Quote:
Originally Posted by noppenbd
For your current 401k I would suggest
25% Polen Capital Large Cap Growth
25% NFJ Dividend Large Cap Value
15% Wells Capital Small/Mid Cap
15% Calamos Small/Mid Cap
20% Julius Baer International Growth
I might tweak this or eliminate some funds based on past performance and/or expenses. See if you can get this info for the funds.
EDIT: I also would definitely point out that 5 stocks in your 401k brokerage is in no way diversified. There is risk, and there is measured risk. Having your whole (or even half of) your 401k riding on 5 companies is a bad idea IMO. Think Enron, Bear Stearns, Worldcom, etc. Stick with index ETFs or mutual funds.
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Thanks for the post. I would argue that you *can* stay diversified with only 5 stocks and a 25% cash position. This means any one stock has <= 15% of your 401(k) capital at any given time.
I define diversification as spreading out your capital among solid investments across several *sectors*. For example, I would rather own 2 of the most quality stocks in the S&P 500 in 2 totally different sectors (tech/pharmaceutical), than an equal share of the entire S&P500 (index fund).
Your point is well taken though. With this style of investing, you would definitely want to choose investments very carefully, and do a good amount of research while you own them as well. I also believe I can afford greater risk due to my age.