Tinsel-tongued prophets promise miracles that rarely materialize. Start your hunt for a tip sheet with the . . . TEN TOP NEWSLETTERS THAT SHINE OVER TIME

(MONEY Magazine) – Who could resist the alluring promises heard from the nation's 600 or so investment newsletters? ''Triple your investment in one year -- with nearly 100% complete safety,'' proclaims Douglas R. Casey, editor of Crisis Investing. Get in on ''a gain of 390,000% since 1980 with zero losses,'' trumpets Stephen Leeb, editor of the Big Picture. Or perhaps you'd rather put your faith in Adrian Day's Investment Analyst, written by ''the financial wizard . . . who's made more money for more people than anyone else in history.'' More money than anyone in history! Zowie! Where can we sign up?!? The only problem comes in trying to replicate any of those astonishing results in your own portfolio. Before you invest in a newsletter, consider how few stock- and mutual fund-picking publications actually beat the market year in and year out with their recommendations. The facts: The picks of only one in five newsletters have outpaced Standard & Poor's 500-stock index during any five- year period since 1985, according to Mark Hulbert, whose widely respected Hulbert Financial Digest ($135 a year; 703-683-5905) has tracked investment letters for the past dozen years. Despite such a prosaic performance, the appetite for investment newsletters is greater than at any time since the wild pre-crash days of 1987, thanks both to publishers' aggressive promotion tactics and to drooping savings rates, which have stoked demand for stocks and funds. Although no one has compiled authoritative data tracking trends in the estimated $100 million investment newsletter industry, anecdotal evidence suggests mushrooming interest. ''The market's been strong, both for subscriptions and new entries,'' says Steven Halpern, editor of the Dick Davis Digest ($140 a year; 800-654-1514), which follows some 450 newsletters monthly and excerpts notable passages. ''We know of at least 20 launches in the past six months, three times the usual number.'' One of the newest, Louis Rukeyser's Wall Street ($39.50 a year; 800-441-4783), edited by the punning pundit of PBS, already has lured 150,000 subscribers since its debut in March. But is there any reason for you to be among those shelling out the $100 to $300 a year that publishers usually charge for their letters? Yes -- assuming, that is, you choose wisely. Because the best of them, as Hulbert's list here of the top 10 shows, really can help boost your investment profits with their savvy stock and fund picks and model portfolios. Some additionally offer astute market-timing advice, directing you when to move into or out of stocks or funds for maximum profit. Still others are notable mainly for the necklace of incisive, moneymaking investment analyses their editors produce by threading together disparate beads of market information. Notes Edward Mathias, chairman of several T. Rowe Price small-company funds and a self- described newsletter junkie: ''Most newsletter advice has a contrarian flair that's invaluable for freshening your own strategies.'' But in today's crowded, constantly crowing marketplace, zeroing in on the sheet that's right for you is no easy task. That's why we've listed on pages 100 and 101 the five stock and five mutual fund newsletters whose investment recommendations have racked up the meatiest gains in the five years through the first quarter of 1992, according to Hulbert. To calculate the returns, he follows all of a newsletter's specific buy and sell recommendations on the day he receives the issue, debiting 1% for commissions. If a newsletter has several model portfolios, the ranking is based on an average of all results. ''My research shows that the newsletters that have turned in excellent performances over the past three to five years running,'' says Hulbert, ''are the most likely to lead the newsletter pack again in the future.'' While Hulbert's rankings are a reliable place to begin your search, don't stop there. You would be wise to look beyond his top 10 to find the one or two publications that will complement your investing goals and style and, further, will furnish you with analysis and perspective for a well-rounded market outlook. The following guidelines will help you choose -- and use -- the best newsletter for you.

-- Rely on impartial recommendations, not promotional claims. Never, ever forget that the investment newsletter business is essentially unregulated. Newsletter gurus are not required to register with the Securities and Exchange Commission unless they also manage money or provide investment advice to individual clients. If a newsletter's guiding light is SEC registered, you can be sure that the adviser has not been convicted of a securities-related crime -- but not a whole lot more. Says Dan Seiver, a registered investment adviser in Oxford, Ohio who has written the PAD System Report, a stock newsletter, since 1987: ''I could be a convicted ax murderer, and the SEC wouldn't stop me from publishing.'' As for promotional claims, the SEC mainly prohibits publishers from running testimonials from subscribers who maintain they have made megabucks from a newsletter's advice. But the agency does allow editors a kind of poetic license to thrill potential subscribers with performance puffery. Given the lax state of regulation, it's not surprising that some newsletter editors misrepresent their records or Hulbert's ratings to make their results seem more compelling than they really are. Says Hulbert: ''Some have confided privately to me that real results don't draw subscribers.'' One ploy is for an adviser to purge a losing model portfolio from his roster, or to report results only from time periods that show his stock-picking prowess in its best light. Other editors pass themselves off as top-rated by ignoring any newsletter that's done better. Case in point: Sheldon Jacobs, who edits the No-Load Fund Investor, has included in his promotional mailings since last summer a table showing his letter atop 17 other fund publications, according to Hulbert's ratings from 1988 through mid-1991. Actually, says Hulbert, Jacobs' letter finished 14th out of 31; Jacobs simply omitted the 13 competitors whose results topped his. Promotional copy that accompanies the table, says Jacobs, clarifies the pitch. ''We say, 'we outrate most,' which certainly suggests that we are not No. 1,'' he says. ''I feel very comfortable with my promotional material.'' Similarly, editor Jay Schabacker of Mutual Fund Investing put a bold headline on a recent advertisement claiming that his letter was ''Rated No. 1 by Hulbert.'' In smaller print was the qualifying phrase ''among the 25 best- known investment letters in America.'' In fact, the newsletter places a mediocre 11th out of the 17 fund letters Hulbert has tracked since 1986. Says Schabacker, who blames overzealous marketers for misrepresenting his results: ''My publisher has agreed never to do that again.'' The lesson in all this is absolutely clear: Caveat subscriber.

