Khalil
F. Matta invesment Q&A
He may be a professor of management at Notre Dame, but that didn't
keep Khalil F. Matta '80M.S., '82Ph.D. from making what he calls
"boneheaded investment decisions." Although filled with humor,
his Thou Shalt Not Invest Foolishly: Confessions of a
Business Professor (1st Books) can be almost painful
to read, as Matta again and again watches his investments go sour.
But out of lemons, he had made lemonade -- and investors may profit
from a sip.
ND: Why go public with your mistakes?
Matta: First and foremost I'm an educator and
I thought there was a need for getting people educated on what
can go wrong in the stock market. I always thought of myself as
fairly smart, and I was really surprised that I could do such
"primitive" mistakes. Then I saw that a lot of my friends and
my colleagues shared my ignorance about investing. I though the
general public might learn from the mistakes, and not experience
the pain and suffering that I have.
ND What is the first thing you would advise
investors?
Matta: The main theme of the book is that one
should view investing as a means to build a long-term nest egg.
I think most people confuse investing and speculating. You should
think long term rather that short term.
ND: What should investors avoid?
Matta: One thing that you should never do is
leverage your investments -- never borrow money to invest.
ND: The book was written before the bear market
took hold. How do you view the current economic climate?
Matta: I think the lessons in the book apply
anytime. Bear markets are a fact of life. They basically punish
speculators more so than investors, because speculators have a
short-term horizon. Investors should have a long-term plan.
