Euro vs Contrafund, or how to buy a glider (affordably)

On Nov. 15, 2004 I posted a message suggesting that you invest your
money in a mutual fund with an excellent track record (i.e. Fidelity
Contrafund) and wait until your $70K initial investment grows to match
the current price of the glider. Here is an update on that strategy:

Euro: $1.2944 (11/15/04)
$1.3165 (3/20/05)
1.7%

FCNTX: $54.79 (11/15/04)
$57.19 (3/20/05)
4.4%

Contrafund has out paced the Euro by a factor of over 2.5. So far the
strategy is working.

Tom Seim
Richland, WA

snip..

Euro: $1.2944 (11/15/04)
$1.3165 (3/20/05)
1.7%

FCNTX: $54.79 (11/15/04)
$57.19 (3/20/05)
4.4%

Contrafund has out paced the Euro by a factor of over 2.5. So far the
strategy is working.


With the Euro predicted to rise back to 1.35 in the next six months to
a year (which is pretty much where it was just a few days ago) and a
historic annual return of FCNTX of 1.75%, I'm not so sure of the return
provided by your strategy, especially after taking into account buying,
selling and admin fees for the account. These could easily eat up the
2.5% or so you are winning at the moment.

Still, being ahead is always good!

Report back in six months.

Mike


ASW 20 WA

Mike the Strike wrote:
snip..

Euro: $1.2944 (11/15/04)
$1.3165 (3/20/05)
1.7%

FCNTX: $54.79 (11/15/04)
$57.19 (3/20/05)
4.4%

Contrafund has out paced the Euro by a factor of over 2.5. So far
the
strategy is working.


With the Euro predicted to rise back to 1.35 in the next six months
to
a year (which is pretty much where it was just a few days ago) and a
historic annual return of FCNTX of 1.75%, I'm not so sure of the
return
provided by your strategy, especially after taking into account
buying,
selling and admin fees for the account. These could easily eat up
the
2.5% or so you are winning at the moment.

Still, being ahead is always good!

Report back in six months.

Mike


ASW 20 WA

The Contrafund is no-load and the rate of return includes all admin
fees, so this is a real rate of return (unless you trade in less than
90 days from purchase). Predicting future exchange rates accurately
will make you a multi-millionaire, eliminating the need for this
strategy altogether.

Tom