Comfort Zone Investing

Build Wealth and Sleep Well at Night

Ted Allrich

St. Martin's Press

Chapter One
 
Using Mutual Funds
 
Money is better than poverty, if only for financial reasons.
 
—Woody Allen
 
Money. It’s what we all want, and need—for so many different reasons. Once we’ve got the basic necessities covered, we have to provide for the future, for ourselves and our children. In order to do that, we have many investment choices. Too many. Some are very risky. Some aren’t. Some work better for older investors, some for younger ones.
 
That’s what makes investors nervous. They don’t know which investments are right for them. Or they don’t know about all the choices. Or they don’t understand how investing really works.
 
This book will change all that. After you’ve read it, you’ll have more knowledge about investing than anyone but the investment pros. Later in the book, I’ll even share some of their intelligence so you can use it. You’ll reach a new level of understanding about stocks, mutual funds, and bonds. You’ll also understand what makes markets move. You’ll be much more educated about the ways of the investing world and how to exploit its many facets. You’ll choose the right investments for your goals. You’ll enter into your own Comfort Zone.
 
A good way to start is by hiring a professional, someone who will manage your money while you learn more about investing. You think you don’t have enough money for a pro? You’re wrong. You can do it by using mutual funds.
 
Mutual funds are the luxury limos for cruising to your Comfort Zone. They offer professional management and diversification. They can help fill a portfolio with specialized investments that are well beyond the average investor’s understanding. I’m a big fan of mutual funds and encourage you to start your investing with them.
 
In this chapter, you’ll see reference to a Core Portfolio. Chapter 6 is dedicated to building this important component of Comfort Zone investing.
 
Types of Mutual Funds
 
There are open-end funds, closed-end funds, and exchange-traded funds. Each has unique attributes, but they all have certain commonalities:
 
 1. A fund offers certain types of investments, articulated in its prospectus. You should always read the prospectus of any fund in which you have an interest before you invest in it. The prospectus tells you everything about the fund, such as the fees it charges, the investments it makes, the tenure of the management, etc. These are all important things to know before you send in your money. Most prospectuses are summarized online at the fund’s Web site and/or on a Web site like Morningstar (www.morningstar.com). Every fund will send a prospectus upon request.
 
 2. All funds work like this: They gather money from many individuals, pool it together, and then buy stocks and/or bonds in specific ways that are described in the fund’s prospectus. In other words, you are putting your money in with that of many other investors to take advantage of the expertise of the fund’s managers, as well as the efficiencies that larger holdings of equities or bonds will give.
 
 3. There are funds for almost every investment imaginable. Funds range from investing in large stocks to buying gold to investing in foreign bonds to buying U.S. Treasuries. There is no end to the selection of funds. That’s why they’re the best way to get started in general or within an industry. You can buy the fund while you continue learning, and eventually choose and buy specific stocks when you feel you know enough.
 
 4. Mutual funds can be bought directly from the funds themselves, either through a Web site, or by mailing in the money, or delivering it in person, or through brokers. Funds that are traded on exchanges (exchange-traded funds or closed-end funds—both explained later) are bought through a broker because they trade like stocks.
 
 5. Fees. There are a number of possible fees that must be disclosed in the prospectus of a fund. Here is a list of the most common ones. It’s rare that a fund will charge all of these fees but sometimes they do. You don’t want to own those. The fewer the fees, the more of your money goes to work for you.
 
•  Up-front fee or commission or load. This is charged when you buy the fund. If it’s 5%, that means for every $1 you put in, only 95 cents finds its way into the fund. Part of that nickel goes to the people who run the fund and part of it goes to the brokers who sell it.
 
•  Marketing fees (also known as 12b-1 fees). This is a charge many funds have that helps them pay for selling the fund to new investors. The maximum charge allowable is .75% of assets. This is deducted every year from the fund’s total assets, before you would get any of your money back. There are funds that do not charge any marketing fees.
 
•  Management fees. This is how the managers of the fund get paid for managing your money. This is one fee you can’t and shouldn’t avoid. Would you work for free?
 
•  Back-end fees and level loads. Some funds will charge you for leaving. Called a “back-end fee,” this fee is rare, but it is sometimes there. Don’t buy a fund with one of these attached. I can guarantee you there is another fund with performance just as good and no back-end fee. These fees usually decrease over time and almost always are waived after 10 years. Another rare fee is the “level load,” which requires that you pay a certain amount of your return every year. Again, not seen very often, but if it’s in there, you don’t want it.
 
