Beating the Bear

Our panel of experts offers thebest strategiesto protect your wealth in today's market

They know their own personal situation better than anyone else. They know their own risk tolerance better than any one else. Education and participation should occur whether you’re going alone or you’re working with the most seasoned professional.

LAY: That’s why investment clubs have been such an attractive vehicle in the African American community. It’s a way to save and invest, but it has a lot of educational appeal as well. Once you start understanding what price/earnings multiples or duration of bonds mean, then you can equate it to [what it] means [for] you to buy a longer-term bond or [what it means when a ] stock is expensive relative to the marketplace. The only way you can understand it is by understanding the terms. Investment clubs have been an excellent way.

RAY: I think a lot of investors, especially novice investors, can take a look at everyday life [and realize] the stock market [and] bond market affects you, whether you realize it or not. When you get into your car, the company that makes that car is publicly traded. When you go to the supermarket, chances are the supermarket that you shop at is publicly traded. When you brush your teeth, chances are that consumer products company is publicly traded. When you buy a home, the 30-year fixed rate on your mortgage is going to be related to where rates are on the 30-year bond. The issue is your own personal perspective, what you take away from what you like and don’t like every day and you can translate that into some investments for you.

James Francis
Paradigm Asset Management

Stock (Exchange: Ticker)

Price at
Recommendation*

5-Year
Estimated
EPS Growth
Rate

Harley-Davidson (NYSE: HDI)

$49.49

18.5%

Home Depot (NYSE: HD)

48.46

20.6

TMP Worldwide (Nasdaq: TMPW)

49.58

35.8

*As of 8/10/01 Source: Zacks.comHarley-Davidson. “I like Harley-Davidson. It’s a company that would fall into the consumer cyclical area that is able to take advantage of growing trends for leisure. They have been able to attract the nonmotorcycle buyer with touring bikes and now they are in a position to extend their brand through a new performance line of motorcycles. I think the stock is poised to do very well in this environment and especially as we get even more confidence with the consumer.”

Home Depot. “We’ve continued to see strong home sales. I believe that there is an improved management team there at Home Depot now. I think that retail will be a strong leader in the rebound that we are all predicting going forward. I think that they are poised for the stock to go higher.”

TMP Worldwide. “This is a company that has its fingers in a lot of different areas. One of the undervalued components of the organization is Monster.com. They also experienced very effective cost-cutting measures and head-count reduction in the earlier part of the year, that I think puts them in a great position to enjoy earnings expansion.”

 

Lateef Rahimah
New York Life Investment Management

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