funds

Paulson made billions on the subprime crisis and by betting on gold…but this year he sold a bunch of gold and betted on a big “U.S. Recovery” that sadly has yet to materialize (wouldn’t we all like that to happen though!). His Advantage LP fund is down approximately 32% this year, and his riskier “Advantage Plus” fund is down a whopping 47%.

4. Bank of America stock

BAC closed out 2010 at $13.34, and yesterday closed at $5.79…you would have lost over half of your money invested in this stock year to date!

3. Netflix

Netflix got hammered this year (and yes, I realize that unless you live under a rock you probably already know this…) but I mean really hammered:

It closed December 31 last year at 175.70, and closed yesterday at…$70.12. Ouch!

2. Greek bonds

At a 33% yield for the 10-year bond this may at first seem like a brilliant idea—who wouldn’t love 33%? However, this must be filed in the “if it sounds too good to be true it probably is” category…darn.

1. Anything Whitney Tilson buys/recommends

This Harvard MBA hedge fund manager is a regular whipping-boy on ZeroHedge (but deservedly so…). Just yesterday the Anti-Tilson “fund” hit all time high +60%…And it’s up 55% since its inception just a few short months ago! That means Whitney himself is down by that same amount….another big ouch!

So there you have it, my top ten worst investment ideas for 2011…did I miss anything? Please let me know your top picks on the blog…

I hope you all are enjoying your December and getting ready for the holidays and New Year with lots of humor and fun! Thanks for reading and being a part of our Kung Fu Finance community!

To your financial success,

—Kung Fu Girl

Tagged as: BAC, gold, John Paulson, mattress, NFLX, top ten, Whitney Tilson

About the Author:

Susan Fujii, aka kungfugirl, is an SEC Accredited Investor who believes that anyone can learn to be financially independent.

Susan has authored 199 posts on Kung Fu Finance, and you can connect with her on Google+.

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