“Misplaced modifier” is one of those fancy phrases that most people have heard of but aren’t really sure what it means. A modifier–or descriptive phrase–is misplaced when it’s sitting next to a noun it doesn’t describe.
Misplaced modifiers can be rampant in financial writing, most commonly when investment analysts are describing stocks.
In my client’s letters, it looks like this:
“Trading at 10x EPS and maintaining a great balance sheet, we think that Company X is a great value.”
The way this sentence is written, “trading at 10x EPS and maintaining a great balance sheet” actually describes “we,” not “Company X,” as the author clearly intended.
HOW DO YOU FIX THIS?
If you don’t have to worry about compliance issues, you could write, “Trading at 10x EPS and maintaining a great balance sheet, Company X is a great value.”
But most lawyers would strike that sentence with self-righteous fury. You can’t claim that something is a great value. You must indicate that this is only what you believe; you might after all be wrong.
So, what can you do?
You have to hedge on the definitiveness of your statement of value. I usually recommend something along these lines.
“Trading at 10x EPS and maintaining a great balance sheet, Company X appears an attractive opportunity.”
“Trading at 10x EPS and maintaining a great balance sheet, Company X offers compelling value in our view.”
You might think, “Seriously? Who would every think ‘we’ are ‘trading at 10x EPS’?”
Perhaps. But I’ve seen my fair share of sentences like this:
“Led by an excellent management team, we think Company X offers an attractive value.”
In this sentence you can see how the ambiguity becomes more problematic, and the more complex your sentences are, the most likely your readers are to be unsure.
Remember to put the descriptive phrase next to the noun that it is meant to describe.