the asset—whether in mutual funds or otherwise—be no more than 5% of your total portfolio.
Real Estate: Still Worth a Look
There is a rock-solid, both-feet-on-the-ground appeal to real estate that few other assets can match. The downside: Real estate is expensive. So to gain the type of location, location, location that helps protect your investment over time, most individual investors turn to shares of REITs.
REITs combine the best attributes of stocks and bonds. They often climb in good stock markets, and their returns generally keep apace with the big stock indices. There’s an added boost that rivals the appeal of bonds. Tax laws require REITs to distribute 95% of their income, which is divvied up to holders in hefty dividend payments—currently an average 4.5 %.
For more on REITs, visit the Website of the National Association of Real Estate Investment Trusts, www.nareit.org and see Moneywise, “Real Opportunities,” (December 2007).
In the end, remember that any changes you make in your portfolio should be part of a larger plan and not made as a quick-fire reaction to any anxiety you may be feeling at the moment. Judith Jones says she’s quite happy she set out to put a diversification plan in her portfolio. “It helps me rest better at night, knowing my money is in a safe place and earning quite a high return,” she says. “I think my friends are starting to reap the benefits of my advice, too.”
|Intermediate-Term Bond||Ticker||3 Yrs||5 Yrs||10 Yrs||Expense Ratio||Minimum Initial Investment||Web Address|
|Intermediate Term Bonds|
|Metropolitan West Total Return Bond M||MWTRX||5.52%||7.55%||6.65%||0.65%||$5,000||www.mwamllc.com|
|Managers Fremont Bond||MBDFX||4.14||4.88||6.44||0.60||2,000||www.managersfunds.com|
|ING VP Intermediate Bd I||IPIIX||4.05||4.80||5.76||0.49||0||www.ingfunds.com|
|TCW Core Fixed-Income I||TGCFX||3.56||4.78||5.61||0.79||2,000||www.tcw.com|
|Dodge & Cox Income||DODIX||3.93||4.54||6.18||0.44||2,500||www.dodgeandcox.com|
|American Century Target Mat 2025 Inv||BTTRX||6.33%||6.22%||8.99%||0.57%||$2,500||www.americancentury.com|
|Wasatch-Hoisington U.S. Treasury||WHOSX||5.00||4.68||7.16||0.72||2,000||www.wasatchfunds.com|
|Dupree Intermediate Govt Bond||DPIGX||4.22||4.50||5.66||0.51||100||www.dupree-funds.com|
|Analytic Short-Term Govt Inc Instl||ANSTX||4.14||4.20||5.13||0.60||2,500||www.aninvestor.com|