This week's selloff may or may not be the start of a market slide, but the Dow Jones Industrial Average is still trading near its all-time highs - a strong argument for the National Association of Investors Corp.'s "Own Your Share of America" campaign that kicked off June 1, the day the DJIA broke the 3400 barrier for the first time.
NAIC chairman Thomas E. O'Hara said this month's program, sponsored by the NAIC and 150 of the nation's top corporations, is an attempt to introduce those who have never invested in anything more exotic than savings accounts or CDs to put a portion of their savings into common stocks."It's easy, profitable and beneficial to the economy," said O'Hara.
Michael R. Quinlan, chairman of McDonald's Corp. - the single most popular stock among individual investors - is also chairman of the Own Your Share campaign. He advises those who have been sitting on the sidelines, undecided about whether stocks are too risky, to go ahead and take the plunge - or at least put their toe in the water.
"It's not important that you invest a large sum of money at once, but it is important to begin a regular investment program consistent with your long-term financial goals," said Quinlan in a news release. "I encourage everyone to begin investing in stocks today, not tomorrow."
The Own Your Share program is not new. Similar campaigns were undertaken in the 1950s and early '60s with the result that the number of individual shareholders nationwide increased from 6.5 million to 20 million.
O'Hara believes the drop in individual investment in the markets over the past decade means it is once again time to tout the benefits of patient, long-term purchase of shares.
In 1980, 71 percent of all corporate stock was held by individuals, as opposed to mutual funds, pension funds and other such large investors. By the end of last year, individual investors' portion had dropped to 54 percent.
O'Hara said that, over long periods of time, common stocks have provided higher returns than most other forms of investment, including gold and real estate. Despite ample evidence of the proof of that allegation, many Americans have never become stock investors. He believes many avoid the markets because they don't understand it.
"They don't know how to research a company or obtain its annual report. It's all a big mystery."
That's where NAIC, a national, not-for-profit volunteer organization of investment clubs and individual investors comes in. It currently has 150,000 members who invest an average of $30 per month in stocks.
Last month NAIC polled its individual members to determine their favorite stocks. Led by McDonald's, the top 10 included such stalwarts as Kellogg Co. (No. 5), Dow Chemical Co. (No. 7) and Walt Disney Co. (No. 10). Respondents to the poll ranged in age from their early 20s to late 70s. Many said their investments helped them save for retirement, put their children through college and cope with emergencies.
For more information on joining the NAIC as an individual investor or on joining or forming an investment club, write to NAIC 1515 East Eleven Mile Road, Royal Oak, MI 48067.