What's the Buzz with Individual Stocks?

Opiela, Nancy
January 2000
Journal of Financial Planning;Jan2000, Vol. 13 Issue 1, p62
Academic Journal
This article highlights the benefits of individual securities in financial planning. Louis P. Stanasolovich, Certified Financial Planner, of Legend Financial Advisors in Pittsburgh, recently moved beyond mutual funds to offer clients individual stocks. Stanasolovich stresses, however, that he was reluctant to make the transition. Rather, his move was designed to avoid losing clients. He sees this increased appetite for stocks not so much from his current clients, but from potential clients. What's more, the bigger the prospect, the greater the desire to own individual stocks. People are excited by returns of the individual stocks they read about in personal finance magazines. While most agree that many Internet stocks are overvalued, they are still looking for the returns associated with these fast-growing companies. And, of course, they want these returns without the risk. Accordingly, in addition to the Dogs of the Dow stocks, be uses another strategy to keep clients on board: a newly created low-volatility portfolio using three mutual funds. Combined, the standard deviation of the funds is low, but the combined returns have been in the 15 percent range over the last three years.


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