Investors Guide To Special Situations In The Stock Market

Cl) .,, ,..., C:> -· = st - C'D l:li r- Cl) 0 C") � -i: � � - a- ""'! en... c: c:") = -· =C'D ..... 0 � I» = <> Cl) =t == - = :z en .,;. > ' . '\� ,, , _,,,-. l Investors' Guide to SPECIAL SITUATIONS . in the Stock Market By MaureceLSchiller, Author of FORTUNES IN SPECIAL SITUATIONS IN THE STOCK MARKET AMERICAN RESEARCH COUNCIL Larchmont, N. Y. y ')/ l 1 \) �� 1-\G l\S').\ ., �, s�· I) j.;r Preface COPYRIGHT o 1966, BY MAURECE SCHILLER ALL RIGHTS RESERVED, INCLUDING THE RIGHT TO REPRODUCE THIS BOOK OR PORTIONS THEREOF IN ANY FORM. LIBRARY OF CONGRESS CATALOG CARD NUMBER 66-26925 Printed in the United States of America. The information in this Report is based on sources and cornpuwiions belieticd to be reliable. It has been carefully checked for completeness aJld accurac.>· but cannot, be guaranteed. Noth ing in ehis Report is to be token as advice to buy or sell s�ci­ fic securities. SPECIAL SITUATIONS! What an exciting and mysterious-sounding name, filled with such promise of extraordinary rewards! However, contrary to what many uninformed investors believe, Special Situations investing does not mean taking a "flyer" in a risky, end-of-the-rainbow stock. Rather, it is an extremely selective and informed approach to investing based upon very real advantages. Some of these are: SAFETY: The basic prerequisite for "real" Special Situations is ready availability of hard facts and sound premises. This is often in contrast to some so­ called Special Situations having, in the main, nothing. more than a typical business venture offering hope and expectation. Special Situation investors want to know where the "real" is and where fancy takes over. A prime benefit of this approach is greater safety and peace Qi mind, particularly during turbulent market days. In many types of Special Situations, too, the investment follows a p redictable course of work-out within a specified period, regardless of the course of the mar­ ket as a whole. CAPITAL GAINS: In many cases, Special Situation investing offers a broader m arket horizon for capital gains than is usually found in ordinary secur­ ities. The potential gain can be calculated in many instances and the field is suf­ ficiently wide to satisfy the needs of all types of investors. With the level of tax rates so high, capital gain has become virtually the only way to accumulate large sums of capital. ,• IllDDEN VALUES: In addition to more specific benefits, many Special Situ­ ation investments often have the quality of "romance" - that is, the possibility of additional inc9me and capital gain developing even after the calculated Special Situation objectives have worked out. These windfalls can often be a very happy extra. PERSONALITY: It is important to understand that securities investing is not only the proper placement of money in well-chosen investments, but, to a great extent, the proper placing of the investor in the right security suited to him person­ ally. Successful investing often complements the investor's personality, whether individual or institutional. A speculatively-minded investor would be unhappy with a slow, plodding, growth-type security. Incompatibility could hasten clisposal of the investment before maturity and cause him to lose out on many benefits of the situation. A conservative investor would be unhappy, too, in a speculative venture, since he would be psychologically unsuited to ride with market gyrations, the usual Contents pattern