Newspaper Page Text
■ Financial
■ Focus
Reported by Sonny Doehring
Choose Mutual Funds carefully
to help diversify portfolio
If you’re somewhat familiar with
investing, you probably have heard
that owning mutual funds is a good
way to help diversify your portfolio. Is
this true? And, if so, how should you
go about selecting the right mutual
funds?
To begin with, let’s quickly review
the importance of diversification. By
owning a variety of investments— such
as stocks, bonds and government secu
rities — you can help reduce the effects
of volatility on your portfolio. And
while diversification by itself cannot
guarantee profits nor protect against
a loss, a diversified portfolio can help
you reduce the impact of market down
turns that may hit one asset class par
ticularly hard.
Because an individual mutual fund
invests in many different securities, it
automatically brings a certain degree
of diversification to your portfolio. And
yet, you can’t just purchase any com
bination of mutual funds and expect
good results. Consider this: There are
more than 8,000 mutual funds in the
financial marketplace, according to the
Investment Company Institute, the
trade group for the mutual fund indus
try. About 60 percent of these funds
are stock funds, with the rest being
“hybrid” or “balanced” funds (which
invest in a mix of stocks and bonds),
taxable bond funds, municipal bond
funds, and money market funds. With
such a large number of funds available,
and with a finite amount of stocks,
bonds and other securities in which
these funds can invest, it’s easy to
see that there is going to be consider
able duplication among many of these
mutual funds — and duplication is the
opposite of diversification. Consequent
ly, when you invest in mutual funds,
you can’t just adopt a philosophy that
can be boiled down to “the more, the
merrier.”
Furthermore, it isn’t just a matter
of one “large-cap growth” fund looking
like another. You might find that the
large-cap fund (a fund that invests in
stocks of large companies) is also quite
similar to a “technology” fund.
So, what’s the solution to avoiding
“overlapping” funds? There’s no magic
formula — you have to do your home
work. Before purchasing a new fund,
look closely at its holdings, which will
be posted on the fund’s prospectus.
(Also, while you’re looking at the pro
spectus, make sure you understand
the fund’s investment objective, risk,
charges and expenses.) Then compare
these holdings to the ones listed on
your existing mutual funds — if you
see too many redundancies, you may
want to take a pass on this particular
fund.
Ultimately, your first step in diver
sifying a mutual fund portfolio is to
identify your individual risk tolerance
and investment objectives. Are you
a conservative, moderate or aggres
sive investor? Do you need growth,
income or a combination of both? Once
you’ve answered these questions, you
can then begin selecting the right mix
of mutual funds to help you achieve
your financial goals. Of course, with
all the variables involved, both in your
personal situation and in the funds
themselves, you may want to enlist the
help of a professional financial advisor
— someone with the experience to help
you choose those funds that are right
for you.
Many people have successfully incor
porated mutual funds into their invest
ment strategy — and with the proper
effort and assistance, you can too.
Mutual funds are offered and sold
by prospectus. You should consider
the investment objective, risks, and
Clean Your
Air Ducts Now:
Most A/C air ducts are smelly,
dirty & unhealthy. Clean them
with Roto Vac Airsweep Duct
Cleaning & Sanitizing.
• Clean - Sanitizes Air Duct
• Decreases Household Dust
• Improve Health & Breathing
• Kills germs, virus, bacteria, mold & mildew
• Increases A/C System life and efficiency
• Keeps your Home or Business Clean
Protect Your
Family and
Property!
1 Alert ll
1/ Alarm \1
I
D*E*L*I*G»H*T»F»U*L
Air Conditioning/Duct Cleaning
638-2222 265-2222
■265-1017
Trademark Frigidaire under license
Serving & Protecting the Islands with thousands of customers for 40 years
THE ISLANDER, JUNE 22, 2009, PAGE 3
Business Upda
State unemployment rate
rises to 9.7% in May
The Georgia Department of Labor
(GDOL) has reported that the state’s
seasonally adjusted unemployment
rate jumped to 9.7% in May, the high
est rate ever recorded in Georgia. The
jobless rate was up five-tenths of a
percentage point from a revised 9.2%
in April.
The increased number of unem
ployed workers in May included many
discouraged workers who reentered
the labor force. Last month, 463,883
unemployed Georgians were looking
for work, an increase of 62% from May
of 2008. Of that number, 157,544, or
34%, are receiving state unemploy
ment insurance benefits, while approx-
charges and expenses carefully before
investing. The prospectus contains this
and other information. Your Edward
Jones financial advisor can provide a
prospectus, which should be read care
fully before investing. □
imatefy another 90,000 are receiving
federal extended benefits.
The May jobless rate was up 3.8 per
centage points from 5.9% at this same
time last year. Georgia’s unemploy
ment rate remained above the national
rate of 9.4% for the 19th consecutive
month.
The number of payroll jobs in May
decreased 217,000, or 5.2%, from May
of 2008. The over-the-year losses came
in professional and business servic
es, including temporary employment
agencies, manufacturing, trade, trans
portation and warehousing, and in
the construction industry. Job gainers
totaling 16,200 were recorded in health
care and educational services.
Unemployed Georgians may be
eligible for up to 20 weeks of State
Extended Benefits (SEB), if regular
state unemployment insurance ben
efits (UI) and the first and second tiers
of federal Emergency Unemployment
Compensation (EUC) benefits have
been exhausted. SEB eligible individu
als must apply online or at a labor
department career center. □
SEVENTEEN LOCATIONS: Darien, Brunswick, Southport, Douglas, Eulonia, Folkston, Hazlehurst,
Hoboken, Kingsland, Nahunta, Nicholls, Richmond Hill, St. Marys,Woodbine, Callahan, Hilliard, and Yulee.
LDP-1 185-09
