A recent article in Forbes Magazine titled "The Obesity Index" highlights just one of many strategies that investors make when playing the market. In this scenario, James Altucher of Formula Capital has taken a personal position, that obesity is bad, and translated that into a possible investing scheme (with scheme not being a negative connotation).
Altucher has taken a personal interest in finding companies that fight obesity, and then investigating how they perform for investors. His article highlights the fact that an investor can be both focused on philanthropy and smart investing. I wonder, however, how NutriSystem (as one of his highlighted stocks), with its prepackaging, would affect my environmental stance. Of course, the balance comes with which pull is stronger: I want to help support getting rid of obesity, but I also want to support the environment. Prepackaged meals create much waste. But saving U.S. dollars by fighting the obesity epidemic might just help those same people eat less red meat, which would lessen our support of fast-food establishments, which certainly create waste and pollution and tear down rainforests through the creation of cattle grazing land. The permutations are endless!
Picking emotionally tied investment choices reminds me of how I play-invested as a child. I would use our local Fayetteville Observer newspaper and follow all the companies that advertised during NCAA basketball season. Jefferson Pilot was the one that immediately comes to mind. During 7th-grade investing class (we only had it two days stretched over a month, if I recall), I "bought" all those stocks of companies who supported my TV viewing habits. And I lost money horribly. It might have been because I had no idea what investing really meant. It might also have been because I wasn't being logical with the choices. Or, maybe, it was because I wasn't really investing any money and my short attention span was too busy watching Duke and NC State basketball.
Glenda is right--had my school actually spent more time on investing and less on catechism and home economics, more of us would be quite comfortable with where our money goes and how to invest.
3 comments:
Julie,
Thanks for commenting about my aritcle. I don't necessarily have the personal view that obesity is "bad". But rather, the fact that over 300,000 deaths per year can be linked to obesity and that $33bb in healtcare services are spent each year on this problem leads me to think that eventually capitalism will force us as a culture to take action and that will benefit the companies involved.
-James Altucher
Julie,
I found your article interesting, so I went to the link and read more. Out of curiousity, I checked the last 2 years of the NutriSystem price index. In April 2005 the shares sold for $7 each. In April 2006, the average was $46 and today's asking price is about $56. Just goes to show you that we as a nation spend more money on weight-loss gimmicks instead of doing what our parents did - eat 3 good meals a day and very little, if any snacking.
Thanks, James, for responding! I'm thrilled to have had the opportunity to have this small discussion with you.
I'll be blunt on my end--I don't think people who are overweight are bad, not at all. But I fear obesity and what it does to people. Early death, poor health, horrible self-esteem, etc. abound, not to mention how addictions tied to weight cross over into issues related to the environment and sustainability.
And your piece inspired me to think further about how I can actively, positively, use my power as a consumer and investor wisely. Thanks again!
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