notion of shelf space in a grocery store, where if you controlthe shelves in the Safeway chain, you can use that to sell a lot ofproduct. Obviously, people won’t buy things they don’t want, but ifthe product isn’t on display, they'll never see it. The major differenceis that you can drive to various stores and walk around. But, in theonline world, you have people focusing for long periods of time ona single square foot of real estate.
Tanous:Like a computer screen?
Shaw: A computer screen. People who work in the informationbusiness, like you and I, spend a large part of their day watching thatscreen. So having contact with those people becomes extraordinarilyvaluable. How that contact can best be exploited is not entirely clearyet, because the industry is changing so quickly. At least it’s not thatclear to me. But it seems fairly clear that there will be many ways toextract value from this sort of “digital shelf space,” whether by puttingads there, or providing on-line shopping, or managing people’s finan-cial lives, or whatever. However things evolve, we want to be involved.
Tanous:Juno already exists. Now I have e-mail through AmericaOnline and Netscape. What’s Juno going to give me that I don’t alreadyhave?
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Shaw: First of all, if you’re like me, and most of the time you spendonline is spent reading and sending e-mail, you may not want to payan online service for something Juno can give you for free. It’s alsomuch simpler to use than a full-blown online service. Here, I’ll giveyou a copy of the software. [David hands me a disk with the Junosoftware on it.]
Tanous: Thanks. I’ll try it at home. [You can get your free copy byphoning 1-800-654-JUNO.] Now let’s talk about FarSight, another ofyour creations.
Shaw: The idea behind FarSight is similar, in some ways, to Juno.The basic notion is digital shelf space: Get the eyeballs on our screen.Here we’re trying to tie all of the aspects of a person’s financial lifetogether. The goal is to allow the user to be able to do brokerage,checking, commercial banking, automatic bill-paying, and in the longrun, probably a number of other things, through one integrated sys-tem.
Tanous:I heard you spend a lot of time in Washington. What doyou do there? Do you want to change the world or something?
Shaw: I'd love to if could, but one of the main things I’m learningis just how difficult and time-consuming it is to make changes withinthe public sector. I don’t have a better prescription for how to designa government. As is often said, it may well be that this is a terriblesystem, but there aren’t any better ones. My limited experience ingovernment has made me more appreciative than ever of the freedomand the rapid pace of the private sector. All that being said, | wastruly honored when President Clinton appointed me to the President’sCommittee of Advisors on Science and Technology a couple of yearsago. It’s really a very part-time job. We meet with the President occa-sionally, and by ourselves a bit more often. In between meetings, wereview various things that are going on in government that have todo with science and technology.
I’m also now serving as chairman of the Panel on EducationalTechnology to advise the President on how computing and networkingtechnologies might be used to improve the quality of America’s K-12schools. The President announced his educational technology initiativein the last State of the Union address, but we still have to come upwith a more detailed picture of what ought to be done in that area.It’s a terrific panel - two of the eleven members are Nobel laureates,and we've also got Chuck Vest, the president of MIT; John Young,
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the former CEO of Hewlett-Packard; Sally Ride, the former astronaut,who also happens to be a first-rate scientist; and several of the leadingexperts in the field of educational technology, among others. Buteven with all that creative brain power on board, I’m finding that ittakes a lot of my time to serve as chairman, and I’m looking forwardto sending our final report off to the President and getting back tohaving an occasional weekend or evening free.
Tanous:Last question. What sort of advice would you have for theaverage investor who wants to make money in the stock market?
Shaw: Because they generally don’t have access to hedge funds, Iactually think - and this is what I tell my own relatives - that theirbest bet is to keep expenses down and stay well-diversified. As forasset classes, even though there’s no guarantee that the future willlook anything like the past, there’s a fairly widespread belief that theequity market is associated with excess returns. Over the long term,equities may be a pretty good bet. So I would probably recommenda fairly conventional sort of asset allocation, but with very low ex-penses. One good choice might be index funds, since they turn overinfrequently, giving them some tax advantages, as long as you're notpaying out too much in management fees. Management fees onlymake somebody else rich, somebody who’s probably not adding anyvalue - at least based on the available statistical evidence. I think thatmakes a lot of sense.
