Mix it up.Maximize your returns by investing in blend mutual funds If you work with a financial advisor, chances are you have a "style-specific" investment strategy. That is, you probably were advised to hold X% of your portfolio in large-cap growth funds, Y% in large-cap value funds, Z% in small-cap growth funds, and so forth. The reason: Investment styles go in and out of fashion, and if you hold a mix of funds, you're more likely to participate in Wall Street's flavor of the month flavor of the month n. Something currently popular; a trend or fashion. fla  vor-of-the-month ."Choosing style-specific funds allows you to have experts in both value and growth investing Growth Investing A strategy whereby an investor seeks out stocks with what they deem good growth potential. In most cases a growth stock is defined as a company whose earnings are expected to grow at an above-average rate than its industry or the overall market. working for you" says Mark Mullin, chief investment officer at Diversified Investment Advisors History Established as a division of the original MONY (Mutual of NY) and its predecessors, it spun off as a separate entity in the early 1990s. DIA has over 50 years of multi-product, retirement services only industry experience. in Purchase, New York Purchase, New York is a hamlet of the town of Harrison, in Westchester County. Its Zip code is 10577. Purchase is home to Purchase College, which is part of the State University of New York system, Manhattanville College, a private liberal arts college, and the headquarters . "It's very difficult to find a manager who can do both:" Nevertheless, not every mutual fund is style-specific. If you structure your portfolio relying solely upon growth funds and value funds, you're eliminating hundreds of funds, including some very good ones. Understand the ground rules before you play the game. If a fund holds stocks with relatively low price-to-earnings (P/E P/E See: Price/earnings ratio ) and price-to-book value (P/B P/B See: Price to book ratio ) ratios, it holds relatively cheap stocks. Thus, ifs a value fund, according to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. the Chicago-based mutual fund rating service Morningstar Inc. Those that prefer companies with high P/E and P/B ratios are growth funds. However, not every fund is clearly a growth or a value one. Fidelity Magellan (FMAGX), for example, includes both Cisco Systems “Cisco” redirects here. For other uses, see Cisco (disambiguation). Cisco System,Inc. (NASDAQ: CSCO, HKSE: 4333 ) is an American multinational corporation with 54,000 employees and annual revenue of US $28.48 billion as of 2006. (with a P/E higher than 130) and Citigroup (with a P/E lower than 20) among its top holdings. Funds such as Fidelity Magellan, which don't tilt in either direction, are called "blend" funds by Morningstar, or are denoted "core" funds by Lipper Inc., a New York-based firm that also rates mutual funds. Among the 6,048 domestic stock funds, 1,511 are in the blend category. If your advisor limits you to growth and value funds, you are putting 30% of all funds off-limits. Skipping skip v. skipped, skip·ping, skips v.intr. 1. a. To move by hopping on one foot and then the other. b. To leap lightly about. 2. the "blend" box may be shortsighted short·sight·ed adj. 1. Nearsighted; myopic. 2. Lacking foresight. short sight when looking for Looking forIn the context of general equities, this describing a buy interest in which a dealer is asked to offer stock, often involving a capital commitment. Antithesis of in touch with. value funds. Many value managers are wary of investing in depressed stocks without any visible prospects for a turnaround Turnaround A situation where a company that has had poor performance for an extended period of time experiences a positive reversal. Notes: A speculator may profit from a turnaround if he or she accurately anticipates the improvement of a poorly performing company. , says Amy Arnott, an equity analyst at Morningstar. "They often use screens that rule out hundreds of low-priced stocks. Even if such funds' valuations are lower than the norm, they may not be low enough to qualify for the value box," she says. Rising stock prices may move a fund's P/E and P/B ratios out of the value category and into the blend category. "An absolute commitment to style purity Purity: see Pearl, The. Purity See also Modesty. almond symbol of the Virgin Mary’s innocence. [O.T.: Numbers 17: 1–11; Art: Hall, 14] crystal its transparency symbolizes pureness. may mean selling funds that have histories of success and perhaps paying hefty heft·y adj. heft·i·er, heft·i·est 1. Of considerable weight; heavy. 2. Rugged and powerful. See Synonyms at heavy. 3. capital gains taxes," says Eleanore Szymanski, a financial planner Financial Planner A qualified investment professional who assists individuals and corporations meet their long-term financial objectives by analyzing the client's status and setting a program to achieve these goals. in Princeton, New Jersey
Princeton, New Jersey is located in Mercer County, New Jersey, United States. Princeton University has been sited in the town since 1756. . Therefore, your investment plan should involve some flexibility; you needn't exclude all "blend" funds and you need-fit sell any style-specific funds you hold. TOP 5 LARGE BLEND FUNDS Blend Fund A mutual fund composed of various asset classes (such as stocks, bonds and money market securities), allowing investors to diversify their holdings by owning just a single fund. Also called "hybrid funds".
