Thursday, October 13, 2005


Is there anybody out there who wants to know anything beyond Wall Street? I doubt it. There are actually some challenging happenings beyond that famous street, and Foster's the man who's going to tell you all about it. There are the stories from the mouths of those strategists who have ventured into that dark lane where wealth abounds, made it and return to tell the whole world what they have learned.

UNDER THE current stock market circumstances it might not be such a bad
idea to take this book home and read it religiously. Even though Wall
Street, by name, belongs to the United States, the money game played in
this famous street can be mastered and learned by those of us who by habit
desire to know more about a subject upon which we have devoted so much
time and money.
Beyond Wall Street showcases the stories and lessons from the classrooms
of eight investment strategists who have successfully carved a niche in
the market for themselves. Theirs are lives that others strive to emulate.
To use a cliche, many have tried, many still trying, but only a chosen few
have succeeded in locating the motherlode as mapped out by the various
In Chapter One, Foster Friess, the man who founded Brandywine Fund in
1985, proclaims his three cardinal rules in investment:
1. Never invest in the stock market; invest in individual companies.
2. Once you own a stock, never look where it has been; look only where
it is going.
3. If it is not going faster and farther than an alternative, sell it
and buy the alternative.
In case there are doubting Thomases around, Friess knows what he is
talking about. His company's performance speaks volumes. Brandywine has
managed an astonishing 560.4 per cent return on investment since its
Friess is a straight-to-the-point believer in grabbing the bull by the
horns. To people like him, momentum is paramount. In a blink of an eye,
you could lose your pants, figuratively speaking, of course.
From Friess' mouth comes the statement: `We are not buying hopes and
dreams. We want to see the whites of the eyes of the profits.'
On the other side of the academy of investments and the masters is John
Neff. He is the so-called steward of the very successful Windsor Fund. For
30 years he has been its head honcho, and he wasn't placed there by fate
or by default.
Presently he is resting on his laurels, or more accurately, enjoying the
riches accumulated over three decades. But Neff is sporting enough to lend
the fortunate readers some of his hard-earned wisdom and strategies.
Neff's four basic principles:
* Low price earnings ratio,
* High dividend yield,
* Strong company fundamentals, and
* An eye on the big picture.
There's a fifth principle. According to Neff, `You have got to keep an
open mind. You have to be a student of history, but you can't be a captive
of history.'
Neff speaks from experience. His company pursues and captures stocks of
downtrodden firms and ventures down the avenues of the stock market where
braver souls fear to tread.
The fact that he has emerged victorious to spin his tales of success and
wealth is ample testimony to his deep understanding of the territory he
has conquered.
It is sheer delight to listen the top guns of Wall Street pontificating
about their exploits and relating the financial shootouts they had engaged
in. Most of them narrate hairy episodes which would have given those with
weaker constitutions cardiac arrest.
Among the awesome eight reigns one who is as colourful as Indiana Jones.
Strangely enough, his peers have nick-named him just that. He is Mark
Mobius, president of the US$ 13 billion Templeton Emerging Markets Fund.
Mobius is the type of investment strategist one would have thought
existed only in the studios of Hollywood. To hear him say it sounds like
an adventure penned by the likes of Jules Verne or Arthur Conan Doyle.
Mobius said: `When the markets are down, I am a much happier person.
Tumult is good. When we hear about recessions, disasters, revolutions, we
know there will be an opportunity.'
This bald-headed Wall Street version of Yul Brynner lives an ultra
hectic life. In a typical business trip to Russia in August last year,
Mobius blazed through 36 Russian companies in three different time zones.
He does not believe in gathering information from magazines or newspapers.
To him, information gathering means seeing it for oneself.
The investors' magazine Smart Money declares, `Mark Mobius was one of
the first American fund managers to invest in these countries (nations
which have volatile economic performance records), fighting his way
through their Byzantine bureaucracies and laying the groundwork for other
managers to follow. And make no mistake: They do follow.'
Despite the kudos heaped on his doorstep, Mobius is humble enough to
admit, `We don't always pick winners. In fact, I would say that if we are
right 60 per cent of the time, we are doing well. Poor investments go with
the territory. Hopefully, we have learned from them. But the problem in
this business is that you don't have the chance to correct mistakes very
often because they are beyond your control.'
Mobius' greatest strength is that he seldom makes mistakes no matter how
much he downplays his investment skills.
Beyond Wall Street reads like an intergalactic journey that covers a
long chain of unexplored planets. To the ordinary investor, it is like
going bowling with world champions and watching them knocking down the 10
pins like they are having breakfast.
The moves they make, the chances they take are definitely not for the
faint-hearted. In Wall Street, when the stakes are extremely high, when
the money reaches seven zeroes or more, those who can't stand pressure
should opt for a less stressful profession.
Nonetheless, it is an absolute joy to know that there are people like
William (Bill) Gross around to educate the likes of us on the intricacies
of making it big time and earning super mega bucks. There are so many
zeroes in Gross' Pacific Investment Management's (PIMCO) bond trading
operation that you will be forgiven for mistaking it for the national
budget of a developing country.
Gross has been quoted as saying: `If the market is strong, our assets
could be half a billion (US) dollars more than when I woke up this
The authors of this fascinating book describe Gross this way. `Besides
an uncanny knack for reading the bond market's signals, PIMCO'S founder
attributes the firm's success to a laundry list of winning factors:
discipline, hard work, common sense, good luck, prudent risks and
consistent application of a sound investment strategy.'
But the last word on the bond game rightly belongs to Grosswho says,
`Everyday you wake up, and it's a different story. It is a different set
of circumstances and a different set of facts to sift (through) and focus
on. But when you really get down to it, it's the game playing of the
markets, the fact of winning or losing and the reinitiation of the battle
every morning. It's so exciting and keeps me young. It's kept me going for
20 years and hopefully will keep me going for 20 more. It's just
fascinating work.'
The gist of this book is about beating the market and keeping ahead of
the rest of the pack. These are not rats, but wolves, we are talking
about. They would be quite happy to feast on you should you stumble, fall
and not get up.
Beyond Wall Street has its own moral. It is this. Nobody is right all
the time. Failure features significantly in the arena of financial
gladiators. But, and it is a big BUT, failure often has a very short life
span. Sooner or later, success comes charging back. And if you are a
master of the game, you will be able to predict its return quite
accurately. The eight investment strategists in this book have done it
again and again, very successfully.

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