Tanous:One of the theses behind this book is that I’m interviewingthe very best minds in the business, people I believe have demonstratedpredictability, like Peter Lynch, John Ballen, Michael Price, Eric Ry-back, Foster Friess, Mario Gabelli, and so forth. Wouldn’t you wantto use this kind of person to try to get excess returns?
Shaw: Maybe. The only thing I can say is that that’s an area I haveno special expertise in. My gut tells me that some subset of thosepeople actually are skillful, not just lucky, and that there is somethingteal there, but ’'m not sure I could tell you which ones are which.
My visit to D. E. Shaw is something I still think about a lot. Whenyou have spent over 30 years in the financial business, and you sud-denly encounter something completely different, it can be a bit unset-tling. Imagine. Computer scientists and Ph.D.s in math making moneyin the stock market. In David Shaw, we have met the acknowledgedmaster of the quants. Welcome to the future.
David has an uncanny ability to explain complicated theories in a
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way that most of us can actually understand. That is an unusual tal-ent. Of course, he was a professor at Columbia for some years, and Ihave a feeling he was a superlative teacher and must be missed there.Since you and I don’t have Ph.D.s in computer science or math (ordo you?)}, it’s not likely we would understand the algorithms andmethodologies he uses. But, not to worry. He’s not going to tell us!David Shaw’s secrecy only adds to his mystique on Wall Street. Infact, few people have actually met him. You and I are in rare company.
With his capital base of $800 million, and his huge trading volume,David Shaw is in the forefront of the computer and informationtechnology revolution. And remember what he told us: the craze overthe internet is real! Yet when you talk to him about the way most ofus will make money in the stock market, his first bit of advice is topay attention to costs. David knows how hard it is to beat the market.Adding costs, like management fees and trading commissions, canonly make it that much harder.
In our discussion of investment strategies for most of us, he wasleaning toward passive investments, like index funds, where the oddsare greater that, with low fees and an intelligent asset allocation, wewill do well. But then in his very last comment, he quickly opinedthat there probably are exceptional managers out there who do havesomething special, and who are skillful. “There is something realthere,” is the way he put it. Good advice to ponder as we contemplateour own investment programs.
Perhaps, some day, David will launch a fund that will allow thoseamong us who can’t write a $50 million check to have an opportunityto invest with him. Until then, we will have to satisfy ourselves withour visit with David Shaw, and our exposure to what may be the futureof investing for those with the brains and the wallets to enjoy it.
327PART THREEThe RouteYOUR ROAD MAP TO WEALTH
Our conversations are over. We have spoken to true investmentgurus - investment managers with unquestioned records of success,managers who stand head and shoulders above their peers. We alsohad conversations with great academics in the investment field, whoseaccomplishments include winning the Nobel Prize in Economic Sci-ences and whose theories are still followed and form the basis of in-vestment methods widely used today. In this penultimate chapter, wewill distill the knowledge and insights we’ve acquired into a practicalinvestment approach for all of us who want to build wealth to follow.
At the outset of our journey, I asked myself a series of questions,the great questions. The answers to those questions would providethe foundation upon which our ultimate investment program wouldbe built.
Now that we have spoken with so many leading investment lights,we must focus our attention on those points and issues that have thegreatest potential for our investment success or failure as individuals.Let me remind you of those questions:
Is investing in stocks the most intelligent path to wealth for mostof us?
If so, is it possible to consistently beat the market?Which style of investing is best?
What are the key characteristics of investment geniuses?
What did we learn from the Gurus that we can use in our own in-vestment program?
How can we replicate the Gurus’ success:
a) when managing money ourselves?b) by finding Gurus to manage our money for us?
Once we have mulled over the answers, I will share with you myconclusions and fashion them into an investment strategy I believewe can all use to successfully enhance our future wealth. Don’t worry,INVESTMENT GURUS
I'm not going to lay one of those boring and banal lists of dos anddon’ts on you. You've seen them a hundred times (“Dollar cost aver-aging is the key to investment success...Remember to diversify yourportfolio...Invest for the long term...”). I know this isn’t the first invest-ment book you've ever read and | don’t want to insult your intelli-gence.
