Last week’s answer

I was launched in 1869 in New York by a German immigrant and his son-in-law. After many years of being one of America’s largest private companies, I went public in 1999. I’ve helped myriad companies raise capital in debt and equity markets, and have taken public firms such as Sears, Merck and Ford. I began recruiting MBAs in the 1920s and am one of the most sought-after employers by today’s MBA classes. I ended 2002 with about $350 billion in assets under management and revenues of about $14 billion. Who am I? (Answer: Goldman Sachs)

Oil-slick brochure

When I started out in the investing world, I did something really stupid. I took the advice of a glossy brochure that arrived in the mail. It touted the strong demand for oil and recommended a company poised to deliver. I purchased 200 shares for $4 a share. I watched as the stock rose month by month and patted myself on the back. At $8 a share I felt quite smug. A year later, I’m looking at a stock that’s barely worth 10 cents a share. This taught me to study the product, study the market, and use “stop loss” sales orders if a stock climbs too far too fast. I now use investment brochures to heat my home in the winter. — James Hargreaves, Antioch, Calif.

The Fool Responds: If a company’s stock is so uncompelling on its own that someone has to try to sell it via a brochure, that’s a red flag. So is a stock price under $5 per share, suggesting a volatile penny stock. “Stop loss” orders, triggering sales on price drops, can keep you from losing too much, but they can also sell you out of a good stock that temporarily falls.