 6. Share classes. Some funds offer three different ways to buy the fund. They use shares designated as “A”, “B,” or “C” class shares. The A-class shares usually have a front-end load. The B shares usually have a back-end load. The C shares have no load but are charged a higher set of annual charges such as the marketing and administration fees. Again, there are plenty of funds that don’t charge any fees for buying or selling them or the fee is so low that it’s not going to noticeably change your wealth. Actively seek these out.
 
 7. Price volatility. Every fund will go up and down in price. That’s because stocks and bonds go up and down in price. The more general the fund, such as Growth and Income, the more the fund will move with the general market. If you own an index fund, it will follow exactly what the index does, the Standard & Poor’s 500 Index, for example. The general funds will have less price volatility than specialized funds, such as gold or biotech or technology. With these funds you don’t get diversification among industries. That’s the very reason you own one. You have a fund that buys many different stocks within one industry. If that industry is having a rough time, suffering from an industry-specific problem, then the fund invested only in that industry is going to have very poor performance. It’s going to suffer and so will you. That’s why industry-specific funds can’t hold more than 5% of your portfolio if you’re going to stay in the Comfort Zone. Just having a fund doesn’t get you away from the volatility of a specific industry. General funds, on the other hand, can give you plenty of diversity and can easily occupy 10% of your portfolio and more if you’re going to start with them.
 
Open-End Mutual Funds
 
The most common mutual fund is known as an open-end fund. The description refers to the fact that it is open to new investors and will take in their money to add to the pool already created by other investors. (When an open-end fund reaches its maximum size, it will be “closed” to outside investors, but this is different from the way a “closed-end fund” works, which I’ll explain next. Very few open-end funds are closed to new investors.)
 
The open-end fund sells shares based on the price at the close of business. It does not trade on an exchange or over the counter. It sells to or buys back its shares from investors directly, though you can place your order through a stock broker or can buy or sell directly with the fund. The price of the fund’s shares is based on the Net Asset Value (NAV), which is determined by adding up the value of the shares and cash in the fund and dividing by the number of shares outstanding. That calculation is done at the close of every business day.
 
When you want to buy or sell an open-end mutual fund, you pay the NAV, plus or minus a broker’s commission, if applicable. Remember, many funds are “no load” funds, meaning there is no up-front charge to buy or when you sell. Some funds even have that arrangement with a broker so all of your money is put to work when you buy it.
 
When you put in your order, you buy it the next day. Your share price is based on the closing price of the day on which you placed your order. In other words, if you buy an open-end fund on Monday, you won’t actually buy it until Tuesday, based on the NAV price of Monday’s close.
 
Open-end funds come in every variety you want. There are index funds, biotech funds, large-cap funds (focusing on large stocks), small-cap funds (smaller companies), mid-cap funds, growth and income funds, etc. You can get a good read on all the types of funds by looking at a mutual fund screening program found on Yahoo!Finance or AOL or MarketWatch or Morningstar. (See Web Sites on page 212 for the links).
 
The screening programs list all the funds in a category with links to a full description of each of them. A good exercise would be to go to Yahoo!Finance now and look at the Mutual Fund resources found under the Mutual Funds headline on the left of the page, then click on Screener.
 
So of all the funds there, which should you buy? Go to the Core Portfolio (chapter 6) for your first one or two choices. On page 11, I describe what to look for in funds. If you want to go beyond the Core Portfolio individual stock needs, and substitute an energy fund for the oil stock that is recommended in the core holdings, that’s a good way to start. After you feel comfortable in stock investing, you can sell that fund and buy the individual oil stocks.
 
You can use funds for almost any of the core holdings, because a mutual fund does a great job of helping an investor get into sectors needed for diversification but may not have the expertise for the individual stocks they want to own. That’s why funds were originally developed: to help the small investor in the stock market.
 
The Closed-End Fund
 
This fund is not “closed” to investors. Rather it is closed at the day it is funded and then trades its shares on an exchange so you can buy and sell the fund like a stock. (A great Web site that goes into many details about closed-end funds (CEF) is www.closed-endfunds.com. Another one is at the Securities and Exchange Commission site: www.sec.gov/answers/mfclose.htm.)
 
