Monday, January 25, 1999

Investment clubs survive flap

The Cincinnati Enquirer

        As the bull market continues, so too does the start-up of investment clubs — locally and nationally.

        “The interest is hot and heavy,” says Mary Lyn Goerke, president of the OKI Tristate chapter of the National Association of Investors Corp. (NAIC).

        Not even the widely publicized travails last year of the famed Beardstown Ladies has stunted the pace of growth of new clubs.

        “People questioned it and wanted to talk about it for a couple of weeks,” Ms. Goerke said, referring to the news that the “Ladies” had mistakenly over-calculated their club's historical returns. “(But) people are still looking at the Beardstown Ladies as a positive example of what people can do. The main thing is learning.”

        The Beardstown Ladies are credited with sparking widespread interest in investment clubs. America was introduced to the women and their straightforward, folksy investment style in 1991 on CBS This Morning. More TV appearances followed, and eventually several books and national speaking engagements.

        Meanwhile, investment clubs mushroomed nationwide and across the Tristate.

        The number of clubs nationwide more than doubled from 1994 — the year the Ladies' first book was pub lished — to 1996, with membership swelling to 25,409. The Cincinnati and Northern Kentucky area saw similar growth during that span, with local clubs jumping to 312 from 157 in 1994.

        The pace of start-ups has slowed somewhat in the last couple years but remains robust. Today, there are an estimated 37,500 clubs nationally and 425 in the Tristate.

        Two years ago the OKI chapter put on its first-ever seminar designed to help neophytes start an investment club.

        Interest has since grown so much that the OKI chapter now puts on four such seminars a year, two each in the Cincinnati and Dayton, Ohio, areas. The first seminar for 1999 is coming up Wednesday at the Sharonville Convention Center, followed by one Feb. 1 in Kettering at the Town & Country Shopping Center.

        Ms. Goerke said she expects at least 50 people to attend the upcoming seminar, maybe even as many as 200, based on attendance at previous seminars. The fee is $10.

        The seminar is run by experienced investment club veterans who review the NAIC's steps to starting a club, followed by a question-and-answer session.

        Most investment clubs in the Unit ed States are members of NAIC, a 46-year-old nonprofit organization dedicated to investor education. NAIC publishes a monthly magazine, provides guidelines on how to start a club and criteria for picking quality investments.

        Reservations are required to attend the seminar. Call Gretchen Hurt at (513) 248-4354 or e-mail her at to save a place.

        Ursula Miller covers financial markets and investments for The Enquirer. She can be reached at 768-8573.


E-file: IRS, preparers make it easy
- Beardstown Ladies survive flap
P&G's always good bet, but analyst takes real shine to Clorox