-- Try before you buy. All reputable publishers will send you a sample copy of their newsletter at no charge. Try several. In addition to a recent issue, ask for a letter from a specific date you pick six months or a year earlier so you can see how the adviser's recommendations panned out. Special deals are regularly available, and so are three- to six-month trial subscriptions, which generally cost $25 to $50. ''I take trial subscriptions exclusively,'' says Irene Moore, 53, who is active in a Portland, Ore. investment club. ''We use them to supplement our own research about stocks we're interested in.'' In addition to scanning our list of top performers, you can get a handle on which letters have been dispensing the most profitable advice lately by sending for a free sample copy of Hulbert's own eight-pager. Each monthly issue presents performance rankings for the model portfolios and asset- allocation advice of 139 of the most popular newsletters during the latest quarter, one-year, three-year and five-year periods. Investors who are interested primarily in market-timing advice might be better off scouring for candidates in a recent issue of Timer Digest ($225; 800-356-2527). Editor James Schmidt tracks more than 90 publications that provide timing advice, then reports every three weeks to subscribers on the results of the top 10.

-- Go for letters whose investing approach matches your own. Newsletters are far from a homogeneous group. Consider the striking differences between the five advisers ranked highest by Hulbert for their stock picks over the past five years. Top-rated MPT Review dazzles its 3,000 subscribers each month with 12 model portfolios plus a buy list containing 300 to 400 stock recommendations. Publisher Louis Navellier, 34, relies heavily on computer programs that screen for quantitative factors such as expanding profit margins and faster-than-average earnings growth. This approach usually leads him to tout one or two big companies -- most recently $10.9 billion (sales) Goodyear Tire and $1.6 billion Fruit of the Loom -- along with a slew of promising smaller issues. Result: a total gain, according to Hulbert, of 231.7% in the < five years to April 1, compared with 60% for the Wilshire index of 5,000 stocks. By contrast, runner-up BI Research highlights a mere handful of companies in each issue, mailed to 5,000 subscribers about every six weeks. Editor Tom Bishop, 41, favors special situations, particularly companies that may be positively affected by changes in government regulations. Example: The Environmental Protection Agency recently mandated that landfills must be lined to prevent seepage. Gundle Environmental, a recent Bishop pick, has a lock on the landfill-liner business. Since 1987, BI's picks are up 197%, according to Hulbert. Rounding out the top five is the Chartist, a Seal Beach, Calif. newsletter that owes its success (up 122.3%) as much to its market-timing advice as to its stock picks, and two specialized publications -- California Technology Stock Letter and Medical Technology Stock Letter, up 113.3% and 100.9% respectively. These letters are sound candidates for tech-oriented investors but clearly unsuitable for the blue-chip crowd. Mutual fund investors do not lack variety, either. There are the niche letters, like top-ranked Fidelity Monitor -- one of about five publications that focus exclusively on the offerings of a single fund family. In addition to providing model fund portfolios for income, growth and sector fund investors, editor Jack Bowers, 34, keeps readers abreast of news about the 131 funds in Fidelity's stable. Fourth-ranked Fundline has an even narrower focus: Fidelity's 33 Select funds, which invest in the stocks of a single industry. And just last year, Vanguard investors were able to get in on the newsletter action with the launch of Vanguard Adviser ($99; 800-835-2246), devoted exclusively to news and advice about the family's 57 no-load funds. Most of the 40-odd fund newsletters, however, take a broader perspective, recommending a diversified portfolio of funds from different investment companies. This approach gives investors much less of a roller-coaster ride than newsletters that concentrate on individual stocks, as a comparison of the relative-risk column in the tables on pages 100 and 101 indicates. But such a conservative strategy also leads to stodgy results: Even the No. 1 fund letter, with an 81.6% gain over the past five years, couldn't come close to the fifth-ranked stock letter's 100.9% return over the same period. Four of the five fund letters, though, did outperform the average equity fund, which returned 54.2%. Those results may not concern you unduly if you're interested in newsletters primarily to help sharpen your own investment thinking. If so, many newsletter aficionados suggest sampling the aforementioned Dick Davis Digest for its one- and two-paragraph snippets of wisdom and outlook from 450 advisory services. ''It's an excellent catalyst for ideas,'' says Atlanta broker Forrest Simmons.

