Purdue student trades for his tuition
Glen Bradford’s investment strategy pays off
By SUPRIYA SINHABABU
Tribune Staff Writer
Across the bottom of Glen Bradford’s Web page are the words, “The greatest risk is not taking one.”
It’s not an empty aphorism for Bradford, an industrial engineering major embracing his fourth year at Purdue University. For the past month, Bradford has risked $37,300 on the stock market to pay his tuition.
Fortunately for Bradford, he has been winning.
“After I made my first grand, I started investing $16,000 of my dad’s money,” Bradford said recently. “And so far, I’ve made about $6,000 in my account, and $3,000 in his account, and that’s over the course of three or four weeks.”
Bradford is no stranger to the stock market. The 21-year- old has already racked up nearly a decade’s worth of investment experience.
“I probably started at age 12,” Bradford said. “My dad set up a Unified Gift to Minors Act account, which basically enables you to invest if you’re under 18.”
First he tried investing in a stock his grandfather recommended. The company soon went bankrupt. He tried his mother’s pick as well. That went bankrupt, too.
“At that point, I learned that you shouldn’t take other people’s advice without looking into it,” Bradford said. “Now I pretty much do everything myself.”
Bradford became more intensely interested in trading as a junior at Penn High School. His mentor, Doug Hall, an engineer at Honeywell Aerospace, helped introduce him to the strategies of investment masterminds such as Warren Buffet and Benjamin Graham.
While it helped to have the examples of big-name market geniuses as a guide, it took Bradford some time to learn how to capitalize on their wisdom.
“On Christmas, my freshman year of college, I just sat down, tried to program it all out,” Bradford said. “I failed the first time, and everything just fell apart and was useless.”
After coming up with his latest strategy, however, Bradford knew he was on to something.
“For about four or five days I pulled out of everything I was in and bought into my new strategy,” he said.
As he summarizes on his Web site, Bradford’s strategy for beating the market is “buying undervalued, fundamentally strong companies with growth potential.”
Putting the strategy into action is a research-intensive process. First, Bradford searches the internet and magazines for companies declared to be “high growth.” He calculates the growth rate and prices the company.
Then he meditates over a number of statistics, including the company’s trading volumes, inside shareholder action, cash flow and debt.
“And then if I like it, I put my money where my mouth is and I allocate my portfolio so the ones I like the most are the ones I buy the most of,” Bradford said.
So far, the strategy has seemed to work. Bradford said his biggest holding, VSE Corp., had gone up by 50 percent in three weeks.
But trading stocks isn’t Bradford’s only outlet for his investment savvy.
Jim Cramer, host of CNBC’s Mad Money and co-founder of the financial Web site TheStreet.com, took an interest in Bradford’s strategy while e-mailing back and forth with him recently.
When Cramer asked to see a sample of his writing, Bradford quickly churned out an article titled, “16 Stocks That Are Paying My College Tuition” for the financial Web site, SeekingAlpha.com.
“I sat down for 10 or 15 minutes, because that’s all I really needed to explain my picks,” Bradford said.
The article was enough to impress Cramer.
“Man, this is good,” he wrote in an e-mail to Bradford on Aug. 11, the day the article was posted.
Cramer put him in touch with James Altucher, chief executive of a site in the TheStreet.com’s network called Stockpickr.com. Bradford’s first article there, titled “Three Stocks That Could Double,” has drawn more than 63,000 views.
Bradford said he did not know quite what to make of the attention from big names like Cramer.
“He must have really liked my companies,” Bradford said.
The research hours Bradford has logged also set him apart from the average investor.
“Two or three weekends ago, I sat down and I put in 30 hours of straight reading books and going through my companies,” he said. “I’ll sort through like 500 or 600 companies a weekend.”
Though he enjoys sharing his insights on Stockpickr.com, Bradford said he does not want to make a career out of financial writing. After finishing up his undergraduate degree and the MBA classes he planned to start this fall, he hopes for a future in investment analysis or mutual fund management.
For now, however, Bradford dispenses his advice to friends, free of charge.
“They pretty much ask what I think they should buy,” he said. “If they have balls they buy it, and if they don’t, they watch it go up.”
Staff writer Supriya Sinhababu:
sinhasu@sbtinfo.com
September 2, 2008