Saturday, May 03, 2008

Morningstar praises Putnam's "plain English" and provides tips so you can write in "plain English," too

Writing in "plain English" is easier said than done. So I was intrigued when Morningstar singled out Putnam for "plain English" prospectuses in "Letter to SEC: Short Fund Prospectus Helps Shareholders."

For example, the author liked this description of Putnam Voyager's strategy: "We invest mainly in common stocks of U.S. companies, with a focus on growth stocks. Growth stocks are issued by companies that we believe are fast-growing and whose earnings we believe are likely to increase over time."

Here are some "plain English" writing tips I extracted from the Morningstar article:
  1. Get specific about strategy. Instead of describing your investment objective using terms like "capital appreciation" that don't mean a lot to ordinary folk, get specific about "the types of securities the fund usually owns and the criteria a fund manager uses when buying and selling securities."
  2. Use graphs.
  3. Put returns in context by comparing them with the fund's benchmark. Don't make your readers struggle to understand returns without any basis for comparison.
Susan B. Weiner, CFA
Investment Writing
Writing that's an investment in your success

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