The pattern, if you can see it by the way Wall Street has fared in this recession, is that corporations that are more out there, living life on the verge, taking chances for a better return, are the ones that are the least affected. People with investments in the little companies, the ones they hoped would someway buck the trend, in fact did do just that, possibly because the little companies felt they had so little to lose, they could take chances. They took their risks, and they came out on top. Not that your stocks in these companies really made you a gain; they took such a pounding in the first half of the year, and they are just climbing back to where they left off. There are funds out there that only take on large and growing corporations; and these have performed very well. All the gossip in the newspapers now is roughly how you could consider it pretty good if you invest in a big and growing company and have it climb roughly 20%. There are some out there that in fact go twice as far. So apparently, the mantra for any stock market system in 2010 is, go for the large company. And if you invest in a fund that deals in these corporations, you’d have a good option, whether or not it is a good stockmarket this year.
But if you think about it, investment in American stocks was what got you into trouble resulting from regulation. Although these are still excellent targets for fundamentals of futures and options markets. But what if you looked east, at China or India? They welcome your investment dollars, and those businesses really seem a lot more robust than the american ones. If you want, you may check out something called the MCSI Emerging Markets Index to find out what places are doing best. Making your investments through growth funds is a good idea currently. It will make you less nervous. And if you want to invest in foreign markets, this would help you get the mix between local and foreign markets precisely right. The trick, though, is, not to put all your eggs in one growth fund, but to spread the risk.
I personally have my capital on a a small number of growth funds available. Masters’ Select International seems to be competently run. They divide their business among several managers, each offering their own sectors of expertise, and all of them are under the direct supervision of respected mutual fund analysts. You could plant a 3rd of your capital in here, and they would invest a 3rd of that in countries down in Latin America and over in Asia. T. Rowe Price has a great emerging markets product too; they did take a pounding earlier with the economic recession, but they more than made up for it with an 80% escalation. Or how about going with this growth fund for small business investments that grow aggressively? They’re pretty respectable, you understand.
For the american part of your stock investments mix, Primecap Odyssey Growth and Fairholme are a good choice. They’ve been in business for about 25 years now, and have a very good return rate that is beyond what the Standard&Poor would have you settle for. They take your capital to make stock investments in large corporations, and are pretty stable. corporations by the way, that are good to own and sell a covered call option on. Well, that’s the word on Wall Street at least, and we can go on that for now.