Currently, 100 percent of my retirement funds are in a well-known hybrid fund with built-in diversity. But I think I should call the investment adviser and re-allocate my small pool of assets. So far I've been lucky: My fund of choice outperformed the Dow Jones Industrial Average in 2008. The fund was down about 31 percent, versus a decline of about 42 percent in the Blue Chip index.
But in addition to the hybrid fund, I think that I should also consider a fixed-income fund and a cash-equivalent account. Here are my questions:
- How much diversity is enough?
- Should all funds be housed with a single investment firm?
- If one investment firm offers funds from a broad mix of third-party mutual funds, is it best to select different providers for each asset class?
- What about global diversification?
Those are a few of the questions, I plan to ask market professionals over the next few weeks. I don't plan to retire for years. In fact, I'll be happier if I keep working, but it's good to keep planning.
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