Just as surely as there will be an article entitled “Lose 10 lbs On 10 Minutes A Day” or “Easy Abs For You” on the cover of Men’s Health magazine this month, there will also be an in big letters “Six Stocks To Own Right Now” or “5 Mutual Funds To Protect Your Money” on the cover of one of the personal finance magazines this month. I guarantee it!
Why? Because “Low Cost Index Funds A Good Idea… Again” every month would get very stale and would stink at selling magazines! In addition, even the construction of the articles themselves is very predictable. It’s almost like they use a Mad Libs form (remember those?):
1. Give me the name of a recently successful mutual fund manager.
2. Give me the name of a formidable-sounding management company.
3. Throw out a mutual fund name, and its impressive recent track record.
4. Make a very vague but pleasant-sounding stock-picking strategy.
5. Give specific stock or mutual fund names, and corresponding stories that mesh well with said strategy.
6. Weave it all together into an article like so:
3 Bargain Stocks
Matthew Hughes may not look the part, but at the helm of BlackStone Partners, his BlackStone Carleton Value Fund (BSCVX) has outpeformed the S&P 500 by 10% annually in the last 6 years. The key, Hughes says, is to “purchase solid, long-term companies which have had recent short-term missteps. By taking the larger view, you can avoid getting distracted from the core fundamentals.”
Here are three stocks that the BlackStone Carleton Value Fund recently purchased:
FTH Holdings, Inc. – The largest oil tanker holding group on Latin America, FTH Holdings (FTH) has seen it’s stock price drop 20% recently due to management squabbles over whether to expand into oil exploration. However, it’s primary function of transporting oil between the Mid-east and South America remains solid, with earnings increasing an average of 28% a year for the last 5 consecutive years. Even with recent decreasing oil prices, demand remains high. “We don’t care about the price of oil – as long as people still consume it, we will make money transporting it”, CEO Arian Sanchez proudly states.
See? It’s easy to write a personal finance article. Don’t you want to buy some shares of FTH right now? Well, you can’t. In fact, you can’t even buy any of BSCVX. It’s closed to new investors. And old investors it turns out, as I just made all these names and stories up. But it sounded convincing, didn’t it?
By Jonathan Ping | Investing | 10/2/06, 11:23am