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To: Mike Sawyer who wrote (5614)	5/22/1998 7:03:00 PM
From: Robert Morris	Respond to of 62552

Here's a good one comparing letters from Penthouse and NASA using conventional mutual fund analysis From: globefund.com ..... Management style can explain the vast difference in performance between the hundreds of mutual funds that invest in essentially the same three hundred stocks of the TSE index. A good analogy for this type of diversification is to consider two documents. The first is a letter to Penthouse Forum and the second is a thesis on advanced rocket propulsion for NASA. They may be similar in length and even have the same publisher (since the same people publish Omni and Penthouse). However, the style they are written in and the use they make of identical words would vary greatly. In comparing these two documents using conventional mutual fund analysis, we would see many of the same words. For example, the word 'the' may make up 8 per cent of both documents. Or, consider the two documents by their top five word 'holdings': Word Penthouse NASA thrust 5% 5% extension 3% 3% rear entry 1% 2% after-burn 3% 1% payload 1% 4% To extend the analogy, there is little 'asset' diversification and no geographic diversity. But there is no question that one of these documents would be very appropriate for a certain group of people and the other would be completely unsuitable. Yet the percentage of each word they use is very similar. ...........