Mutual funds: mixing it up.(hybrid mutual funds)

Publication: Consumer Reports

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COPYRIGHT 2002 Consumers Union of the United States, Inc.

BACK TO A BASIC

The mutual fund's allure, when it sprang to life in 1924, was one-stop shopping--a diversified portfolio of stocks and bonds that would cover an investor's every need.

In recent years, however, funds have multiplied faster than guppies into specialized categories: large cap, small cap, value, growth, biotech, natural resources, short-term bond, international bond--the list seems endless. No longer does a fund serve as a person's entire portfolio but instead plays a small role within it, almost like an individual security.

Fortunately for consumers who seek a basic starter investment or a solid, plain-vanilla holding, there still is such a thing as a good, old, all-purpose fund only now it's called a hybrid, or balanced fund.

"Balanced funds don't get much attention with all the sector and specialty funds going for big gains,"...

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