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Team 4+1 Investment Strategy

Team 4+1 Investment Strategy . Entertainment and Leisure Sector. Entertainment and Leisure Sector General Idea. Including: Entertainment, Media, Hotel, Travel, etc. Short-term opportunity: Strong economy, m ore bonus, expected strong growth in entertainment/leisure sector this summer

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Team 4+1 Investment Strategy

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  1. Team 4+1 Investment Strategy Entertainment and Leisure Sector

  2. Entertainment and Leisure SectorGeneral Idea Including: Entertainment, Media, Hotel, Travel, etc. Short-term opportunity: Strong economy, more bonus, expected strong growth in entertainment/leisure sector this summer Long-term: Until the macro indicators show down turn it should show strong growth

  3. Mutual funds investing in this Sector DZL (Leisure/Entertainment Index) PEJ (PowerShares), RYLIX (Rydex), FDLSX (Fidelity), FLISX (Invesco) DZL (Index) PEJ RYLIX S&P500 FLISX FDLSX

  4. Winner: PEJ (PowerShares) • The Fund will normally invest at least 90% of its total assets in common stocks that comprise the DZL Index. • Investment merit criteria including: price momentum, earnings momentum, quality, management action, and value.

  5. PEJ: PowerShares

  6. PEJ: PowerShares

  7. Trading methodology 4+1 • Sectors: • Movie, gaming, tv (content makers and distributors) • Casino, hotel, travel, cruise lines (no airlines, no travel agencies) • Not restaurants and food sector (different from PEJ)

  8. Trading methodology 4+1 • Distribution: • Capital size does not matter • In short term allocate more in travel, hotel, casino sector -- economy is recovering • Long term during economic down turn focus on sectors that attract budget buyer, cheaper content distributor, movies etc. • Value investment P/E lower than 20 in economic down turn go even lower to lower than 15. • # of total holdings 10 maximum

  9. Parameters • Finviz: • Sectors we are analyzing total (126) • Entertainment Diversified (13) • Gaming Activities (10) • General Entertainment (6) • Lodging (14) • Movie Production theater (9) • Multimedia Graphics Software (20) • REIT hotel/motel (16) • Resort, Casino (23) • Broadcasting (15)

  10. Parameters Continued • Finviz: • Low P/E (<20) value investing • Currently 40 companies that meets this criteria • News of mergers, new products, good or bad press, news related to expected box office sales • Our sector related general news • Sweeps and box office results • Evaluate growth strategies and general management • Name brand recognition (esp hotel, lodging sector) • This year we will look at Q3 earning reports • Sell stock when they go above the P/E threshold or other management issues makes it unattractive

  11. Movies, TV, Games • Movies: Box office • TV: Sweeps • Games: #units sold • Growth compared to last year • Competitive comparison • Franchising potential • Online review sites

  12. Casinos, Hotels, Cruise lines • Brand recognition • Expansion-new ventures

  13. Companies we currently pick • DIS (Disney Company) • STARZA(Starz) • BYI(Bally) • SIX (Six Flags) • IHG (Intercontinental) • LGF (Lions Gate) • IGT (International Game Technology) • CNTY (Century Casinos)

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