How to verify an investor's track record

Before you let anyone manage or mirror your money, the number to look at is not their return — it is how much of their record you can check yourself. Over the fifteen years to 2024, 89.5% of active US large-cap funds underperformed the S&P 500, so any given claim to beat the market is, on the base rate alone, more likely to be luck or selective presentation than durable skill. That does not mean skill is absent; it means a return figure carries almost no information until you can verify how it was produced. Six checks separate a record that is evidence from one that is a story, and they apply to a fund manager, an eToro Popular Investor, and me equally.

Why a return figure alone tells you nothing

A stated return describes an outcome you did not witness, over a window someone else chose, in an account you usually cannot see. Every common way of dressing up a record lives in exactly those gaps: the backtest shown as a result, the winners kept and the losers forgotten, the inception date nudged past a bad patch, the benchmark that appears only in the years it was beaten. None of these is necessarily dishonest — memory flatters everyone — but all of them turn an ordinary record into an impressive one, and all of them collapse under a complete, dated, benchmarked history. The checks below are just the specific places to look.

Check 1: Is it real money, or a model?

Ask whether the record comes from capital actually at risk, not a backtest or a demo account. A backtest is a hypothesis fitted to the past with full knowledge of what happened next; it has never once been wrong in real time because it never traded in real time. Live results, by contrast, were produced without knowing the ending. Only the second kind is evidence, and the distinction is usually disclosed if you look for the words "simulated", "hypothetical" or "backtested" in the small print.

Check 2: Is the whole history visible, or just the highlights?

Insist on every position and every trade, not a curated set of wins. The most common distortion is not a fabricated number — it is an omitted one. A record that shows the closed winners but not the open losers, or the good quarters but not the bad, is not a smaller version of the truth; it points the wrong way. A complete history is one where you can count the losing trades as easily as the winning ones.

Check 3: Is it benchmarked over the same period?

A return means nothing without the alternative you would otherwise have earned. "Up 40% over three years" sounds strong until you learn the S&P 500 was up more over the same three years. A credible record states its benchmark and the identical period, so the comparison is like-for-like — same start, same end, same currency. If the benchmark is missing, or quietly changes between periods, treat the number as unanchored.

Check 4: Does the start date move?

Check whether the record always begins at the same date, or at whatever point makes it look best. Cherry-picked inception is the quietest distortion: begin the clock just after a large loss and a mediocre record becomes a strong one. A trustworthy track record has one inception date that never changes, and reports every period since — including the parts the author would rather skip.

Check 5: Are the bad years in the record?

The fastest test of honesty is whether the worst period is shown at all. Any record that spans 2022 should contain 2022, the year the S&P 500 returned −18.1% and most portfolios fell hard. A record that includes its drawdowns, its worst month, and its response to them is far more informative than one that begins in 2023. What you are checking is not that the manager avoided losses — nobody does — but that they are not hiding them.

Check 6: Can you verify it without asking?

Finally, ask whether you can confirm all of the above yourself, right now, without requesting a document that could be edited before it reaches you. A screenshot can be cropped; a spreadsheet can be retyped; a PDF can be produced after the fact. A record held on a platform you can open independently — where the history is the platform's, not the author's to revise — is the only version that removes trust from the equation entirely.

Where this points, honestly

This is a demanding standard, and most records fail at least one check — which is the point. This portfolio is arranged to pass all six: real capital traded on eToro since August 2020, every trade visible and uneditable, benchmarked against the S&P 500 over the same period on the portfolio page, one fixed inception date, 2022 included in full, and all of it verifiable on the platform rather than asserted here. I set the test out this way knowing it applies to me too; a checklist you write to exempt yourself is just marketing. Run it on anyone — including any investor you might copy, and including me — and trust whatever survives it.

The base-rate reason these checks matter is set out in do active managers actually beat the index?, and the approach behind this particular record is in the investment philosophy.