Mutual Funds  |  OCT 2001

Working Money: Little Steps = Big Returns by Paul Merriman

Working Money: Little Steps = Big Returns by Paul Merriman Increase your profits by investing in specific sectors of the market. Don’t put all your eggs in one basket” is frequently given advice. In the investment world, this adage is about the risk of investing exclusively in one kind of financial product. But it refers to more than just investing among different asset classes such as stocks, bonds, and cash. Two of the most common methods of slicing and dicing the market are based on the size of the company (small cap, mid cap, or large cap) and its popularity (growth means popular and pricey, value means unpopular companies at supposedly bargain prices). Another way to diversify is to divide the market along industry lines or sectors by investing in sector funds or mutual funds that specialize in specific industries.

by Paul Merriman