The Investors Next Door

Trying to figure out the best movesin today's market? Listen to the strategies from members of some of the nation's leading investment clubs.

put [the money] back into the club.

GREER: We evaluate our investment philosophy, which is long-term, but we also want to make sure that we have diversity in the equity markets in regard to large-, mid-, and small-cap [stocks]. So we review the portfolio quarterly and see if we need to get rid of one company or another.

B.E.: At this point, how does your individual portfolio differ or match your investment club’s portfolio?

GREER: Well, mine differs in that stock that the club is not necessarily interested in–like [The] Men’s Wearhouse (NYSE: MW)–I would have in my portfolio. You’re able to review your portfolio on a regular basis [and] just buy what you want. [However,] I know in a number of cases, I’ve had companies and [my club members have] said, “Why didn’t you share that with us?”

GRAIN: Essentially, my personal portfolio has some of the stocks that are in our club portfolio, but since I’m the aggressive one in the club, I’ve taken my aggression out on my personal stocks. [My personal portfolio has] actually done pretty well. I have the advantage of being able to buy, sell, and review if I wanted to on a daily basis, but at least a weekly basis, to re-balance and so forth. It has been a nice experience to have the freedom and still make money.

RAMSEY: I’m a little more aggressive outside of the club. My wife and I got into a couple of mutual funds, some individual stocks, and IRAs to help build our personal portfolio. It definitely doesn’t mirror [the club’s holdings]. We just try to put money where we think it will add value and maintain a pretty good cash flow as well.

JOHNSON: I set aside a small amount of my personal portfolio for more aggressive things. I [have invested in] things like eBay (Nasdaq: EBAY), which was interesting [and] didn’t have the long history that the club would have been comfortable with.

B.E.: Do you believe President Bush’s handling of the current accounting scandals has either hurt or helped investor confidence and the economy overall?
RAMSEY: I think Bush’s handling of [the scandals] has not had an impact or a somewhat negative impact. I think part of the issue is that people don’t trust him. [He] can’t even get [his] story straight as to his own personal issues with accounting and explain that in a way that the American people can understand and accept [as] the truth. When you’re saying you’re going to get tough on these companies, how are we to believe that when that’s your history?

B.E.: Early on, each time Bush spoke on TV about this, the market went down.

JOHNSON: That’s not a good sign. What I’ve seen from both investor confidence and consumer confidence is the response to Alan Greenspan. He’s been maybe more instrumental in calming things down and trying to get everybody on an even keel.

GREER: Investors are cautious and wary. In regard to Greenspan, they see him saying that we are recovering but they see

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