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Book on KU investment class named must-read for getting rich

Tuesday, May 27, 2008

A leading national financial news site has placed on its top 10 "get rich" summer reading list a new book by twoKU School of Businessfaculty members that details how their student investment class' earnings have easily beaten the market annually for more than a decade.

TheStreet.com cited "Applied Portfolio Management: How University of Kansas Students Generate Alpha to Beat the Street" (John Wiley and Sons, April 2008) by Catherine Shenoy and Kent McCarthy to a list that included books by Jim Cramer, host of CNBC's Mad Money; David Einhorn, a prominent hedge fund manager who runs the $6 billion Greenlight Capital fund; and Business Week journalist Spencer Ante.

KU students in the School of Business' Applied Portfolio Management program learn the fundamentals of investing using real funds. McCarthy, a successful hedge fund manager and a Executive Lecturer in the school, returned to his alma mater in 1993 to help start the class and seed the initial portfolio with $230,000. Since then, the students have earned an annual average return of more than 20 percent and grown the fund to $1.4 million.

"That blows away the NASDAQ's average of nine percent over the same period," said Shenoy, the program director.

The book emphasizes that investing is hard work. In the APM class, students learn the importance of understanding what drives business results and to look beyond hype to identify what's really going on with a company, Shenoy said. These tools for success can be used by anyone looking to make money with stocks, she said.

"If the average investor is a large mutual fund, then being a small investor, like the APM class, is an advantage," said Shenoy. "We can look for mispricing in stocks that are unloved by the big mutual funds. Understanding the motivation of other market participants and how to use that information to your advantage is another key to successful investing."

In the book, KU faculty use examples from class research and results of the APM investment portfolio to teach readers all the essential skills that business students learn in the classroom.

TheStreet.com is an award-winning Web site that specializes in coverage of financial markets, economic and industry trends and investment and financial planning. The site boasts millions of readers every week.

Telephone orders for the new book may be placed by calling 1-800-225-5945. Half of the royalties from sale of the book will be returned to the APM class fund at KU.

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