Suppose you've recently hit a good inheritance and now want to invest in the stock of a company that owns or is buying a major league sports team. Last I heard there were some 15 teams up for sale including the Los Angeles Dodgers and three Time-Warner-owned franchises in Atlanta: Braves, Hawks, Thrashers.

Want a tip? Go easy here.

The first order of business is to see who is doing the buying. Generally, if a public company or the CEO of that company is acquiring a pro team, you might want to consider keeping your money at home--at least as far as buying any of its stock is concerned. Just look at what's happened recently.

According to figures supplied by FT Interactive Data and Forbes, the American Financial Group bought the Cincinnati Reds baseball club in April of 1999. The change in the stock price four years later from purchase shows a negative 53%. AOL Time Warner took over the Washington Capitals hockey team in June of 1999 and four years later, the stock price change from purchase dropped 78%.

Here's another one. Brocade bought the San Jose Sharks hockey team just last year and the change in stock price from purchase dropped an astounding 78%. Even Rogers Communications, which acquired baseball's Toronto Blue Jays in December of 2000, fell by 23%.

Closer to home, Computer Associates bought the New York Islanders hockey franchise in April of 2000 and three years later it showed a negative 75%.

In fact, five of eight companies that purchased teams in the last five years have suffered enormous stock price declines that were even lower than the market's overall decline.

Now, you'll notice one thing about the figures thrown at you. I've purposely excluded NFL teams simply because they benefit from revenue sharing and extremely lucrative television rights.

Of course, is there any connection between sports and stocks anyway? Take a look at the Cincinnati Reds. Carl Lindner, CEO of the American Financial Group, which has a big slice of the baseball team, says there is no connection whatsoever. Maybe and maybe not. However, consider the season the Reds are having.

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