Wall Street Oasis - Investment Banking & Finance Community: Guilt by Association Breeds Value

Wall Street Oasis - Investment Banking & Finance Community The Wall Street Finance Community where investment bankers, consultants, traders, private equity and hedge fund professionals come to learn and play.

Guilt by Association Breeds Value May 26th 2013, 05:00 There's certain industries, ideas, and geographical pairings that can make a business undesirable to the majority of the market. Of course the idea of investing in a Cypriot bank, a low-end big box retailer, or a for-profit education business is going to come with quite a bit of skepticism and concern, but not all companies that fall into these categories should be labeled as toxic. You'd have missed out on amazing discount retailers like Ross Stores (ROST) and TJX (parent of TJ Maxx and Marshall's, among others) because you were so deathly afraid of JC Penney, for example. Both ROST and TJX, though on the outside appearing to be extremely similar to a JC Penney or Kohl's, actually operate on a fundamentally different business model. The same can likely be said of some financial institutions in Cyprus or some for-profit education related business. Our idea of the moment falls along this same line of thinking, taking advantage of the market's hesitation to invest in a company whose description is so ominous on the outside (or at least sounds that way) that it goes unappreciated for being remarkably unique from its peers. Imagine coming home to tell your family that you've invested your savings in a Chilean mining company. read more Media files: preview (image/jpeg, 0 MB)

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