The main differences between the closed-end and open-end funds is the way they are priced and traded. I’ve described the calculation for the NAV for open-end funds. The same calculation is used for the NAV for closed-end funds. They trade all day at a premium or a discount to the NAV with their own ticker symbol, on an exchange. It makes them very easy to buy or sell.
 
When a closed-end fund begins its life, it raises money by describing a certain expertise it will provide for investors. It may propose investing in Japanese stocks. If enough investors subscribe to that idea, they give their money to the fund, and the fund closes, working only with the money raised on the initial offering. In other words, the amount of money the fund gets when it starts is all it will have to invest. It is not open-ended. The fund is assigned a ticker symbol and then starts to trade on an exchange.
 
The fund will have a bid and an ask, just like a stock. And here is where closed-end funds get interesting. Sometimes, they trade at a discount to their NAV. Sometimes they trade at a premium. So smart investors can buy $1 worth of the fund for 90 cents or less at times. Or they can sell $1 worth of the fund at $1.10 or higher at times. In other words, these funds don’t trade at their NAVs but instead at a price set by the market, which is sometimes above or below or right at the NAV. How is this possible?
 
It has to do with perceptions of things to come. When investors feel things will continue to get worse, they sell their stocks, even though the price is too far below the real value for the stocks. The same is true for closed-end funds. If investors think the industries or countries that the fund specializes in will be doing poorly in the future, they will sell those funds, no matter the true value of the fund. Sometimes the panic gets so bad that sales are made at 15% to 20% of a discount to the NAV. Other times, when an area is extremely hot, as were Internet funds in the late ’90s, investors get stupid and pay 15% to 20% more than the value of the fund, just so they can get into it. Those hot funds have a way of cooling way off, and cold funds have a way of moving toward their NAV, and below, after reality hits investors.
 
If you think about it, a closed-end fund can always liquidate itself. When it does, the investor would receive the NAV for their shares. So if you buy it for a discount, you have a decent chance of making money, no matter what the fund does. Of course, a discount can always go to a deeper discount. But if you study specific funds and see what their ranges for discounts and premiums have been, you can buy and sell these funds at the right times.
 
Good sources for finding CEFs are the Value Line Investor Survey (www.valueline.com), which is also available in print at your local library or by subscription; Morningstar (www.morningstar.com), also available in print at your local library or by subscription; a general site: www.closed -endfunds.com (note this is a different Web site from one with a very similar URL mentioned earlier in the chapter, www.closed-endfunds.com); and one more: www.site-by-site.com/usa/cef/cef.htm. By looking at these sites, and reading their general articles, then investigating individual CEFs, you’ll get comfortable with this type of fund. They can be incredible bargains and are easily bought and sold. They are well worth your effort.
 
Exchange-Traded Funds (ETFs)
 
An ETF is a specialized closed-end fund introduced on the American Stock Exchange in 1993. As of this writing there are more than $200 billion worth of ETFs and 140 different ones being traded. What’s the distinction between a closed-end fund and an ETF? Very little. But each ETF is created to track an index such as a broad stock or bond market index such as the NASDAQ-100, a stock industry sector, or an international stock market.
 
An ETF trades like a stock, just like a CEF does. You can buy or sell it during the trading day, without waiting for the end of the day to determine the NAV. The NAV for an ETF is always available so you know the discount or premium when you buy or sell it. You pay straight brokerage commissions on each trade. There is no “load” or upfront fees to buy these funds. So if you have a discount brokerage account, you can buy or sell them for a small commission. They also tend to have lower capital gains taxes attached to them because the funds hold their securities longer. For example, if you buy an ETF that tracks the NASDAQ-100, there is no need for the fund to buy or sell the stocks in the index once they have a position in them. When new securities are added or deleted, the fund has to accommodate them, but other than that, the fund doesn’t need to make trades.
 
That also keeps the expenses down for the ETFs. They’re not “actively” managed as other funds are. Since they track an index, they don’t require managers to constantly look to sell overvalued shares or buy undervalued ones. There are also index mutual funds that are not actively managed and have lower expenses.
 
For more information on ETFs, please see these sites. The American Stock Exchange (www.amex.com) and NASDAQ (www.nasdaq.com) both have screens that describe and list ETFs on their sites.
 
