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they were worth £340,000. So whereas in fifteen years they had done nothing, in those five years they had increased by 126%.

‘All this was being done longhand with pen and paper,’ he says, ‘which is fine, but I thought I was onto something here that could be of use to other people. And let’s face it, the so-called professionals haven’t exactly excelled themselves.’

So Chadwick recruited Richard Webb, who had been his sales director at The Furniture Factory, and David McCrea who had been technical director. Webb’s background was in science and technology, and he developed an algorithm that would automatically track fund performance. With McCrea managing the data, they had the core of a business, and thus was born The Salty Dog Investor, a DIY investment tool for those with the nous and the guts to manage their own portfolios.

The underlying ethos of Salty Dog was formed in the experience Douglas had had with Skandia, namely that the investor’s aim should always be to protect one’s money from

macroeconomic events or from funds that stop performing.

‘Imagine a horse race where you could switch your bets among the horses that were showing promise, and keep switching until the finish line. You’re bound to win. The way things work for investors now is just like putting your money on a horse at the start of the race, with no guarantee it won’t come in last.’


Salty Dog tracks 24,000 funds but distills them down into UK sterling denominated funds that, with a nod to his marine past, are categorised as:

Safe Haven – money market funds and cash

Slow Ahead – bond and gilt funds

Steady As She Goes– managed income funds

Full Steam Ahead – which is split into developed markets and emerging markets

The service offers data – but no advice – to subscribers who get weekly updates via the Salty Dog Investor web site.

So far, so good. But any amateur claiming the Emperor is wandering down Cheapside stark naked has to prove he can do better, so to test his claims Chadwick put £40,000 into a tracking portfolio, launched in November 2010. It has consistently outperformed the FTSE 100 and the mixed investment sector with an annual return of 7.73%. Richard Webb also tested it backwards three years from launch to see how it would have fared from the start of the financial crisis. The results held up.

Most convincingly, perhaps, Chadwick gave £26,000 to his son-in-law, a roofer by trade. He showed him how to use the system, and then let him get on with it. In the two years since, he has achieved close to 70% growth.

This sounds like a business that could go a long way, but at heart it feels more like a crusade. Membership of the service is £30 a month, but that will reduce to £20 when they break even. And when they‘re making money, Chadwick will channel 10% of profits into a charity to promote financial education in schools and for adults.

This old sea dog is a man on a mission. He may not have the industry quaking in its boots just yet, but what he is doing could end up changing the lives of a great many people.

For more, visit

The Salty

Dog DOUGLAS CHADWICK: In his own words

The personal finance industry has grown up over time as some God- rewarded enterprise that believes its own press. In the artificial world they created, the rewards are huge and are expressed in fancy City offices and salaries which no longer connect with performance. The industry prostitutes itself annually to take your ISA and pension money. It takes an initial commission and then comes back every year for more in the form of a trailing commission. The pain for you never stops just as the gain for them never stops.

Now for the real iniquity. The industry by and large advocates ‘passive’ investing. In other words you invest in a fund and then ride out the ups and downs of the markets, while your trusted advisor counts his commissions. The end result is more than £26 billion residing in funds that either make no profits or make losses. That’s your money. Have these people never played Snakes and Ladders? Don’t they know you move forward by spending more time on the ladder and less time on the snake? Then come the politicians, wringing their hands. Very sorry, everyone, but you are all living longer (as if it were a crime), so now you must work longer and then retire on a smaller pension. Oh and by the way you must take out insurance to cover your old age. None of them stands up and shouts, ‘Why not make the money that you do have work harder?’ I wonder why that might be?

My goal is to help investors break out of these shackles. How difficult can it be to make an investment judgement? It requires confidence, of course, some


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