To help explain the intricacies of options trading to investors, Kelmoore Investment Co. of Palo Alto, Calif., has turned to a portly man who wears a face mask, a skin-tight yellow leotard and a hat with a little, glowing antenna poking out of the top.

No kidding.

The firm launched a promotional comic book, called The Adventures of Kaptain Kelmoore, in late April. In the book's first issue, the superhero, with his giant cleft chin and a Kelmoore logo emblazoned across his chest, explains the difference between a call and a put to Jane, a "hapless investor" who is confused about options investing.

The book is frivolously splashed with lots of color and strange characters such as Monsieur Put, a walking string of the letters "P-U-T' who speaks in a French accent. Acting as a straight man, Kaptain Kelmoore decries dry lines such as, "Buying a put is a bearish strategy, meaning you think a [stock's] market value is going to go down. It is used to lock in a price for a specific equity."

It's not exactly your typical mutual fund marketing campaign, but it isn't supposed to be, said Tamara Heiman who, as director of marketing for Kelmoore, helped develop the comic.

A Diversion From the Market

"At times like this, when the market's bad, you need something entertaining to keep you going," she said. "It's fun and it's new."

Kelmoore, with about $400 million in assets, offers three funds: an aggressive tech product called the Kelmoore Strategy Eagle Fund, a conservative fund that uses a put strategy called the Kelmoore Strategy Liberty Fund, and its flagship Kelmoore Strategy Fund, which generates income with covered options.

Year-to-date through June 19, the Strategy Eagle Fund is down 26.9%, according to Morningstar of Chicago. The fund declined 33.9% in 2001, its first year of inception. Year-to-date, the Strategy Liberty Fund is down 21.3%, after falling 10.1% in 2001. The flagship Strategy Fund is down 19.2% year-to-date, after declining 13.1% in 2001 and falling 14.5% in 2000.

Heiman developed the book with her brother, Josh Heiman, an avid comic fan who works in Kelmoore's compliance department and wrote the dialog for the comic. He partnered with an artist to create the final product.

The Adventures of Kaptain Kelmoore is intended for just about any reader, even children, Tamara Heiman said. However, she conceded getting kids to read a comic book about options might be a tough sell. "I don't think that they really care about the options," she said. "They're just looking at the pictures."

The book had its genesis in a series of electronic greeting cards that the firm created to send to brokers and investors. The cards, which Kelmoore sends as a way of thanking them for their interest in the firm, began featuring Kaptain Kelmoore about a year ago, she said. Eventually, the Heiman siblings decided to build a comic around the character.

"Basically, we were looking to have a comic book that brokers or clients would want to have around the house," she said. "It's really just about making it easy to understand. There are a lot of sophisticated investors out there, but for them options are always such a scary thing."

She said the book has been well received among the brokers who distribute Kelmoore's products. Some asked for copies to take to trade shows. Others asked for additional issues to distribute among their clients. Kelmoore printed about 10,000 copies of the book and has distributed 5,000 so far, Tamara said.

A Laughing Matter?

Still, some marketing executives said Kaptain Kelmoore is an example of a creative brainstorm applied to the wrong market.

"I applaud their creativity, but this might be too far down that path," said Jim Atkinson, a principal at Orbis Marketing Group of Los Angeles, a mutual fund consulting firm.

"I think creativity generally is a good thing. Occasionally I come up with ideas that are fun and creative," he continued. "But you've got to say to yourself sometimes, This is people's money. It needs to be taken seriously.'"

"I hope they haven't shot themselves in the foot," said Lisa Cohen, a principal with the Medfield, Mass., marketing and sales consulting firm The Collaborative.

The comic "won't help them be taken as seriously as perhaps they would like," she said. "If I were considering a complicated, risky investment strategy, I don't know that I would feel very comfortable with this. There's a fine line between interesting and insulting."

Cohen said she has seen strategies like this before. She pointed to the example of MetLife of New York, which for years used the late Charles Schultz's Peanuts characters to market its products. MetLife TV ads featuring the characters are now scant, but Snoopy still adorns the firm's Web site.

In addition, Cohen, who is helping organize a workshop for female investors scheduled for this week, said it might be insulting to some women that the secondary character in the comic is a woman. She said it might appear that "the function of Kaptain Kelmoore is to explain options to women, whereas men need some other literary form."

Heiman conceded that the comic "is not going to work for every single broker or every client."

"But nothing works for everybody," she continued. "It was really inexpensive. It worked."

Josh Heiman is currently working on the comic's second issue and his sister said she would like to continue producing the book as long as there is interest.

"There are so many topics out there," she said. "When you look at the topics the Investment Company Institute [covers] and all the educational materials out there," there are many other subjects that would make for interesting comic book themes.

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