Investors with a hankering for encyclopedic information and analysis to assist them in researching promising stocks might also explore the Value Line Investment Survey ($525 for one year; trial subscription: $55 for 10 issues; 800-634-3583). This weekly service, also found in the reference section of most libraries, provides historical data, projections and lengthy analyses for more than 1,700 stocks, along with a separate 12-page market outlook and advice letter. In the same way, the biweekly Morningstar Mutual Funds ($395 for one year; trial subscription: $55 for six issues; 800-876-5005) mimics Value Line's format to offer equally comprehensive write-ups and analyses of 1,240 funds. ''When you consider all the data in it, Morningstar's still cheap, especially if you are investing $20,000 or more,'' says Peter Schliemann, manager of Babson Enterprise, a $122 million small-cap fund.

-- Don't be a copycat. New subscribers often wonder whether they should sell all their current holdings and simply recreate a newsletter's model portfolio stock for stock or fund for fund. The answer is almost always no. Such an all- or-nothing approach could lead you to buy everything at a market peak or sell at a trough. You'd be far better off making any changes in your portfolio gradually, over a period of six months or so. The best strategy of all, however, is to edit a newsletter's specific picks and asset-allocation advice down to your own needs and goals. MPT Review's Navellier estimates, for instance, that fewer than 20% of his subscribers follow any of his 12 model portfolios exactly. ''Maybe 60% follow the models some of the time,'' he adds, ''and the hard-core independents simply pick apart my buy list.'' Too-slavish devotion to a newsletter's recommendations is particularly dangerous if the adviser offers a telephone hotline service, as more than half of the publications monitored by Hulbert do. Following hotline advice -- often updated weekly -- doesn't improve performance, Hulbert concluded after comparing the returns of letters with and without this service from the end of ; 1984 through mid-1990. He discovered that advisers with hotlines posted gains averaging around 10% a year, vs. about 11% for services without hotlines. Indeed, hotline advice may eventually hurt profits by encouraging too many transactions. Result: high trading costs, plus thunderous tax and record- keeping migraines. While the diversity of opinion gleaned from subscribing to several newsletters can be helpful, mixing and matching advisers' actual strategies rarely achieves the best results. Hulbert, for example, conducted a 3 1/2-year experiment in which he combined top-rated MPT Review's stock picks with the more accurate market-timing advice offered by the Mutual Fund Strategist, ranked second among fund letters. The theoretical gains were only about half what Navellier had achieved without trying to time the market so precisely. Concludes Hulbert: ''An adviser's approach to stock picking and his attitude toward market timing are part of a whole that cannot be profitably carved into component parts.'' One final caveat to consider before signing up for any newsletter: ''When you become a subscriber or start requesting sample copies, you receive -- um, let's just say many, many more promotions,'' says Bob Spengler, 50, a development officer at the University of Colorado Foundation who currently subscribes to two newsletters. So would-be subscribers should consider one additional investment that's sure to pay off: a large trash can to keep near your mailbox.


To find the adviser that best suits your needs, newsletter expert Mark Hulbert suggests ordering sample copies of several publications, then comparing them to see if: -- The letters' investment philosophies match your own. -- The gains on their recommendations have beaten the averages over time. -- The riskiness of their picks suits your temperament. -- Their advertising claims are borne out by their results.

CHART: NOT AVAILABLE CREDIT: Source: Hulbert Financial Digest CAPTION: THE LEADING LETTERS FOR STOCK PICKERS . . . The stock portfolios recommended by the five newsletters below scored the highest gains in the five years to April 1 among the 139 advisory ser vices tracked by the Hulbert Financial Digest. All five also far outstripped the market as measured by the Wilshire 5000, up 60%. But as shown by the relative- risk column, which sets the market's volatility at 1, four of them took & greater-than-average risks to achieve their profits.

CHART: NOT AVAILABLE CREDIT: Source: Hulbert Financial Digest CAPTION:. . . AND THE TOP CHOICES FOR FUND INVESTORS Mutual fund investment letters generally advocate a far less risky strategy than those touting individual stocks. They pay for that safety, how ever, with lower returns. All five top-performing fund letters underperformed the five leading stock letters, as judged by the model portfolios they recommended during the five-year period that ended April 1. But four of the five did outpace the average equity fund, which returned 54.2%.