I want to share another important, and personal, comment withyou. I mentioned early on that I have been in the financial servicesbusiness for over thirty years. You might think that after all that time,I pretty much already knew, at least in a general sense, most of whatthere was to know about growing rich by investing. My experiencein writing this book taught me otherwise. I was, frankly, amazed atwhat I learned. Had my education and knowledge, therefore, beenlacking? I don’t think so. I think instead that the experience you andI have had together, of sitting down and talking to some of thegreatest investment minds in the world, inevitably led to discoveriesthat no one person is likely to have uncovered otherwise. Okay, I'lltake a little credit for asking some of the right questions. There hasto be some advantage to doing this for thirty years! But again, Ilearned a lot. If you feel the same way, you are not alone.
Let’s take the easy question first.
Is investing in stocks the most intelligent path towealth for most of us?
Yes. Next question.
Oh, if you have any doubts, please go back to the chart on page 8,the one I nicknamed: “The Chart that Hungry Stockbrokers Considerthe Greatest Chart in the World.” If that doesn’t convince you thatstocks are the way to go, there’s not much more | can do to changeyour mind.
Is it possible to consistently beat the market?
This is the question that strikes at the very heart of the efficientmarket debate. We heard proponents of both sides. The top expertsin their field. One group told us that we could not expect to beat themarket except by chance. Other experts told us that they do beat the
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market. They do, in fact, seem to beat it regularly, and often spectac-ularly.
Let’s review the arguments briefly. The efficient market theoristsbelieve that the market is so efficient that everything that is knownabout a stock is reflected in the current price. To them, research de-partments, forecasts of earnings, newsletters full of advice, and allthe rest of the stockpicking paraphernalia are a waste of time. “Invest-ment pornography,” Rex Sinquefield called it. Is it the equivalent ofbelieving in clairvoyance? There _are no mispriced securities, theysay. So why do stocks go up and down, you ask? Because of new in-formation coming into the market all the time. That new information,which may be good or bad, will have an effect on the price of thestock. Only you don’t have that information in advance.
So, why buy stocks at all? Because, they say, over time and throughhistory, investors have demanded at least some extra return on theirmoney for taking the risk of stocks. That’s pretty logical. If owningstocks only got you the same return as buying treasury bills, whywould anyone take the risk? So equity markets, on the whole, rewardinvestors for the risk they take.
Now you start to see the logic of the efficient market theorists.Since you can’t really predict the future of a given stock, what youmust rely upon is the overall return the market offers. More recently,the great academics, like Bill Sharpe and Gene Fama, have advancedour knowledge of how stocks behave by identifying the performancepattern of specific styles of stocks. We learned, for example, thatvalue stocks outperform growth stocks, presumably because they areriskier, and you only get paid for the risk you take. Likewise, smallstocks outperform large stocks because the small companies are riskierthan the large companies.
So, if you want higher returns than the general market offers, justbuy more small stocks or value stocks for your portfolio. You wantless risk? Tilt your portfolio toward large growth stocks. Of course,you don’t actually select what stocks to buy; you buy an index fundthat emulates the entire market, or some size or style sections of themarket. Your portfolio will have a mix of these different asset classeswhich match your own requirements.
That’s the basic argument.
The active managers see it differently. Good research pays off, theysay. The efficient market theorists are wrong. There are undervalued
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securities, undiscovered securities, and mispriced securities out there,and there are plenty of them. Hard work, good investment skills, atalent for investing, all these qualities will give you an edge. Remem-ber what Peter Lynch told us: “I’ve always said that if you look at tencompanies you'll find one that’s interesting. If you look at 20, you'llfind, two; if you look at 100, you'll find ten. The person that turnsover the most rocks wins the game.” That’s the “hard work” thesis.
To this crowd, there is no question that a very good investmentmanager can beat the market. Of course, not all of them can, sinceall of them together constitute the market! But, as in every field, therewill always be some exceptional performers who excel at what theydo. Do you doubt this? They point to their records - I’ve beaten themarket consistently over the past (so-many) years. That’s proof, isn’tit?
Not really, say the efficient market theorists. That’s just the effectof a normal distribution. There will always be outliers, those who doexceptionally well and those who do exceptionally poorly. Hey, Tan-ous, the people you interviewed are the outliers. The question is, willthey be there tomorrow? Sure, everybody talks about Warren Buffettand Peter Lynch, but how many more of them do you think thereare? They define “outlier.” The word, my boy, is “persistence.” Showme persistence and maybe you have a point. But all the studies wehave seen suggest that the great managers of today are the has-beensof tomorrow. What good is great performance if you can’t predict itin advance?