ETFs are great for filling the Core Portfolio need for buying an index fund or for a broad investment in the technology industry or other specialty area. You can find a listing of ETFs at the sites above, as well as on Yahoo!Finance (http://finance.yahoo.com/etf); MarketWatch (www.marketwatch.com); or AOL (keyword ETF Center).
 
What to Look for in Funds
 
What you’re looking for in a good mutual fund is strong performance over ten years. Some growth funds, especially those that specialize in smaller companies, do very well during a bull market, then give it all back when the market turns sour. In a ten-year period, a fund will experience both good and bad markets. The funds that do well in both, and by that I mean they don’t lose as much as their competition in bad markets, are the ones you want.
 
The Morningstar system ranks funds with a star system, with five stars as the highest. Just because a fund has five stars does not mean it’s safe. It does mean management has produced good results given the criteria of the fund through good and bad times. Look for five-star funds but know they will still have volatility.
 
The Micro-Cap ETF
 
A type of mutual fund for investing in new companies is called a micro-cap ETF. The micro-cap means extremely small companies, usually having a market cap of $50 million to $500 million. Market cap is short for market capitalization, or the market value of a company, which is calculated by multiplying the number of shares times the market price of a stock. Micro-cap stocks are very small companies, and most of them are new to the public market.
 
A good example of a micro-cap fund is the Barclays Global Investors Fund, which tracks U.S. micro-cap stocks. It has the unusual name of iShares Russell Microcap Index Fund. The ticker symbol is IWC. The fund trades on the New York Stock Exchange, and it tracks the bottom 3% of the U.S. stock market by market capitalization. In other words, most of the smallest stocks that are publicly traded are included. It holds the smallest 1,000 securities in the small-cap Russell 2000 index as well as the next 1,000 stocks below the index, the ones that are too small to be in the Russell 2000. There are no stocks below $1 or stocks that trade only in the “pink sheets,” which are stocks that don’t qualify for listing on the exchanges or the National Association of Securities Dealers Automated Quotes (NASDAQ). These criteria keep out many marginal stocks.
 
There are several other micro-cap funds. Two more are managed by PowerShares Exchange Trust Fund, also known as Zacks Micro Cap Portfolio, which trades on the American Exchange with the symbol of PZI; another is managed by First Trust Advisors (FTACX), traded on Nasdaq. These funds will give you a chance to participate in new companies through another avenue: the exchange-traded fund.
 
Too Much Enthusiasm
 
This is a good time to mention enthusiasm and investing. Usually too much enthusiasm is bad for your wealth. It blurs your reasoning and makes you do things quickly that you can regret for a long time. For example, you may read about an aggressive mutual fund that just reported a year where it made more than 100% on its money. That happens in bull markets. But maybe that fund used leverage—in other words, it borrowed to buy more stock—and had spectacular luck. Or maybe the market was kind and took every stock higher that year. When the market turns south, however, that method of investing is deadly.
 
And often, that’s what happens. A mutual fund that reports a great year usually doesn’t have two of them in a row, because most of the time an investment style doesn’t last very long. As mentioned before, you’re looking for a fund that has shown good performance over several years, preferably ten or more. Don’t buy a fund based on one year’s numbers. It’s almost guaranteed to give some or most of that back in the next. Don’t let your initial euphoria blind you into quickly buying anything. Go after the tried and true, not the hottest fund from last year.
 
International Mutual Funds
 
There are many types of international mutual funds. Some of them invest in a region such as Asia/Pacific. Others invest only in one country, while some fund managers roam the globe looking for great stocks no matter where they’re headquartered.
 
There are some caveats that go with international investing you should keep in mind. There is the usual risk involved in any stock investment, only a little more. That’s because no other country has the advanced capital markets we take for granted here in the United States. We have the Securities and Exchange Commission (SEC) to make sure companies fully disclose all their activities. We have the National Association of Securities Dealers (NASD) to monitor stockbrokers and dealers, to make sure they are dealing honestly with the public.
 
In other economically developed countries there are decent capital markets with safeguards in place but nothing like those in the United States. The less developed countries have less developed capital markets. If you’re buying a fund that specializes in a new market, expect some nasty surprises once in a while.
 
But that’s where the advantages of a mutual fund come in: you have wide diversification because the fund will buy many stocks in the country, and you’ll have professional management. The pros know the dangers that lie beneath the balance sheets.
 
One of my friends was a manager for a large international fund specializing in South America. He said the way he started to find companies to invest in was to ask his contacts in a country which businesses were honest. That one criterion helped him avoid many, but not all, problems.
 
