Investment club hits it big

January 2, 1997: 1:59 p.m. ET

Group of buddies started investing in Humana, now they vacation in Aruba
From Correspondent Lesley Geary

CHICAGO (CNNfn) -- Investors are expected to continue to profit from the longest bull market in history.
     As a result, investment clubs are popping up left and right, becoming as common as book clubs or friendly poker games.
     There are an estimated 18,000 investment clubs around the country, but one was started with a special purpose in mind -- to pay for vacations.
     Four high school buddies from Chicago defied the odds, creating their own investment club 15 years ago.
     "We got together in a hotel room downtown, and the idea popped up that we'd like something to keep us together," Nick LaBrasca, who works as a sales manager, said.
     The club had seven members when it started, and now has five. Each contributes $100 a month to the pool. Members research investment ideas on their own, then bring them to a vote at quarterly meetings.
     At one such meeting Anthony Grassi, who is a human resources manager by day, made one recommendation: "I'll make a motion to target Toys R Us as a sell, but not until at least January or February."
     The club, legally named the Boys Partnership, invests mostly in big-name stocks like Microsoft, Walt Disney, Humana, and McDonald's. The Boys pick companies whose products they use. (WAV, 80K) or (AIFF, 80K)
     They invest a small portion of their money in Fidelity's Magellan Fund, and a bit of it sits in cash to pay for quarterly meetings over dinner.
     The strategy's paid off. Since its inception in 1982, the boys have beaten the Dow Jones Industrial Average by 2,000 percent.
     The original objective of the club was to build up money for a grand vacation when the members turned 50. But the fund's done so well, the five friends have taken three annual excursions already, including trips to Aruba, Colorado, and a fishing trip to Canada.
     There's enough money now to include their wives and children on the vacations -- it's become an annual ritual that the group hopes will last well into retirement.
     "Maybe we'll still be investing at that point in time, maybe we won't," Grassi says, "But we will have enough in common so that we can retire and still have a good time together."