There it is, my friends. I hope I have adequately summarized theviews of the two camps. Our moment of truth has now arrived. It’stime to come to the conclusion that this book purports to draw, albeitin a completely unscientific way - not as a serious academic study,which it most assuredly is not, but as the observations of a profession-al in the investment industry, after conversations with some of theindustry’s leading managers and academics.
Have you reached a conclusion yet? I suspect you have. Let’s seehow your conclusion compares with mine.
To begin, I found the arguments on both sides very compelling.The passive investment proponents, the efficient market theorists,offer a tempting alternative when they say, why waste your timepicking out stocks and managers? You are taking a lot of risk whenyou do that. Buy markets, or styles, or size of securities and you'll
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have a much better idea of what you will get. And think of all thetime and fees you'll save! In this, they are right, of course. And wewill take this point into account when we talk about our recommendedinvestment strategy in the last chapter.
But did the efficient market theorists prove their case - that greatinvestment performance comes only by chance? I don’t think so. Ikept a very open mind about the subject as I traveled across thecontinent researching the question. And lest you think that I mighthave a bias based on my work as an investment consultant, let metell you straight out that, in my firm, we recommend both passiveand active investment strategies and will continue to do so based onthe requirements of the client. So I have no turf to protect or be influ-enced by.
Here’s the point: We interviewed some of the top investment talentin our country. I don’t pretend that these are the only great investmentminds out there, because surely there are others. But I think that ourGurus proved the point without a doubt. The efficient market theoryis flawed. There are simply too many examples of stocks that werediscovered by a great manager before anyone else knew what wasgoing on. A vivid example is the Michael Price story about tantalum.He picked Kawecki Berylco and Molycorp and International Miningbecause he did his homework. Go back and reread our conversation.There were many other good stock picks recalled by our Gurus.
Does that mean that the market is inefficient? No. Here is the con-clusion I have arrived at: The market is not perfectly efficient at alltimes. However, the market is constantly in the process of becomingefficient. By that, I mean it takes time for efficiency to be achieved.The notion that information is reflected in stock prices instantaneouslyjust doesn’t seem to hold up. We have run up against too many caseswhere thorough, painstaking research combined with seasoned invest-ment judgment have given the investor an advantage. I do not believethat these examples can be dismissed as anecdotal blips. There aretoo many of them. In time, the information that the Gurus uncovergets reflected in the price of the stock and the stock price moves upor down toward that “intrinsic value,” or true price. Hence the marketis constantly becoming efficient; it just isn’t instantaneously efficient.Great managers see these changes coming, not through clairvoyance,but through skill. Re-member Richard Driehaus. He combines skillwith uncanny investment abilities to take advantage of “positive
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earnings surprises” before the surprises are reflected in the price ofthe stock. But the real skill is his ability to identify and stay with thewinners and quickly shed the losers.
What about the “persistence” issue? The efficient market theoristsclaim that our Gurus are the Gurus-of-the-Moment, if you will. Nextyear, there will be another, different set, they say. I don’t think so.For one, we made damn sure that those we chose had that quality ofpersistence. Nobody becomes a Guru in this book with just one ortwo years of hot investment performance. Here’s the test. Go backthree, four or five years. Look at our Gurus from that vantage point.How did they look then? For the most part, very good. A decisionfive years ago to invest with almost any one of our Gurus, based onhis or her track record at the time, would have resulted in a soundinvestment decision. The persistence was there. Persistence persisted.
My conclusion: you can, in fact, beat the market. If you put in thetime and the work you have a fighting chance of doing it. I thinkyour odds are better if you spend your time finding the right Guru todo it for you, although only you can assess whether or not you areprepared to do what it takes to succeed. That does not mean that youshould shun the passive investment strategies altogether, and we willdiscuss ways to use passive strategies later.
Which style of investing is best?
Many of you reading this book learned about style differences insecurities for the first time. Others were already very familiar withthem. We learned, among other things, that different styles of stockshave different performance records. We learned, for example, thatvalue stocks have outperformed growth stocks over time. Why thishas happened is somewhat more controversial. Rex Sinquefield toldus that this occurs because value stocks are riskier than growth stocks,and you get rewarded for the risk you are willing to take. Others madethe case that value stocks aren’t riskier, citing studies that showedthat, since the end of World War I], value stocks outperformed growthwith no discernible increase in risk. We also learned that small-capstocks outperformed large-cap stocks over time. Here, the idea thatsmaller is riskier was not challenged as much. So what’s the answerto the question?
