heavy real estate component. Some of that is just the nature of the beast, sort of what I feel comfortable with.
The equities I have are names that you would recognize and, since I have a history as it relates to a career, a lot of the places I have worked.
Then, I have a very heavy concentration on the fixed income side which is, of course, natural because that’s what I do every day.
I don’t know how fair that is to recommend for other folks. I will just say that I feel as though I’m probably a pretty good contrary indicator on the equity side.
EWING: Invest, don’t speculate. That means, for most people, being smart in looking at mutual funds, and if you don’t know which ones to get because there are thousands of them out there, there are places you can get that help.
I would say to people who maybe have a few mutual funds out there, be they bond funds, be they equity funds, don’t let the current market events change your prudent philosophy. If someone calls you up and they say, “Hey, Mike told me to buy that great Qualcomm, and I got in when Mike told me to, which is very low, and I’m doing great.&qu
ot; Hey, that’s great but, it’s okay that someone else got 200% and you got 7%. It’s okay that someone else got 1,250% and you got 6%. In the long run, you have got to really look at risk-adjusted return. I think a lot of retail investors are just not aware of what [the risks] are. So, for those people building a nest egg, continue to do the same things that have made you successful. If you’re out there and you try to build a nest egg and it hasn’t been successful, then take a step back and just do it conservatively.
I think that for the retail investor, if you’re going to buy one stock and say this stock is going to work for me, that’s not investing. That’s doing it because you like doing it and it’s fun. I do it. You guys probably do it. But we do it probably because there is some enjoyment that we get out of it, not that we’re building our family’s futures on one or two of these names because it’s a loser’s game every time.
DIAMOND: I would support what Mike said and what Russ has said. I would only add that new entrants into the market should be reminded that if one accepts the premise that returns are mean reverting, that [means] these last few years of 20%+ returns might be met with some down years to reach Ibbotson’s average of 10% long-term returns.
(Note: for other excerpts from the black enterprise Investment Roundtable, go to www .blackenterprise.com.)
MANNS’ STOCK PICKS
Cardinal Health, based in Dublin, Ohio, is a provider of pharmaceutical distribution services and products to independent and chain drugstores, hospitals and alternate-care centers. Manns says Cardinal derives a significant amount of its profit