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Strategies & Market Trends : Future Schlock!!!!

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From: gcrispin9/9/2006 12:06:09 AM
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I like your previous post TD. Here is my selection for a future trend. Below are the first three paragraphs to the article I have linked.

College education costs are rising at a faster rate than household income, creating funding challenges for students but opportunities for investors.

Average tuition and fees rose 51% at public four-year colleges and universities, and 36% at private four-year colleges during the 10 years ending with the 2004-2005 school year, according to The College Board, a not-for-profit membership organization based in New York.

Household income grew much more slowly, just 9.5% for the 10 years ending in 2003, according to The Center for American Progress, a non-partisan research organization in Washington, D.C.

My favorite way to play this trend is through First Marblehead. The company securitizes private loans using a proprietary database that provides historical data going back 25+years. The company continues to grow and defy analysts who have been skeptical about its future prospects. It's recent securitization again surprised analysts as they thought its recent deal with Bank of America would reduce margins.

I sold half my position at 50, but still hold a thousand shares with an average price of 21. I plan to continue to hold these shares as I believe the company's ability to profit from the student loan business will continue.

findarticles.com
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