If we were looking for a single answer, it would probably be that
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on a long-term, risk-adjusted basis, value stocks are the way to go.But that’s not the best answer. The right answer, in my opinion, is todiversify your portfolio as much as possible in different styles andclasses of securities with different risk components. You want to use,as much as possible, noncorrelating asset classes. That is a fancy wayof saying that you want stocks that don’t all go up and down in lock-step. Remember what Peter Lynch told us about style: “If value fundsare out of favor, Mario Gabelli and Michael Price can’t be expectedto perform as well as a growth fund, if growth is in favor.” As usual,he is absolutely right.
Value and growth stocks, small and large stocks, tend to do wellat different times in the market cycle, although both possess marketrisk as a common element. Reread the Sinquefield interview for thisdiscussion.
In our chapter on portfolio construction, we will take these charac-teristics into account to suggest a portfolio structure that combinesthe best elements contributed by the investment academics, alongwith the experience of the Gurus we interviewed.
What are the key characteristics of investmentgeniuses?
You may have developed your own list. Compare it to mine, basedon our interviews with the Gurus:
Discipline v Every one of the Gurus had this. No wishy-washy in-vestment approach that changes with the times or the current stateof the market. Some of their philosophies may have evolved overtime, but they don’t vacillate. They stick to their guns. It reminds meof successful bowlers. I learned this early on when I was first learninghow to bowl. Professional bowlers always throw the exact same shot.They practice just one move. It’s like a pitcher who only throws onepitch, and it always goes the exact same way. That’s what bowlersdo. In order to hit the pins they want to hit, all they do is move theposition and starting point of the ball’s trajectory. But it’s always thesame shot. Discipline.
Focus v This is a corollary to discipline. Keep your eye on the ball.And they do. Our Gurus just don’t get distracted by the fad of the
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moment. They are seasoned professionals who know what works forthem and they stick with it.
Intelligence ¥ We heard that a lot, didn’t we? Yes, you have bevery smart to succeed at this business. That shouldn’t be surprising,but to many, it is. I suppose it’s because so many people look at thestock market like a big casino where some lucky gamblers win. Nottrue. It does take smarts. I trust this point came through in the inter-views.
Hard work w This doesn’t come as much of a surprise, | hope. Wesaw countless examples of the amount of work these people put into identify companies that are worth buying. As in so many of life’sendeavors, you get out of it what you put in. It’s that basic.
The Great Intangible v Let’s face it. Some of these Gurus havesomething “extra.” Problem is, the “extra” is tough to put your fingeron. I remember occasions during our talks when phrases came up thatalluded to that something extra. Eric Ryback saying that he’ll hold astock until it “starts looking at me funny.” Driehaus deciding instinct-ively to sell his position in Altera while we walked around the tradingroom. Scott Johnston came right out and said it: I have a sixth sense.All great managers have a sixth sense, he added. These are examplesof instinctive behavior. What is it? Where does it come from? I don’tknow. Perhaps there really is a sixth sense. If it is there, the realquestion is how much does it contribute to performance? Can you bea Guru without it? I tend to think you can. If that something extradoes exist, I suspect it is not the predetermining factor that makes forgreat investment success. We saw too many other criteria that do.
What did we learn from the Gurus that we can usein our own investment program?
I hope you developed your own list along the way. I would like toshare some of the highlights of mine with you. I can’t really mentionall of the good advice we got here because I’d almost have to rewritethe entire book. Along the way, specific comments stuck out. Hereare some of my favorites. These are sometimes one-liners, other timesspecific investment ideas, all of which, I believe, we should use inour own investment programs, be they picking stocks, buying mutualfunds, or selecting investment managers.
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I was intrigued by a strategy that Bill Sharpe talked about andrealized long after the interview how much sense it made. Remember,this Nobel laureate is not a proponent of active management. But hedid outline his favorite active management strategy which, he toldus, he dubbed: “a modest proposal to revolutionize the investmentmanagement industry.” He may be right.