If you’re going to try to pick individual stocks in foreign countries trading on foreign exchanges, you’ll find it very difficult to get timely information. Many of the companies are only required to report once a year. By the time you receive an annual report it will be history you’re reading, not current business.
 
Another concern is currency risk. Your returns will be helped or hurt by what the dollar does. Investing in foreign stocks means you have to buy them in foreign currencies. If the dollar strengthens against the currency, you can lose some or all of your profits when you sell the stock and turn those proceeds into dollars. If you have a loss from the investment, the currency hit only pours salt in the wound. One-country mutual funds carry extreme currency risk.
 
Where to Find International Funds
 
There are many good screening programs on the Web that can help you find international or country-specific mutual funds.
 
To find a fund, click on one option in each box. Following is an example for finding a good international fund using Yahoo!Finance: http://screen.yahoo.com/funds.html.
 
Category: Any International Stock Fund
 
Fund Family: Any
 
Rank in Category: Top 30%. (You don’t want only the best 10%. Remember what’s hot last year, most likely isn’t this year.)
 
Manager Tenure: Longer than 10 years. You want someone with plenty of experience at the helm.
 
Ratings: Minimum 4 stars, maximum 5 stars. (This is on the Morningstar scale where 5 is the best.)
 
Return Rating: “Minimum Average,” “Maximum Above Average.” (Again, Morningstar ratings and you don’t want the “High” return because that’s where the most risk is.)
 
Risk Rating: “Minimum Below Average,” “Maximum Average.” (We’re looking for the Comfort Zone, not the highest risk.)
 
Performance Returns: YTD (means Year to Date) Up more than 0%
 
1-Year Return: Up More Than 5%.
 
3-Year Return Annualized: More Than 10%
 
5-Year Return Annualized: More Than 15%
 
Minimum Initial Investment: Less than $250. This category will screen funds that take the amount of money you wish to invest. Some funds have very high minimums and are for institutions. Put in the amount of money you want to invest internationally. I would recommend no more than 10% of your available investment money.
 
Front Load: “No Load.” Always choose “No Load” first. If you can’t find a fund with “No Load” (which means no up-front commission fees), then choose the one with the lowest fee. There is no long-term correlation between up-front fees and performance.
 
Total Expense: Less than 1.5%. In international funds, fees are higher because costs are more. Managers need to travel often and to go longer distances.
 
Holdings: Net Assets: Minimum of $250 million, maximum of $1 billion. Funds that have too much money sometimes chase after stocks that are marginal. If a fund has too little, it can’t create a good diversified portfolio.
 
Turnover: Minimum of 10%, maximum of 40%. You’re looking for investments, not trading vehicles. The Turnover tells you how much of the portfolio is bought and sold during one year.
 
Median Market Cap: $1 billion minimum, $10 billion maximum.
 
You don’t want to own very small companies internationally because
 
the odds of success are much lower. Median Market Cap refers to the capitalization of the stocks the fund buys. The capitalization is determined by multiplying the number of shares of stock times the price.
 
Results Display Setting: Display info for: All Available. You want to see all the funds that match your variables and then rank them.
 
In this screen that I just described, the following funds met the requirements: None. That means the criteria were too confining for the search and need to be adjusted. That’s the way screenings are. When you go for your ideal, you don’t always find it. Then you start to fine-tune it to reality. And unfortunately, the only way to do that is to change one or two parameters and see if those are the ones that will give you results.
 
In terms of which parameters to work on first, remember that we’re going for low-risk investing. So work with the Ratings parameters first, changing them by adding a little more risk. If there are still no funds that fit within your Comfort Zone parameters, then international investing doesn’t belong in your portfolio. Use the same screening program for finding Growth Funds, Value Funds, Income Funds, etc.
 
More Screening Programs
 
There’s an excellent one on MSN Money: http://moneycentral.msn.com/investor/research/fundwelcome.asp?Funds=1. It has four levels of screens: Top Performing Funds; Easy Screener; Deluxe Screener; Power Searches.
 
The first one, Top Performing Funds, is of mild interest. You can choose World Stock as your option and click on Go. It will return the best funds based on their performance over the last 3 months (no interest to us) and then show another list of funds based on their performance of the last 3 years, which also gives their performance over the last 5-years. This one is of more interest, especially when looking at the 5-year performance. But this is not a screen that lets you define the parameters.
 