Year-to-Date 1-Year Ann.
Fund Name (Ticker) Total Return(*) Total Return
Buffalo Equity (BUFEX) 21.78% 30.63%
Elite Growth & Income (ELGIX) 21.74 26.91
AFBA Five Star Equity (AFBEX) 21.48 29.66
WesMark Growth (WMKGX) 20.23 29.88
Thompson Plumb Growth (THPGX) 18.43 23.81
3-Year Ann. 5-Year Ann.
Fund Name (Ticker) Total Return Total Return
Buffalo Equity (BUFEX) 16.62 21.91%
Elite Growth & Income (ELGIX) 8.89 16.43
AFBA Five Star Equity (AFBEX) 13.96 N/A
WesMark Growth (WMKGX) 25.06 N/A
Thompson Plumb Growth (THPGX) 16.59 22.82
Toll-Free Minimum
Fund Name (Ticker) Number Initial
Investment
Buffalo Equity (BUFEX) 800-492-8332 2,500
Elite Growth & Income (ELGIX) 800-423-1068 10,000
AFBA Five Star Equity (AFBEX) 800-243-9865 500
WesMark Growth (WMKGX) 800-368-3369 1,000
Thompson Plumb Growth (THPGX) 800-999-0887 1,000
(*) Return as of 10/31/00 Source: Morningstar Inc. TOP FIVE MIDCAP mid·cap adj. 1. Or or relating to corporations whose retained earnings and outstanding shares of common stock have a value between those of small cap companies and large cap corporations. 2. BLEND FUNDS
Year-to-Date 1-Year Ann.
Fund Name (Ticker) Total Return(*) Total Return
Franklin U.S. Long-Short
(FUSLX) 46.93% 77.51%
Papp Small & Mid-Cap Growth
(M$-GIC) 34.08 57.59
The Fairholme Fund (FAIRX) 27.91 N/A
Fidelity Asset Manager: Aggr
(FAMRX) 23.64 42.03
Style Select Focused Val A
(SFVAX) 23.56 30.08
3-Year Ann. 5-Year Ann.
Fund Name (Ticker) Total Return Total Return
Franklin U.S. Long-Short
(FUSLX) N/A N/A
Papp Small & Mid-Cap Growth
(M$-GIC) N/A N/A
The Fairholme Fund (FAIRX) N/A N/A
Fidelity Asset Manager: Aggr
(FAMRX) N/A N/A
Style Select Focused Val A
(SFVAX) N/A N/A
Minimum
Toll-Free Initial
Fund Name (Ticker) Number Investment
Franklin U.S. Long-Short
(FUSLX) 800-342-5236 $1,000
Papp Small & Mid-Cap Growth
(M$-GIC) 800-421-4004 5,000
The Fairholme Fund (FAIRX) 800-324-7465 2,500
Fidelity Asset Manager: Aggr
(FAMRX) 800-544-6666 2,500
Style Select Focused Val A
(SFVAX) 800-858-8850 500
(*) Return as of 10/31/00 Source: Morningstar Inc. TOP FIVE SMALL BLEND FUNDS
Year-to-Date 1-Year Ann.
Fund Name (Ticker) Total Return(*) Total Return
New Alternatives (NALFX) 59.83% 63.88%
Sentinel Small Company A
(SAGWX) 37.38 58.14
Buffalo Small Cap (BUFSX) 30.02 57.58
PBHG Small Capvalue (PBSVX) 27.99 51.16
Meridian Value (MVALX) 27.14 43.38
3-Year Ann. 5-Year Ann.
Fund Name (Ticker) Total Return Total Return
New Alternatives (NALFX) 16.78 15.77
Sentinel Small Company A
(SAGWX) 20.12 21.6
Buffalo Small Cap (BUFSX) N/A N/A
PBHG Small Cap Value (PBSVX) 16.29 N/A
Meridian Value (MVALX) 25.83 29.41
Minimum
Toll-Free Initial
Fund Name (Ticker) Number Investment
New Alternatives (NALFX) 800-423-8383 $2,500
Sentinel Small Company A
(SAGWX) 800-282-3863 1,000
Buffalo Small Cap (BUFSX) 800-402-8332 2,500
PBHG Small Cap Value (PBSVX) 800-433-0051 2,500
Meridian Value (MVALX) 800-446-6662 1,000
(*) Return as of 10/31/00 Source: Morningstar Inc. |
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