130/30 investing requires applying certain principles to maximize its unique opportunities, Turner Investment Partners position paper says.

BERWYN, Pa. -- 130/30 portfolios, which employ leverage in an effort to capitalize on stocks perceived to have both good and poor return potential, have been dismissed as a fad by some skeptics. However, the latest position paper by Turner Investment Partners maintains that 130/30 strategies are more than a fad: they are a flexible "alternative" mode of investing that has the potential to deliver more alpha (the degree of outperformance) than traditional stock portfolios can. But 130/30 strategies present special risks that must be carefully managed to achieve that alpha.

Turner, an investment firm based in Berwyn, Pennsylvania, with more than $27 billion in assets under management as of September 30, 2007, publishes position papers commenting on industry issues each quarter.

The paper, entitled Eight principles of effective 130/30 investing, was written by David Kovacs, senior portfolio manager/security analyst, Chris McHugh, senior portfolio manager/security analyst, and Bob Turner, chairman and chief investment officer. It provides an overview of 130/30 investing and eight overarching beliefs Turner applied in an effort to maximize returns of its four 130/30 portfolios.

The paper reports that the popularity of 130/30 investing is growing: Merrill Lynch projects the 130/30 market will reach $1 trillion by 2012. As the market grows, the three Turner portfolio managers conclude, the best-performing 130/30 portfolios are "likely to be those managed according to a sound, proven investment process that incorporates risk-management elements such as stop-loss disciplines, sector neutrality, diversification, and asset-capacity limits. As we see it, the best 130/30 portfolios should deliver such an ample margin of alpha over time that the current notion that they are a mere passing fancy may come to seem downright quaint in retrospect."

To read this position paper in its entirety, see the Turner Investment Partners Web site, www.turnerinvestments.com/positionpaper. Or call 484-329-2439 for a free copy of the piece.

The views expressed represent the opinions of Turner Investment Partners and are not intended as a forecast, a guarantee of future results, or investment recommendations. Past performance is no guarantee of future results. As with all investments, portfolios that invest in 130/30 equity strategies have associated inherent risks. Please obtain and review all financial material carefully before investing.