The second option, Easy Screener, gives more information about the top 25 funds in the World Stock category, including: the name of the fund, its Front End Load (we want 0 here), the Expense Ratio (as close to 1 as you can find but tempered with the fund’s performance; you may pay a little more in expenses for better performance), the 1-year total return (of some interest, but not much) and the all important 5-year annualized return, the most important number, the one that tells us, on average, what the fund made every year in the last 5 years. Remember, it’s an average so the return for any one year may be way up or way down. The funds are ranked by their 1-year average return. What you’d like to find is a good return over the last year, and a great average annualized return for 5 years. When I did the screen research for this paragraph, the best fund was Oakmark Global, which had a 1-year return of 23.3% and a 5-year average return of 18.8%.
 
But don’t buy this fund based on the information above, even if it shows up as the best performer when you do your screen. Only buy a fund after you have investigated it fully. The point here is that you want to look at the 1-year performance and the 5-year performance and pick the fund that has high returns for both, not necessarily the highest return in the 1-year column.
 
The third option is the Deluxe Screener, which requires the user to download a program from Microsoft. While it is a good program, it is more for the advanced investor.
 
The fourth option, the Power Search, offers two searches: Basic and Deluxe. The Basic Search returns funds in several categories, including World Stock Fund. By clicking on that heading, a list of top funds is shown, ranked by their expense ratios. It also shows the 1-year and 5-year returns as well as the front load. Each listing has the fund’s name, its symbol, and a link to a description of the fund. When you click on the fund’s symbol you go to a Morningstar page that gives a synopsis of the fund. This page is not enough information to base an investment on, but it gives you the basic information you need to decide if you want to spend more time investigating the fund.
 
The Deluxe Power Search requires use of the downloaded software to fully utilize its power.
 
More mutual fund screening programs are on these Web sites:
 
Forbes.com http://www.forbes.com/finance/screener/Screener.html
 
Morningstar http://screen.morningstar.com/FundSelector.html
 
Your brokerage firm has good information as well. Not all funds will be represented by every brokerage firm, but some of the online brokers such as Schwab, Ameritrade, Scottrade, and others have research tools that show the best funds in several categories, including international funds.
 
The Infinite Variety of Funds
 
Here are a few examples of the funds you can buy:
 
•  Balanced funds, also known as hybrid funds, invest in stocks and bonds, with some cash holdings as well. Recommended for the Core Portfolio.
 
•  A blend fund (also known as a core fund) invests in all levels of companies—small, mid-size, and large—and, unless prohibited by their prospectus, in growth and value companies.
 
•  Bond funds buy debt instruments of companies and governments. They receive the income from the bonds as well as trade bonds for capital gains or losses. These tend to be less volatile than stock funds. Within the group there are Junk bond funds (also known as high-yield bond funds); treasury bond funds; treasury note funds; treasury bill funds; corporate bond funds; short-term bond funds; convertible bond funds, and many more.
 
•  Global and international funds invest in stocks and bonds outside the United States.
 
•  Index funds mimic a specific index such as the Nasdaq 100 or the S&P 500.
 
•  Large-cap funds specialize in companies over $10 billion in market cap. Good choice for the Core Portfolio.
 
•  Mid-cap funds focus on medium-size companies having a market cap between $5 billion and $10 billion.
 
•  Money market funds always have a value of $1 and invest in very short-term corporate and government debt. Rates are usually higher than other short-term investments. It is a good place for cash while waiting to invest longer term.
 
•  Sector funds invest in a specific industry such as health care, technology, energy, precious metals, etc. This is a great way to add a sector to the Core Portfolio.
 
•  Small-cap or aggressive growth funds specialize in smaller companies, usually with a market cap of $1 billion to $5 billion.
 
•  Value funds find stocks with low stock prices relative to their earnings or assets. These are also highly recommended for the Core Portfolio.
 
It’s worth repeating: mutual funds are a great way to start investing. Spend time on the various sites with mutual fund screeners. Get familiar with the data presented. And here’s one final tip: Vanguard Funds are known for their very low fees. Always check whatever fund you are considering against a similar fund offered by Vanguard. If the performances are similar, go with Vanguard. You’ll have more of your money working for you because you’ll pay lower or fewer fees.
 
 
Copyright © 2007 by Ted Allrich. All rights reserved.