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Con #4: Snow JOBS

December 4, 2012

In a rare example of bipartisanship and common sense, the U.S. Congress last April approved the Jumpstart Our Business Startups Act (aka JOBS). 

In the real world, a “jumpstart” would require quick action.  Congress and federal regulators, unfortunately, don’t act in the real world.  And so we have a key provision of JOBS – an end to the “general solicitation ban” – in limbo.

PR Peeve #3: LET’S CAPITALIZE EVERYTHING!!! The Case Against Upper Case.

December 2, 2012

Too many people are screaming to be heard. In an effort to stand out, they Capitalize Words that should be lower case. Or, worse still, they use ALL CAPS! (the exclamation point is also common, and some even use multiple exclamation points.

The worst offenders though are the associations that try to make certain terms special by not only capitalizing every letter, but registering the name as a trademark. For example, a real estate agent affiliated with the National Real Estate Association is called REALTOR®. This, no doubt, enables the association to charge higher dues than if its members were called realtors.

Pro #2: Lower Risk, Higher Reward, Part 2

November 30, 2012

A couple of ex-Fidelity execs created a tool called FundReveal that rates mutual funds based on risk, reward and persistence of performance.  One distinguishing feature of the tool is that the entire universe of mutual funds is shown on a graph, with risk as one axis and return as the other.  Mutual funds in the lower right quadrant have higher risk and lower return than the S&P 500.  Those in the upper left quadrant have lower risk and higher return than the S&P 500.

FundReveal (a former client) has been featured in Investment News, The Mutual Fund Observer, MarketWatch and elsewhere.  Unlike most other rating services, it provides an objective analysis of all mutual funds.

PR Peeve #2: Press Releases

November 29, 2012

Clients often think that all public relations agencies do is send out press releases.  PR agencies reinforce this notion, because press releases are easy to prepare and agencies can charge lots of money for them.

While press releases should be used to announce breaking news, they are typically the least effective method of publicizing your company.  Unless a press release has news value, no one will run it and few will read it.  A press release is also a great way to ensure that top-tier media will not run your news.  The Wall Street Journal and other top media want exclusivity.  If you send out a press release, it tells them that every other financial media outlet will be getting the same news.

While press releases should be used for breaking news, in most cases they should not be the main focus of your public relations program.

A summary of PR Peeves initially appeared in an article we wrote for the Worcester Business Journal.

Finding An Angel

November 28, 2012

The economy is weak, capital is scarce and Congress is considering a new tax on angel investing. Money is difficult to come by for almost any business.

Yet entrepreneurs seeking angel funding often believe in their business so strongly, they don't understand why investors aren't lining up to give them money.

Pro #1: Less Risk, More Reward

November 27, 2012

Most investment managers base their practice on modern portfolio theory, which says that greater risk yields greater rewards and that markets are “efficient,” meaning that they self-correct and reflect the true value of stocks, bonds and other securities.

It turns out, though, that modern portfolio theory is in need of an update. An award-winning paper from Mike Hartmann of Plan To Invest Capital Management, Inc. not only disproves modern portfolio theory, it provides a new way to pick mutual funds. Hartmann’s paper, “Short Term Alpha as a Predictor of Future Mutual Fund Performance,” shows that:

  • Less risk may mean more reward
  • The “efficient frontier” isn’t so efficient
  • Short-term alpha is an effective predictor of mutual fund performance

Check out this insightful white paper and let us know what you think of Mike’s findings. Disclosure: Plan To Invest is a client.