Investment

Since it takes a lot of time to manage a portfolio of individual stocks, many people are better off putting their money in mutual funds.  So, we will tell you the same thing that we have told to our friends and family members who have asked for our investment advice.  Split your money between two no load broad based index funds: one equity fund, and one bond fund.  Depending on how much risk you are comfortable with, put 25% to 100% in the equity fund, and the balance in the bond fund.  See our current mutual fund portfolio.

Academic studies show that the average rate of return for no load mutual funds is about equal to that of loaded mutual funds before subtracting the sales load which can run 4% to 10%. Consequently, we never buy a fund with a sales load. We always buy no load mutual funds. We don't care how nice the salesman talks. He is not getting 4% of our money up front.

Right now, contrary to our general philosophy of not trying to time the market, our mutual fund portfolio is mostly in Intermediate Term Treasury Notes. We are scared of the current economy and policies which may prolong or deepen the recession. As of 05/15/2009, we are projecting a double dip recession, or a single dip (the current one) followed by a slow recovery. Consequently, we are either in a Bear market rally, or a Bull market which will stagnate and flatten out for an extended period. Or, we are wrong.

See our current mutual fund portfolio.