There’s a man in France who owns what the Financial Times is calling a “magic ticket.” In their words: “It lets him turn back the clock, to invest with perfect hindsight week after week, steadily accumulating a fortune.”

Sounds like a sweet deal, no?

In 1987, Max-Hervé George’s father bought a life insurance contract from Aviva France. But this was no ordinary life insurance contract.

For some reason – which is still lost on me – the insurance company offered a contract that allows the purchaser to buy into any investment fund of his choosing, on Friday, but at the previous Friday’s prices.

Did you catch that?

He gets to pocket the investment returns… of last week’s top-performing fund… after the performance of all available funds is known.

“So you say Chinese stocks did the best last week? OK… I’ll buy those… at last week’s prices, please and thank you very much.”

Mr. George has reportedly exercised his contractual right with fervor, profiting from last week’s winners, week after week, earning an unimaginable 68% per year!

The story is truly remarkable. And if you think Mr. George’s deal is “too good to be true,” you’re more or less correct.

The insurance company offered these “magic ticket” contracts to a very small group of wealthy clients (who, back then, had to visit the broker in person). They have since bought out most of the contract holders. And they’re fighting Mr. George’s contract in court, since he (wisely) refused to sell it back to them.

Suffice it to say, YOU will NEVER be able to buy a “magic ticket” quite as nice as Mr. George’s.

But I think I’m on to the next best thing with the latest trading strategy I’ve developed…

For all the complexity in financial markets, your ultimate goal as an investor is actually quite simple:

• Invest in high-returning assets (typically called “risk assets”), but only when it’s worthwhile and safe to do so.
• Avoid risk assets when it’s NOT safe to own them.

To me, a market-timing model that tells you when to be IN risk assets… and when to be OUT of them… well, that’s the next best thing to Mr. George’s “magic ticket.”

And I believe I’ve developed a strategy that does just that.

Take a look at this chart…

(Click on image to enlarge)

It shows the annualized returns of a variety of risk assets – stocks markets, in general, but also highly volatile sectors, like biotech, along with junk bonds.

But these are not buy-and-hold returns.

Since my market-timing model very simply tells me when to be IN risk assets and when to be OUT… I can segment the performance of any market, according to the signal provided by my model.

In blue, you’ll see the annualized returns of each asset while my system says it’s SAFE to be in them.

In red, I’ve plotted the annualized returns generated while my system said it’s DANGEROUS to be in them.

Now, most investors intuitively understand that it’s no easy feat to “time” the market. And unless you have a magic ticket like Mr. George’s… no market-timing model will get it right all the time.

But getting it right most of the time, combined with good risk management, is more than enough to beat buy-and-hold returns and accumulate a considerable sum of money.

I’m sure you’ll agree that if you could capture, say, 80% of the returns during the “good” times… and avoid, say, 80% of the losses during the “bad” times… you’d stand to do quite well!