Let’s go over it again. He finds a great manager who specializes in,say, growth stocks. Then he tells him to identify the ten very beststocks he knows and buy them. Then he says, pick ten of the veryworst stocks you know and short them. In so doing, he has taken outof the equation one of the most important risks the investor faces:market risk. Why? Because even if the market goes down, he is hedgedby being long and short different stocks. Likewise if the market goesup. That means that he is only paying for selection, the manager’sability to pick the stocks most likely to go up and the stocks mostlikely to go down. In fact, that is really all we should ever pay for,since we can’t predict the direction of the market. This strategy issometimes known as “market neutral,” but be really careful, sincedifferent managers’ definition of this strategy vary widely.
I was equally fascinated by Peter Lynch’s approach to finding greatcompanies. Peter wrote about much of this in his own books, but theadvice is enduring. You start by observing. You see what companiesare doing well in your own backyard. You notice what products arebeing talked about. Then, if you're really ambitious, you get informa-tion on these companies and see if you can make a case for buyingthem early. You just can’t argue that this makes sense. I do, however,question your and my ability and patience to do all the work thatmust, inevitably, go with this strategy. Another bit of advice fromPeter: Great companies make great stocks. Simple, but telling.
While we’re talking about doing the research ourselves, it mightbe useful to re-read Professor Roger Murray’s advice on the kind ofresearch you need to do before buying a company. He spelled it allout: pick an industry, analyze the companies in it, do spreadsheets,do ratio analysis, narrow your field down from six to two companies,and start all over again. I admit that this doesn’t sound like a lot fun,but have I convinced you, at least, that finding great investments in-volves work?
Here’s a quick quiz: can you recall one particular phrase that keptcoming up in our interviews with both active and passive managers?
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Time’s up. The one I remember vividly is: “There’s no free lunch.”Seems to me there was always somebody trying to beat that notioninto our heads. For good reason, of course. The money isn’t lyingaround waiting for you and me to pick it up just because we read anifty article on investing or a new theory that works every time (onold data, of course). We’re back to doing the work.
We also learned a few things from the momentum investors. I im-mediately think of Richard Driehaus and also Bob Gillam. Buy com-panies that are going up, not down. Duh! But do we do that? No.Because we get scared when we see a stock hitting new highs everyday. We think maybe we missed that one, so we look for somethingelse. But those other stocks are going up and that’s why they’re hittingnew highs! So these guys look for accelerating earnings trends, posit-ive earnings surprises, and stocks headed in one direction. This, too,makes a lot of sense, but it is, as Rex Sinquefield observed, not forthe faint-hearted. Problem is, you may have to get out just as fast asyou got in if something changes. Best leave this approach to the pros.
How about the value crowd? We spoke to a number of them, includ-ing Mario Gabelli, Laura Sloate, the indomitable Michael Price, amongothers. This is the Graham and Dodd approach to investing. It requiresresearch and study to find those hidden jewels - companies that havenot been discovered or that have hidden assets not yet recognized bythe market. This approach makes sense for some industrious investorsbecause, in this case, you just might have some knowledge that othersdo not yet possess. For example, you might work in a field that givesyou special insight into an area. You could use your privileged judg-ment and understanding (although not inside information, of course)to invest ahead of the crowd.
There are also geographic advantages. Here’s another Peter Lynchquote from our interview: “I wish Home Depot had started here inBoston instead of in Atlanta.” What’s he saying? Just that you mayhave an edge if you see a great company or concept starting to takehold in your own backyard. Okay, it’s a bit of a stretch to call thisvalue investing, but the point here is that we are looking for hiddenassets. Finding them early is always a good idea.
Here is another important lesson we learned from the Gurus: thereare many different styles of investing and successful investors gener-ally choose one and stick to it. Laura Sloate buys value stocks. Period.Likewise Michael Price. But can you imagine Richard Driehaus picking
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a value stock? It’s almost funny. This point will come up in our nextdiscussion
Replicating the Gurus’ success: can we do itourselves, or should we find Gurus to manage ourmoney for us?
I am reminded of the interviewer who asks the candidate: do youconsider yourself a decisive person? The candidate responds: well,yes and no. My sentiments exactly.
There are only a handful of Gurus in this business. You met a greatselection of them. There are some things we can learn from them tohelp in our own investment programs. Let’s start by looking at thesteps we need to take to pick stocks ourselves and construct an intel-ligent portfolio.
Allot the time v First, if you set about picking stocks yourself, allottime to do the research. I realize that your broker may call you withsome nifty story, and presumably he, or his research department, didthe work, but ask a lot of questions anyway. If you are going to relyon someone working for you