I have read the term financial pornography many times on the Financial Web Ring forum, but I did not know what it meant. The Naked Investor, which I recently read, notes that mutual fund advertisements trumpeting previous year returns are a form of investment pornography. Columnist and advisor Paul Merriman writes:

We define “investment pornography” as misleading sales pitches meant to excite investors and goad them into enriching other people, contrary to their own best interests.

With the RRSP season fast approaching, it is a good time to remind ourselves to ignore ads that boast about recent performance or magazine stories that recommend “the ten stocks to buy now!”.